Hell Freezing Over!!!

[Scab]

To match my eyes, of course. Why else did I buy the blue '05?

 

[PapaUtah]

A 1970 Road King.

Todays 2006 Road King and many other models still look like this.

I was born in 1969. I grew up wanting a Harley for numerous reasons but none educated, just movies, sounds, looks etc.

Today my friends and others still have kids that love Harleys at an Early age and sure many will grow up to love them by many of the same influences that affected me.

I look at this bike and all I can imagine is some really old guy with a really bad goatee and a maroon fez for a hat riding figure eights in a parade on the 4th of July circa 1959...

 

[MikeYork5]

I don't know much about business, but isn't it a bad thing when you are a MOTORCYCLE dealer and you are looking at clothing as a major source of income? I thought those types of things were supposed to be "extras" that helped the bottom line, but weren't THE bottom line.

That in a nutshell is why (as far as I am concerned) Harley is destined to fail as a motorcycle company. They sell image not content. Either the whole things gonna fold in on itself, or it will morph into a company that just sells Hardly-Abbelson "accesories" in which case it is no longer a "motorcycle" company.

Don't believe me. Look at their product line. They've been selling the same models warmed over with new paint and chrome (The HD equivilant of Bold New Graphics) for damn near fifty years. They do have the new VRod. But its been out for a couple years and all they've done to it is the BNG treatment.

....

You know, I just hamered out a great big long rant on how HD sucks on so many levels. then I deleted it. Its all been said before.

I figure just sit back and watch the company in its slow slide into irrelevance in the motorcycle world.....

- Colin

Gaafaw!!!!!!! I wouldn't hold me breath if I were you.

-Mike

 

[sparky3008]

I don't know much about business, but isn't it a bad thing when you are a MOTORCYCLE dealer and you are looking at clothing as a major source of income? I thought those types of things were supposed to be "extras" that helped the bottom line, but weren't THE bottom line.

That in a nutshell is why (as far as I am concerned) Harley is destined to fail as a motorcycle company. They sell image not content. Either the whole things gonna fold in on itself, or it will morph into a company that just sells Hardly-Abbelson "accesories" in which case it is no longer a "motorcycle" company.

Don't believe me. Look at their product line. They've been selling the same models warmed over with new paint and chrome (The HD equivilant of Bold New Graphics) for damn near fifty years. They do have the new VRod. But its been out for a couple years and all they've done to it is the BNG treatment.

....

You know, I just hamered out a great big long rant on how HD sucks on so many levels. then I deleted it. Its all been said before.

I figure just sit back and watch the company in its slow slide into irrelevance in the motorcycle world.....

- Colin

Gaafaw!!!!!!! I wouldn't hold me breath if I were you.

-Mike

His statement of not knowing much about business should have been a clue.

Look at car dealers and japanese bike dealers.

What do you think the profit maker is.

Parts and Service not Sales...

Now Harley has Parts/Service/ and a HUGE clothing market...

Probably part of Business 101

 

[PapaUtah]

Harley-Davidson™ has a current gross margin of around 40% on their new bikes. Bikes have been their main source of income in the recent past. Service will provide some level of income, but that is revenue to the dealers. Harley-Davidson™ gets revenue on the parts and accessories. (Currently about 20% of their bottom line IIRC)

Don't count Milwaukee out. There are plenty of baby-boomers still to retire and trying to re-purchase their youth. Just don't count on The Motor Company™ being a growth company as they were in the past. They have ramped production up to about the level of demand of said baby boomers retiring and trying to re-purchase their youth. H-D™ will be a wise choice in a portfolio of income generating securities as they have been a consistent dividend payer. You just won't see the stock price jumping 20% or more per year.

This is reinforced by the current promos by The Motor Company™. They have saturated the their target market, you know who you are. They are now actively courting *******, er, um excuse the Harley™ venacular, women riders, with "Garage Parties" similiar to Tupperware parties. Women are invited to the Harley-Davidson™ boutiques to try on all the wonderful clothes and while they are at it, how do they look on a new Sportster™. Harley-Davidson™ also has programs to attract hispanics and riders of African descent. And by highlighting Elton John at the 100th Anniversary Celebration it appears they are actively courting the same-sex "community" also.

The old dog may learn a new trick yet!

 

[Scab]

Actually Sparky, don't let my humility fool you. My knowledge of business is not a complete vacuum.

