[Striker01]

Originally Posted by Phillies8008

Why would you assume there'd be no discounts or deals? Do manufacturers never run specials? Do they never discount items that have too much inventory, or as a mechanism to goose sales? Why would cars not behave like every other good or service? Are people really under the impression that the only reason a car is ever discounted is because of dealerships?

Obviously manufacturers are going to have to address maintenance, whether that's them running regional service centers or current dealerships morphing into only service centers. I don't think anyone's saying that you'll just be on your own.

But again, this is all just fantasy, because it ain't happening in the US in our lifetimes. Lawmakers are going to remain bought by NADA.

Well I hope you’re right. Because I work at a dealership haha

[JTK44]

Originally Posted by Striker01

If you cut out the dealer there will be a complete absence of any discount or deals.

I also don’t know how you will go about if you have an issue with your car.

You might have to play the role of that middle man that the dealer once acted as.

The same way Ford does with the Mustang MachE: In order to have the MachE for sale, the dealer must agree to service the MachE, provided on the premise charging, on the premise parts. Servicing will be done by the service department, under warranty or out of warranty, like any other car. For selling the MachE, the dealer gets a fixed fee and makes money on the service. Tesla sells the same way. Salesmen are on salary, not commission and the cars are sold at a fixed price.

This is not rocket science.

As to discounts: When Ford mispriced the MachE, relative to the Tesla Model X and cars from both Hyundai and Kia, Ford had to reduce the price. This is what competition does. The difference with the Direct approach rather than the dealer approach, is that everyone will get the same price. There will be no incentives to lower price at the end of the month and/or year. Nor will your mother be taken to the cleaners.

Think of it: how many stores do you go into and then negotiate the price? Not in a super market, not in a department store, not in Costco, not in Walmart. People with time shop around to get the best price. People without time go to their local store and pay the price of convenience.

With direct sales, everyone pays the same price.

I think that is good thing!

[pz619]

Originally Posted by Striker01

If you cut out the dealer there will be a complete absence of any discount or deals.

I also don’t know how you will go about if you have an issue with your car.

You might have to play the role of that middle man that the dealer once acted as.

Umm Tesla, Rivian, Lucid all have various deals or add ons to spur additional sales. Plus everyone pays the same price, so you don't have to play stupid games to feel like you aren't getting fucked over. If people don't like the price, they'll buy something else. Also, OEMs can easily open service centers. Again, like the previously mentioned companies. Is it perfect? God no, there is a room for improvement. But it's on the right track. My opinion anyways.

[afadeev]

Originally Posted by Phillies8008

Just because Tesla is terrible doesn't mean that everyone is terrible. There's no reason that dealerships can't continue to exist as repair shops.

It doesn't work like that.
Most dealers make little to no money on new car sales, and just use new vehicle sales as a hook to bring the customers in for service (in and out of warranty) and used sales. If you take away new car sales, the dealer model falls apart. Some will applaud that outcome, but it under-appreciates the problem of allowing OEM to own service and warranty approval.

In direct sales (DS) model, dealerships are owned by the OEM, and so is the service, and so is warranty approval.

These services are inseparable.
You can't "break" one without "breaking" the rest.

Originally Posted by Phillies8008

There's not reason manufacturers can't setup regional repair centers, etc.

And they could, and the service will be subject to the same incentives that have resulted in the present state of Tesla service.
BTW, Tesla service used to be fantastic, until their sales overwhelmed the service capacity that OEM has no pressing incentive to expand.

Originally Posted by JTK44

Using Tesla as an example is just plain silly!
A better example would be the Ford MachE Mustang: those cars are sold at MSRP, no dickering.

You are describing a dealership model: Ford MachE MSRP pricing has nothing to do with direct-to-consumer OEM model.

Originally Posted by Phillies8008

Tesla is pretty terrible all the way around. I'm certainly not using them for any kind of benchmark.