As for any motor vehicle dealer, the primary purpose of the business is the vehicle. Without that, the rest is gone. As for Automobile dealers, there are many ways in which they make profit including the financing the convince you to accept. However, rarely is the service department a consistent profit maker. Service is a neccessary evil to a new car dealer, something you have to provide when you sell cars. Believe me, there would not be a single investor in this ole world lining up to build a new Ford dealership if the only profit areas were service and parts.

And, as for my local Japanese motorcyle/atv dealer. If he were to survive only on parts and service, he would have already starved. This is one of the reasons I am not real fond of the dealership: A near total lack of accessories. They sell machines.

And what about the motorcycle 'clearing houses'? They sell no accessories, they finance nothing, they sell bikes-period.

Regardless of how you present the possibilities for the Harley dealers to profit and survive, how do any of these areas (that are not selling motorcycles) contribute to keeping the motorcycle manufacturing plant open and in business?

The financial shape of the dealers will be a direct reflection of the health of Harley-davidson. When the dealers no longer sell motorcycles but something else, Harley-Davidson will cease to be a motorcycle company.

The price of stock is not always to be counted upon either. Enron used to be up.

 

[sparky3008]

Actually Sparky, don't let my humility fool you. My knowledge of business is not a complete vacuum.As for any motor vehicle dealer, the primary purpose of the business is the vehicle. Without that, the rest is gone. As for Automobile dealers, there are many ways in which they make profit including the financing the convince you to accept. However, rarely is the service department a consistent profit maker. Service is a neccessary evil to a new car dealer, something you have to provide when you sell cars. Believe me, there would not be a single investor in this ole world lining up to build a new Ford dealership if the only profit areas were service and parts.

And, as for my local Japanese motorcyle/atv dealer. If he were to survive only on parts and service, he would have already starved. This is one of the reasons I am not real fond of the dealership: A near total lack of accessories. They sell machines.

And what about the motorcycle 'clearing houses'? They sell no accessories, they finance nothing, they sell bikes-period.

Regardless of how you present the possibilities for the Harley dealers to profit and survive, how do any of these areas (that are not selling motorcycles) contribute to keeping the motorcycle manufacturing plant open and in business?

The financial shape of the dealers will be a direct reflection of the health of Harley-davidson. When the dealers no longer sell motorcycles but something else, Harley-Davidson will cease to be a motorcycle company.

The price of stock is not always to be counted upon either. Enron used to be up.

Ever been out of the Country? Harley is all over the world and they are as big if not even bigger in the rest of the world. Heck on my honeymoon in Aruba, yep Harley...

I have too many friends in the automobile and bike sales business to not believe what I said. I know the part they make in commission on the cars/bikes and what the dealer had to pay to get the bike there. The amount the dealer then keeps after the rent/mortgage on that building and the amount they sell every month wouldn't keep them in business very long.

They have to supplement it with the rest.

True sells in needed and can't be overlooked but it is the sell that gets the customer back to service, and parts and with bikes gets them to buy helmets, clothing, boots etc. The profit margin here is much bigger...

The company I work for is a software development company specializing in the insurance, utilities and recently the healthcare industry. Our sell of software, while obviously the first part to get into a business, is not the money maker. We have ASP centers that many companies use to do the billing and send out the paper portions to customers. This is a huge constant resource of revenue.

We also have maintenance programs that are renewed each year and this is a constant source.

Every year we get financial reports from our CEO and I see which portions are the money makers and sells is not it. While he would always like sells to be up it is the portion that lags behind...

On the statement above let me differenciate between dealer and maufacturer and I speak of dealer...

 

[charismaticmegafauna]

sparky3008 Posted Today, 01:49 PM<snip>The company I work for is a software development company specializing in the insurance, utilities and recently the healthcare industry.

Sparky; being in the insurance and support of the healthcare industry, I'm not so sure you can identify with the *real world*?To (somewhat) reiterate Scab's excellent post:

In the real world of the motorcycle/atv dealership it's new unit sales and that's just about it. Most dealers (especially, the smaller ones) would gladly close their service departments -- they're losers, and if they break-even the dealer's satisfied. Parts & accessories hasn't been much for years -- 'net and other catalog sales have had a very detrimental effect for many dealers.

As far as m/c sales go in the U.S. -- if it weren't for ATVs, it'd be pretty bleak.... The fixed costs/overhead pressures for m/c dealers are becoming, more-and-more, prohibitive (again, especially for the smaller dealers). BMW dealers, for instance, may soon be found only in bigger cities -- and then tacked-on to a car dealership.

If I were a venture capitalist I'd forgo the (struggling) m/c industry and look, instead, at the raging healthcare industry.... :blink:

 

[sparky3008]

sparky3008 Posted Today, 01:49 PM<snip>The company I work for is a software development company specializing in the insurance, utilities and recently the healthcare industry.

Sparky; being in the insurance and support of the healthcare industry, I'm not so sure you can identify with the *real world*?To (somewhat) reiterate Scab's excellent post:

In the real world of the motorcycle/atv dealership it's new unit sales and that's just about it. Most dealers (especially, the smaller ones) would gladly close their service departments -- they're losers, and if they break-even the dealer's satisfied. Parts & accessories hasn't been much for years -- 'net and other catalog sales have had a very detrimental effect for many dealers.

As far as m/c sales go in the U.S. -- if it weren't for ATVs, it'd be pretty bleak.... The fixed costs/overhead pressures for m/c dealers are becoming, more-and-more, prohibitive (again, especially for the smaller dealers). BMW dealers, for instance, may soon be found only in bigger cities -- and then tacked-on to a car dealership.

If I were a venture capitalist I'd forgo the (struggling) m/c industry and look, instead, at the raging healthcare industry.... :blink:

[/quote

Cool, I really don't care. I don't think they are going anywhere, Harley, BMW, big 4 none of them.

Now ATV's or Off Road vehicles all together might have a short life if the tree huggers keep taking all the land away but that's not because of sales...

Being on the West Coast and my being on the East Coast maybe I see things differently I don't know.

I have a few friends who are actually mechanics. One is certified Harley, Yamaha and BMW.

He has left a few times and each time they beg him back for more money.

He is always busy. Others on this board are a testiment to the high prices you pay for simple procedures that only take 30minutes and they charge 3 hours at $80 an hour. I get 10% off all parts and some of my friends get %15 off. When I did electrical estimating our increase in parts was in the hundreds of percent increase. We made huge money on parts even more than labor hours.

I would venture that if you go into any dealer and deal with them long enough and find out what their actual price on a bike is they will eventually tell you. I have gotten bikes for almost exactly what the dealer paid to get them in his shop. Now go find out what the mark up is on the oil or oil filter, tires, and for many other bikes, seats, mirrors, helmets, clothes. I have had them screw up enough to finally give it to me at their cost and the price difference many times is %50 or more.

Talk Talk Talk but my experience doesn't show me what you are saying???

 

[MikeYork5]

Actually Sparky, don't let my humility fool you. My knowledge of business is not a complete vacuum.As for any motor vehicle dealer, the primary purpose of the business is the vehicle. Without that, the rest is gone. As for Automobile dealers, there are many ways in which they make profit including the financing the convince you to accept. However, rarely is the service department a consistent profit maker. Service is a neccessary evil to a new car dealer, something you have to provide when you sell cars. Believe me, there would not be a single investor in this ole world lining up to build a new Ford dealership if the only profit areas were service and parts.

And, as for my local Japanese motorcyle/atv dealer. If he were to survive only on parts and service, he would have already starved. This is one of the reasons I am not real fond of the dealership: A near total lack of accessories. They sell machines.

And what about the motorcycle 'clearing houses'? They sell no accessories, they finance nothing, they sell bikes-period.

Regardless of how you present the possibilities for the Harley dealers to profit and survive, how do any of these areas (that are not selling motorcycles) contribute to keeping the motorcycle manufacturing plant open and in business?

The financial shape of the dealers will be a direct reflection of the health of Harley-davidson. When the dealers no longer sell motorcycles but something else, Harley-Davidson will cease to be a motorcycle company.

The price of stock is not always to be counted upon either. Enron used to be up.