Tesla is the de-facto benchmark of direct-sale model, whether you like that brand or not. And as Tesla is demonstrating, DS model is not all rainbows and butterflies!
Neither are the dealers. There are a lot of questionable and parasitic practices at the dealerships, and them buying politicians to protect their turf (who isn't!?) is not great.
You can take the pain of dealing with dealer's sales personnel once, or you can take the pain of dealing with OEM-owned dis-service personnel for the duration of your vehicle ownership. Pick you poison!

Tesla is the largest and most successful DS brand in the US and the world, as of now. Ignore Tesla lessons at your own peril.

a

[85Shark]

Originally Posted by Alpine300zhp

I suggest broadening your reach and find an excellent client advisor outside of your area that you can buy from with ease and ship car to your house or make it a mini-vacation by buying at the store and drive it home. Jon Shafer in California would be an excellent place to start.

Very good advice Alpine. We've acquired 4 bimmers from Jon and the whole process including great pricing is a breeze. Well worth the road trip.

[F32Fleet]

Originally Posted by Phillies8008

It's funny how I don't need dealerships for virtually anything else I buy in order to be "protected". The idea that dealerships protect the consumer from absolutely anything is, at best, laughable. They're predatory middlemen that add nothing but cost.

While you could argue that all retail stores are middlemen – and technically I suppose they are – there's a much stronger argument that they're bringing actual value to consumers. They aggregate products in one place so that I don't have to go to a thousand stores to get stuff, they handle warehousing and stocking, and they handle items that realistically can't be bought direct from the manufacturer – are you really doing to order straight from General Mills when you want a box of cereal? From whomever is the produce supplier in your area when you want apples?

Cars, however, are a different beast. They're already segregated by brand, so it's not like they're providing me with the convenience of one-stop shopping or anything like that. As other brands have shown, ordering directly from the manufacturer is possible and better.

If dealerships were smart, and weren't able to be lazy by buying politicians, buying a car would be as easy as it is with Carvana. Do everything online, don't play games, don't deal with some asshole F&I guy who's entire living is made by ripping you off, and have the car show up at your driveway. Seriously, buying from them was the absolute easiest and best car purchase experience I've ever had. Every dealership could do this, but won't because it denies them their chance to screw their customers.

A lot of what dealerships do is required by the automaker. They're forced to spend a tonne of $$ on facilities and provide a particular sales/service experience. The real issue is the the compensation structure is commission based which by itself encourages people to be assholes.

[JTK44]

BTW, Tesla service used to be fantastic, until their sales overwhelmed the service capacity that OEM has no pressing incentive to expand

Tesla service was never "fantastic". Basically at the beginning it was non existent: Perhaps you have forgotten that in an accident, getting parts often took 3 to 6 months. If you needed a normal repair, parts could take up to 3 months to get. Tesla had no inventory of parts. Tesla used all the parts to build new cars, leaving nothing in reserve for repairs.




You are describing a dealership model: Ford MachE MSRP pricing has nothing to do with direct-to-consumer OEM model.

Actually no: With the MachE, Ford not the dealer sets the price. You can order online or at the dealer - the price is the same. This is exactly how the direct sales model works - and how Tesla works. All the dealer does for a fee is prep the car and service it.

[Sand]

my in-laws ordered their Tesla online. They never even had to leave their house. The car was delivered by a flatbed tow truck about a month later. I thought that was pretty cool.

I sure wish that I can order my next BMW without having to get dressed and go to the BMW dealer.

[BklynNYBMW]

Originally Posted by F32Fleet

Interesting but these are small markets. US would be really interesting because they couldn't pull tricks with dealer "sales" or order to hit their numbers


Edit: Anyone know of BMW re-opened their corporate dealership in Manhattan NYC?

Iirc some 25 yrs ago it was the only corporate dealership in the US.