Interesting slant on the business, both cars and bikes, misguided but interesting. I've been tin the car business for many (35) years (car business as in New Car Dealer -we own 12 across the country) - and your discription of your knowledge of it as a complete vacuum is close. As mentioned above, a car dealerships has primary depts. which can and do prduce profit, new car sales, used car sales, F & I dept, service, parts, and a few others depending on the store. Your statement 'rarely is the service department a consistent money maker' couldn't be farther from the truth. Service departments often times out gross the sales departments. In fact , one of the new car dealers primary objectives is 100% Service Absorbtion, that is for the service operation to cover or pay for the entire overhead of the dealership. Our guys average about 88% overall. Generally (and I say generally) the service and parts departments combined are the most profitable departments in a dealership. We have several Ford dealerships (two of the largest in the country) also one of largest Toyota stores in the country, and when we buy a new store we look very closely at the service and parts departments or the 'fixed operation'. Nobody would build a 'new dealership' (at a cost of 5-10 million) without the intent of ALL departments contributing, so I dont unerstand you statement ' nobody would build a store with the intent of only service and and parts as profit areas'. But thats a 'new car' dealership, however how many repair facilities (independents, chains, etc.) are out there doing just that?

As for the health of Harley-Davidson being a direct reflection of what the dealers do ---DUH! Don't hold your breath waiting for Harley to take a dump, they have been around for 100 years and last I heard they were doing quite well. Maybe you don't have to wait 6 months to a year for a bike like you did a couple of years ago, but I still think they will be around for a while.

 

[sparky3008]

Actually Sparky, don't let my humility fool you. My knowledge of business is not a complete vacuum.

As for any motor vehicle dealer, the primary purpose of the business is the vehicle. Without that, the rest is gone. As for Automobile dealers, there are many ways in which they make profit including the financing the convince you to accept. However, rarely is the service department a consistent profit maker. Service is a neccessary evil to a new car dealer, something you have to provide when you sell cars. Believe me, there would not be a single investor in this ole world lining up to build a new Ford dealership if the only profit areas were service and parts.

And, as for my local Japanese motorcyle/atv dealer. If he were to survive only on parts and service, he would have already starved. This is one of the reasons I am not real fond of the dealership: A near total lack of accessories. They sell machines.

And what about the motorcycle 'clearing houses'? They sell no accessories, they finance nothing, they sell bikes-period.

Regardless of how you present the possibilities for the Harley dealers to profit and survive, how do any of these areas (that are not selling motorcycles) contribute to keeping the motorcycle manufacturing plant open and in business?

The financial shape of the dealers will be a direct reflection of the health of Harley-davidson. When the dealers no longer sell motorcycles but something else, Harley-Davidson will cease to be a motorcycle company.

The price of stock is not always to be counted upon either. Enron used to be up.

Interesting slant on the business, both cars and bikes, misguided but interesting. I've been tin the car business for many (35) years (car business as in New Car Dealer -we own 12 across the country) - and your discription of your knowledge of it as a complete vacuum is close. As mentioned above, a car dealerships has primary depts. which can and do prduce profit, new car sales, used car sales, F & I dept, service, parts, and a few others depending on the store. Your statement 'rarely is the service department a consistent money maker' couldn't be farther from the truth. Service departments often times out gross the sales departments. In fact , one of the new car dealers primary objectives is 100% Service Absorbtion, that is for the service operation to cover or pay for the entire overhead of the dealership. Our guys average about 88% overall. Generally (and I say generally) the service and parts departments combined are the most profitable departments in a dealership. We we have several Ford dealerships (two of the largest in the country) also one of largest Toyota stores in the country, and when we buy a new store we look very closely at the service and parts departments or the 'fixed operation'. Nobody would build a 'new dealership' (at a cost of 5-10 million without the intent of ALL departments contributing, so I dont unerstand you statement ' nobody would build a store with the intent of only service and and parts as profit areas'. But thats a 'new car' dealership, however how many repair facilities (independents, chains, etc.) are out there doing just that?

As for the health of Harley-Davidson being a direct reflection of what the dealers do ---DUH! Don't hold your breath waiting for Harley to take a dump, they have been around for 100 years and last I heard they were doing quite well. Maybe you don't have to wait 6 months to a year for a bike like you did a couple of years ago, but I still think they will be around for a while.

You might want to duck if you start agreeing with me. I am known to be a lone wolf

I worked for years as a teenager in dealerships, cleaning new cars, undercoating, detailing etc.

It was ridiculous what dealers would charge for some of these items.

As a undercoater I got $15 a car, my company got a little more say $45 I don't remember but I do remember that the dealer would charge almost $1000 for something that cost them under $100.

WOW talk about scam and increase....

I towed cars for years too and my dealings with dealerships and their workers was constant.

I heard most of this stuff first hand. It isn't made up...

 

[MikeYork5]

Yeah - what the hell am I doing agreeing with you? Am I? Don't know who I'm agreeing with, rather just stating my opinion based on my car business knowledge and experience (or lack there of). Plus, when did hell freeze over?

 

[sparky3008]

Yeah - what the hell am I doing agreeing with you? Am I? Don't know who I'm agreeing with, rather just stating my opinion based on my car business knowledge and experience (or lack there of).

I know I am just having a bit of fun!!

 

[MikeYork5]

Also, concerning the cost of the vehicle, accesssories, anything for that matter. GENERALLY, there is a margin on a new car of 7-13%. That is if you pay MSRP, the dealer would make 7-13% based on the manufacturer, level of options, price of vehicle, etc. Once in a while, a dealer hits a 'home run' on some doofus but rarely on anything other than a vehicle that is the latest and greatest or a 'gotta have - the first one on the block' new model (it's all supply and demand folks - like $3.25 a gal gas). How many of you pay MSRP for a car, not many? Thats why a dealership (good thing) has several opportunities to make a profit in those other departments, if not, he wouldn't be around for long. He could not, and would not survive on a 7 -13% profit margin (used cars is a different story). As for those 'extras' like undercoating (but as you probably know thats a thing of the past), they are all part of the other areas a dealer can make additional profit. As far as the price for those accessories or add ons, its negotiable for those who choose to negotiate. Everybody ******* about the profit a new car dealer makes on (just) the sale of the car, it ain't so (see above). Now lets look at another unrelated industry, and a example I like to use: Let's say you want to buy a new couch - Go to Macy's, Nordstroms, etc., the couch is $3,000 and there is NO NEGOTIATING, it's 3 large. Whats the margin on it? Roughly 100%, it cost them $1,500 and they sell it for $3,000 (that would translate into your $15,000 Corolla costing 30K), with a few exceptions of course. But NOBODY things nothing of it -- it is indeed a strange world in which we live!

 

[sparky3008]

Also, concerning the cost of the vehicle, accesssories, anything for that matter. GENERALLY, there is a margin on a new car of 7-13%. That is if you pay MSRP, the dealer would make 7-13% based on the manufacturer, level of options, price of vehicle, etc. Once in a while, a dealer hits a 'home run' on some doofus but rarely on anything other than a vehicle that is the latest and greatest or a 'gotta have - the first one on the block' new model. How many of you pay MSRP for a car, not many? Thats why a dealership (good thing) has several opportunities to make a profit in those other departments, if not, he wouldn't be around for long. He could not, and would not survive on a 7 -13% profit margin (used cars is a different story). As for those 'extras' like undercoating (but as you probably know thats a thing of the past), they are all part of the other areas a dealer can make additional profit. As far as the price for those accessories or add ons, its negotiable for those who choose to negotiate. Everybody ******* about the profit a new car dealer makes on (just) the sale of the car, it ain't so (see above). Now lets look at another unrelated industry, and a example I like to use: Let's say you want to buy a new couch - Go to Macy's, Nordstroms, etc., the couch is $3,000 and there is NO NEGOTIATING, it's 3 large. Whats the margin on it? Roughly 100%, it cost them $1,500 and they sell it for $3,000 (that would translate into your 15,000 Corolla costing 30K), with a few exceptions of course. But NOBODY things nothing of it -- it is indeed a strange world in which we live!

Yep, what he said...

Now go support your local harley dealer and buy something chromed. Ouch ever see the price of that stuff :haha:

 

[charismaticmegafauna]

Boy O Boy, what differing perspectives. You guys seem to know what you're talking about; but, it just doesn't jive with what I've observed. Concerning car dealerships: the ones I've been to (admittedly, rarely) have sales depts. that look as "temporary" as possible (complete with what looks like rented furniture); the service dept. is busy doing warranty work (not traditionally a big money maker); and not much else (apparently) going on other than a large storage lot for "product". Your claim that service is "big" is hard to understand given the Amercan car buyer's insistance that new cars need NO service for something like 100K miles. For instance, they've forced the manufacturers to retrograde from functionally efficient rubber-belt cam drives to more old-fashioned (and, ultimately, more costly) chain-drives because the toothed rubber belts need periodic replacement and they refuse to do that and to buy cars that require same.

I'm not saying there isn't money to be made in the car biz -- apparently there always will be -- they're an American necessity (now). But, the profits are, maybe?, generated more from MBA's involvement and recorded on the books of big multi-line, multi-location stores. A far cry, imo, from what motorcyclists are typically involved with -- at least those of us in the "boonies". I guess when my local m/c dealer has a "Slasher" on site -- I'll know our industry has finally arrived....