Yes, BMW of Manhattan is still around at West 57th Street and 11th Avenue. They have been around for years. As a matter of fact they just did a remodel of their showroom about a year and half ago. I purchased my 2018 340i xdrive and my 2021 M340ix drive from them. I found them very easy to work with and were very accommodating. My M340i xdrive came in 2 months early. They kept it for 2 and half months until the lease was up on the 2018 340i xdrive. I was also able to order the M340i in Tanzanite when it was taken off the color palette on the website. No other dealer was able to get me that color and the combination. But they got it for me. I guess the advantage of being a corporate store.
__________________________________________________ _______________________
2024 X6 M60i. Tanzanite Blue with Black extended Leather with Red Calipers. Every option box checked. AKA Blue Knight
2021 M340i xdrive. Tanzanite Blue with W/Oyster with Red Calipers. All options except Adaptive M suspension, Driver Assistance Professional Package, Cooling and High Performance Tire package. AKA Blue Angel
*Retired 04/30/21: 2018 340i MSport Xdrive sedan. Glacier Silver w/Oyster. All options except active cruise control and window shades. AKA Airstream *Retired 12/16/23: 2017 X6 5.0 MSport, Carbon Black Metallic w/ black leather. All options except vented seats and B/O sound system. AKA the Tumbler

[Higgs Boson]

Originally Posted by Sand

my in-laws ordered their Tesla online. They never even had to leave their house. The car was delivered by a flatbed tow truck about a month later. I thought that was pretty cool.

I sure wish that I can order my next BMW without having to get dressed and go to the BMW dealer.

you can already do that.

[Altamate]

Originally Posted by JTK44

Costco sells at 10% above cost. They make money on membership.

Home Depot buys in bulk and then sells.

Both of those and Amazon, Wayfair and any others like them are not manufacturing anything and buying from them does not seem to be the same as buying a car directly from a car company?

In fact on some items like appliances, lighting, spools of electrical wire, batteries etc they( Costco and Home Depot) are competing against each other selling the exact same product possibly or likely at different prices?

What am I missing?

[Sand]

Originally Posted by Higgs Boson

you can already do that.

directly from BMW? without having to go through a BMW dealer?

[Higgs Boson]

Originally Posted by Sand

directly from BMW? without having to go through a BMW dealer?

"I sure wish that I can order my next BMW without having to get dressed and go to the BMW dealer."

That is what I was replying to. You didn't say you wanted to order it from BMW Corporate, just that you didn't want to get dressed.

Call a dealer, offer them MSRP for the car you like, ask them to deliver it to your house. It can easily be done. I have bought 6 BMWs that way and about 60 other cars in the last 5 years exactly that way (some more than MSRP and some less).

[ash_schwin]

I hate and despise car sales through dealerships so this will be very welcome news on my part.

[F32Fleet]

Originally Posted by afadeev

Tesla is the de-facto benchmark of direct-sale model, whether you like that brand or not. And as Tesla is demonstrating, DS model is not all rainbows and butterflies!
Neither are the dealers. There are a lot of questionable and parasitic practices at the dealerships, and them buying politicians to protect their turf (who isn't!?) is not great.
You can take the pain of dealing with dealer's sales personnel once, or you can take the pain of dealing with OEM-owned dis-service personnel for the duration of your vehicle ownership. Pick you poison!

Tesla is the largest and most successful DS brand in the US and the world, as of now. Ignore Tesla lessons at your own peril.

a

Warranty approval is ultimately approved by the manufacturer or the dealership eats it.

[Windshieldfarmer]

Originally Posted by pz619

I'm so done with dealerships and their stupid games. Full disclosure, I sold cars through college. I fucking hated everything about it, except that it paid pretty well compared to what my peers were making while putting themselves through school.

Few years back I was trying to buy a Chevy Bolt as a cheap commuter car. The experience with virtually every dealership regionally was only slightly less painful than going down a slide made out of cheese grater. Even this week, a coworker is trying to buy a Chevy Sierra and they won't even give you a price over email unless you show up. When you do show up you learn the internet price didn't include "trucoat" or whatever garbage they are trying to upsell you on that can't be removed. It's basically an industry that barely modernized their process in the last 20 years.

God help you when you get to the final boss, aka the finance person. Then you get to find out about warranties for parts you didn't know existed, gap insurance at 5 times the rate of anywhere else, and get to play "find the hidden fees in the contract".

Bring this to the US. I'm done with the dealership model, burn it to the ground, and let's start over.

PS: Clearly this is a trigger for me...