 

[MikeYork5]

Geez, I gotta shut up. Speaking of that - as you see I got a Harley. A Softail Deuce which is pretty chromed up to begin with. Paid basically MSRP, I figure the dealer made about $1,200 - $1,500 on the bike. then I had to add pipes, and a **** load of chrome I got about 5K of extras on it, like I say 'polish that chrome'. And I have bought most of the accessories at Chicago Harley (at the 'great' deal of 20% off). So I figure at retail they (harley dealers or Yamaha for that matter) are making somewhere around 40+% (so Chicago Harley on their internet sales department is ONLY making about 20-25% gross profit) on parts and accessories (like car dealers). Early on I talked to the Parts Mgr. at my local Harley dealership (where I bought the bike) and said match their price and I'll buy from you, he wasn't interested. Real funny attidtude, the bike business generally lags the car business by a decade or two in attitude and business finess. My philosophy as whould be his (in my opinion) is; 'some gross (profit) is better than no gross profit'. So he lost about $800-$1,000 gross profit on me alone! It's a strange world in which we live (where have I heard that before).

 

[MikeYork5]

Boy O Boy, what differing perspectives. You guys seem to know what you're talking about; but, it just doesn't jive with what I've observed. Concerning car dealerships: the ones I've been to (admittedly, rarely) have sales depts. that look as "temporary" as possible (complete with what looks like rented furniture); the service dept. is busy doing warranty work (not traditionally a big money maker); and not much else (apparently) going on other than a large storage lot for "product". Your claim that service is "big" is hard to understand given the Amercan car buyer's insistance that new cars need NO service for something like 100K miles. For instance, they've forced the manufacturers to retrograde from functionally efficient rubber-belt cam drives to more old-fashioned (and, ultimately, more costly) chain-drives because the toothed rubber belts need periodic replacement and they refuse to do that and to buy cars that require same.I'm not saying there isn't money to be made in the car biz -- apparently there always will be -- they're an American necessity (now). But, the profits are, maybe?, generated more from MBA's involvement and recorded on the books of big multi-line, multi-location stores. A far cry, imo, from what motorcyclists are typically involved with -- at least those of us in the "boonies". I guess when my local m/c dealer has a "Slasher" on site -- I'll know our industry has finally arrived....

Ok this is my last post here promise(?). Todays Service departments better be doing a ton more of Customer Pay work vs. Warranty. For instance our Honda store (imports are traditional higher in maintenance vs. repair work - all customer pay by the way) does a mix of 35% warranty vs. 65% customer. Even our Ford stores do close to those same numbers. Remember, customer pay work also includes repair work as well as maintenance. You guys are maintaining your vehciles right (I know you do your FJR)? Like I say the 'average' motorcycle dealer trails the business approach/philosophy of the 'average' car dealership by several decades. But the guys that are smart, in a good market with sufficient operating capital are making some serious bucks as well.

 

[Scab]

Guys, the real markup in an automobile would probably scare you. Of course no one wants to really look at it because you then have to admit you paid too much. Check with Consumer Reports. If you're interested in purchasing something, they will tell you exactly (or close) what the dealer's cost is. (They charge for this service though) Generally, it's going to be around 80-83% of MSRP, not counting secret dealer incentatives. That means, on a $30,000 auto, the profit is a tiny $6,000 - $5,100. Yes, it's hard to see how they make a living moving a paltry couple hundred units per month.

In addition, extended warranties extend mostly their profit. The rate of financing you are convinced to accept is partly THEIRS. Yes, they get paid to sell you financing. Doc fees? Pure profit. Paint Sealant and fabric protector? Pure profit. Stripe package? Yeah, that was $12.00 worth of plastic.

And don't even bring up the dealers that will show you the invoice. That is a paperwork wash worthy of Houdini himself. Yes, that is what the dealer paid, but what they don't tell you about is the "Holdback". This is the amount of $$$$ that is paid to the dealer from the manufacturer once the vehicle has been sold.

But what about what my friend the sales guy said? Truthfully, he doesn't know either. Most dealers change sales staff more often than I change my underoos. Until you make it into management (such as the finance manager), you are not privy to all these secrets of the auto industry.

The money is there. Don't let 'em fool you. Even at my little local yammi shop. When I was there waiting for them to open, the owner pulls up in a Brand-New BMW. Yeah, he is just scrapin' by.