I especially like the $799 dealer administration fee…which they won’t negotiate. That fee has gotten a stupidly out of control. Last deal I made a couple of months ago had two vehicles with nearly identical prices…one dealer charged $399, the other $799. Guess where I made my purchase.

[afadeev]

Originally Posted by F32Fleet

Warranty approval is ultimately approved by the manufacturer or the dealership eats it.

True, but the dealer advocates on your behalf.
The dealer's service center and owner's incentives are aligned - dealer gets paid when warranty is approved, and it is motivated to make the most convincing case for the OEM to approve the repairs.

Without the dealer in the loop, the owner is attempting to make the case for the OEM to approve the repairs at OEM's expense. With, or without knowledge of what's wrong with the car. The OEM has the direct dis-incentive to approve warranty repairs, and knowledge advantage to deny them, unless absolutely necessary or ordered by the court.

The incentive misalignment in DS service model is glaring and unavoidable.

a

[NGT2]

I’d rather keep the dealers. The company will never know who I am or actually appreciate me as an individual. With dealers, you can create a relationship. I love BMW products but two of the big reasons I keep buying them are the relationship with my primary selling dealer and that with my local dealer that services my cars. Both know how to treat the customer.

[Westside Guy]

Originally Posted by BklynNYBMW

Yes, BMW of Manhattan is still around at West 57th Street and 11th Avenue. They have been around for years. As a matter of fact they just did a remodel of their showroom about a year and half ago. I purchased my 2018 340i xdrive and my 2021 M340ix drive from them. I found them very easy to work with and were very accommodating. My M340i xdrive came in 2 months early. They kept it for 2 and half months until the lease was up on the 2018 340i xdrive. I was also able to order the M340i in Tanzanite when it was taken off the color palette on the website. No other dealer was able to get me that color and the combination. But they got it for me. I guess the advantage of being a corporate store.

I am happy that they are still in business. Back in the 90's when I lived in Manhattan I purchased two cars from BMW of Manhattan and starting with the managers down to the salespeople and service advisors I always found my experience there to be outstanding. One reason may be that a major part of their annual bonuses was based on the customer satisfaction surveys that were sent out and they always went out of their way to please me.

[F80Fleet]

BMW already do it here in South Africa

No new car Inventory belongs to the dealers, its all BMW SA's.
We can look up country wide available inventory online, select a car and it will be at any dealer within 1 week or less.
Floor stock is provided to dealers by BMW SA and specced by BMW SA.

Prices are fixed by BMW SA, dealers cannot discount.
Only BMW can run specials.

All production slots belong to BMW SA, so you don't have to find a dealer with an available build slot if you custom order.

For a special limited edition vehicles you have to convince BMW SA to give you a slot, dealers have no say.

[JTK44]

Originally Posted by F80Fleet

BMW already do it here in South Africa

No new car Inventory belongs to the dealers, its all BMW SA's.
We can look up country wide available inventory online, select a car and it will be at any dealer within 1 week or less.
Floor stock is provided to dealers by BMW SA and specced by BMW SA.

Prices are fixed by BMW SA, dealers cannot discount.
Only BMW can run specials.

All production slots belong to BMW SA, so you don't have to find a dealer with an available build slot if you custom order.

For a special limited edition vehicles you have to convince BMW SA to give you a slot, dealers have no say.

This I would prefer to what we have in the states: When I went to order my 2026 540i, there are very few 540i's available and the ones on the dealers lots did not have the options I wanted. The lease quotes for 39 months, 7.5K miles per year varied from above $1100 a month to less than $900 a month. (No money down and all taxes and fees in the monthly lease payment). Because I was willing to do the work and drive an extra 30 minutes I was able to save nearly $8,000 on a 39 month lease!

For most people not willing or able to work the Internet, the direct sales system with a fixed price will inure to their benefit.

[225]

Bound to happen as soon as mini went that route. About mid 2027 would be good as my m60 lease will be up in May 27. The mini dealers were knocking out crazy deals to get rid of stock before the new business model and we got Mrs 225 a very cheap electric mini.

Hopefully bmw dealers will do the same early 2027!