 

[sparky3008]

Guys, the real markup in an automobile would probably scare you. Of course no one wants to really look at it because you then have to admit you paid too much. Check with Consumer Reports. If you're interested in purchasing something, they will tell you exactly (or close) what the dealer's cost is. (They charge for this service though) Generally, it's going to be around 80-83% of MSRP, not counting secret dealer incentatives. That means, on a $30,000 auto, the profit is a tiny $6,000 - $5,100. Yes, it's hard to see how they make a living moving a paltry couple hundred units per month.In addition, extended warranties extend mostly their profit. The rate of financing you are convinced to accept is partly THEIRS. Yes, they get paid to sell you financing. Doc fees? Pure profit. Paint Sealant and fabric protector? Pure profit. Stripe package? Yeah, that was $12.00 worth of plastic.

And don't even bring up the dealers that will show you the invoice. That is a paperwork wash worthy of Houdini himself. Yes, that is what the dealer paid, but what they don't tell you about is the "Holdback". This is the amount of $$$$ that is paid to the dealer from the manufacturer once the vehicle has been sold.

But what about what my friend the sales guy said? Truthfully, he doesn't know either. Most dealers change sales staff more often than I change my underoos. Until you make it into management (such as the finance manager), you are not privy to all these secrets of the auto industry.

The money is there. Don't let 'em fool you. Even at my little local yammi shop. When I was there waiting for them to open, the owner pulls up in a Brand-New BMW. Yeah, he is just scrapin' by.

Interesting slant on the business, both cars and bikes, misguided but interesting. I've been tin the car business for many (35) years (car business as in New Car Dealer -we own 12 across the country)

This quote from MikeYork5 so I his statement of we own must mean that he doesn't know what he is talking about. :dribble: His experience must be completely wrong :dribble: Good job keeping this pointless argument going as you have only restated words with no proof.

Here's one, I say the world is coming to an end and since I said it in type and it can now be found on the internet it must be true...

Manufacturer mark up and Dealer Markup, this does need to remain separate and I do believe you have them crossed...

Guys, the real markup in an automobile would probably scare you. Of course no one wants to really look at it because you then have to admit you paid too much. Check with Consumer Reports. If you're interested in purchasing something, they will tell you exactly (or close) what the dealer's cost is. (They charge for this service though) Generally, it's going to be around 80-83% of MSRP, not counting secret dealer incentatives. That means, on a $30,000 auto, the profit is a tiny $6,000 - $5,100. Yes, it's hard to see how they make a living moving a paltry couple hundred units per month.

In addition, extended warranties extend mostly their profit. The rate of financing you are convinced to accept is partly THEIRS. Yes, they get paid to sell you financing. Doc fees? Pure profit. Paint Sealant and fabric protector? Pure profit. Stripe package? Yeah, that was $12.00 worth of plastic.

And don't even bring up the dealers that will show you the invoice. That is a paperwork wash worthy of Houdini himself. Yes, that is what the dealer paid, but what they don't tell you about is the "Holdback". This is the amount of $$$$ that is paid to the dealer from the manufacturer once the vehicle has been sold.

But what about what my friend the sales guy said? Truthfully, he doesn't know either. Most dealers change sales staff more often than I change my underoos. Until you make it into management (such as the finance manager), you are not privy to all these secrets of the auto industry.

The money is there. Don't let 'em fool you. Even at my little local yammi shop. When I was there waiting for them to open, the owner pulls up in a Brand-New BMW. Yeah, he is just scrapin' by.

Interesting slant on the business, both cars and bikes, misguided but interesting. I've been tin the car business for many (35) years (car business as in New Car Dealer -we own 12 across the country)

This quote from MikeYork5 so I his statement of we own must mean that he doesn't know what he is talking about. :dribble: His experience must be completely wrong :dribble: Good job keeping this pointless argument going as you have only restated words with no proof.

Here's one, I say the world is coming to an end and since I said it in type and it can now be found on the internet it must be true...

Manufacturer mark up and Dealer Markup, this does need to remain separate and I do believe you have them crossed...

A little bit of my point here.

My $40,000 Dodge Ram I got for $32,000 after rebates from the Manu not the Dealer. This did not bite into his profit at all. Yes, without the rebate and 6 months earlier many paid $8000 more than I did... and then a few months later Dodge offered employee savings to everyone and people got them even cheaper, still not biting into dealer profits...