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Dealership Markups (North America)

3DDiY

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Almost every Car dealership around me and I'm sure around most of the country is seeing shortages. All the JLR dealerships are charging 5k above sticker price for any new vehicle. What are the chances you guys think that Dealerships that are going to be selling the Grenadier will have dealership markups. I'm sure they are also in charge of financing. I'm sure at first the network will be limited. Its unlike a person can say I'm not buying it from you and go to another dealer in the area. But then everyone in the area is charging the same markup. Just wondering to see if anyone else has thoughts on this. 
 

Paachi

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I was disappointed as well when the NA CEO of Ineos told us that they will go the dealer route and the fact that they can’t stop dealers from marking up. However a ray of hope is that they are exploring options for avoiding dealer markups for early hand raisers. How that will manifest I have no idea but I’m guessing some quid pro quo for the later iterations especially because for the early hand raisers the dealers didn’t have to do any selling and or marketing. 
 
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They don't have a choice but to go the dealer route. Tesla is only one to not use dealer network. 
 

Paachi

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I think Rivian is also not using the dealer network. Basically some stupid exemption by the government for only electric makers. As daft as it gets IMHO
 

emax

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As far as I understood, the dealers in Germany can not add an extra fee. They get the 280 Euros for the hand-over inspection and that's it, and they get a new customer for future maintenance.

If they'd charge extra money, I'd simply order directly for delivery to my home. And I suspect that others would do so as well.
 
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I live in New Jersey. Was very tempted to order a new Defender from my local Princeton dealer to replace my LR4. The dealer insisted they would not, will not add any extra fees. They said it would be too bad for future customer relations..??I should have bought and flipped a new “James Bond” V8 they told me that in Florida the dealers were charging $95K over list and elsewhere $55k…WTF. 
 

Paachi

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I am clear on one fact that if there is a dealer markup then I’ll walk away from a Grenadier purchase. I expect the manufacturer to take care of these details and not screw the customer over
 

Ferrugenfish

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[QUOTE username=Paachi userid=8372535 postid=1332860097]I am clear on one fact that if there is a dealer markup then I’ll walk away from a Grenadier purchase. I expect the manufacturer to take care of these details and not screw the customer over[/QUOTE]

Same for me.  I'm super attracted to the IG, but refuse to pay more than the already high price.  Unfortunately, someone else probably will.  Either way, I'll just wait until I can get one for MSRP or lower.  I will say though that if I pay a deposit 1.5 years in advance of it hitting dealers, I sure as hell expect no markup.  If I lose my spot in line, so be it... and I'd be insulted by IG for taking my interest free loan for 1.5 years. We'll see!
 

RTG

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This may answer our concern


=AZWdTPny2XHIzzM5N22WVXCJCBVkuTuT33io8h5Dn2-VhkpRzOyunX_4fk0J1Ds0vy0nr0dTQ11KwfOvtyXw9-dwvCdyUV6SudmEaABPMHnNzD4z2qx_dL5C7dwXnDZCraHz-vYcOVvGUVVDdfiFhCva&__tn__=-UC%2CP-R t=_blank]Justin Hocevar=AZWdTPny2XHIzzM5N22WVXCJCBVkuTuT33io8h5Dn2-VhkpRzOyunX_4fk0J1Ds0vy0nr0dTQ11KwfOvtyXw9-dwvCdyUV6SudmEaABPMHnNzD4z2qx_dL5C7dwXnDZCraHz-vYcOVvGUVVDdfiFhCva&__tn__=-UC%2CP-R t=_blank]Ineos Grenadier Owners Australia=AZWdTPny2XHIzzM5N22WVXCJCBVkuTuT33io8h5Dn2-VhkpRzOyunX_4fk0J1Ds0vy0nr0dTQ11KwfOvtyXw9-dwvCdyUV6SudmEaABPMHnNzD4z2qx_dL5C7dwXnDZCraHz-vYcOVvGUVVDdfiFhCva&__tn__=%2CO%2CP-R t=_blank]30 April  Â·  Network & price. Info to help clarify some open points of concern & speculation.INEOS has announced its nominated Agency partners for Aus & NZ. The process of appointing our partners is at Nomination phase, like a HOA announcing our intentions to work together. The process is governed by a code, that we must comply with. The relationship with our Agency partners will be complete once their Agency Agreement is final. This will be complete well before we start demonstrating & delivering new vehicles to customers. Therefore, at this stage, our Partners are not equipped with the facilities, training, systems access & various other tools to perform their role. That is all a work in progress. They are super keen to engage with customers & we do not discourage it, please feel free to reach out and establish relations. In fact, we at INEOS are overwhelmed with the positive response we’ve had to such a great, hand-picked, enthusiastic group of partners. They all bring a lot of experience to the table & are as much part of this Grenadier journey as you or I. We look forward to them being in full-swing and being able to serve your needs.It is important to note, that our partners are Agents. There’s a distinct difference to the traditional franchised, wholesale ‘dealer’ relationship. Under an Agency model, the commercial arrangements are very different & drive different outcomes. For example, all new and demonstrator vehicle inventory is owned by INEOS. Only INEOS can set the price of vehicles & when a customer purchases a vehicle, the contract of sale is with INEOS (as opposed to with a ‘dealer’). Our Agency partners are there to support this process & we will reward them for this function. I’m sorry if I’m repeating old material communicated via the press, but I hope this context helps members of this group to better understand how & why certain things happen. In some respects, it can require a recalibration of expectations or experience.As you are aware, we have now announced RRP and specifications. More detailed specification will follow over time as PTO testing outcomes, vehicle calibration & Type Approval follows (e.g. vehicle conformity with the many global jurisdictions). The configurator is down whilst we migrate to a new e-commerce ordering platform, if you’re a reservation holder, you will have received correspondence as to ‘what happens next’. Complete vehicle pricing, inclusive of all the ORC, will be available when a unique vehicle order is configured to a nominated location. Therefore, calculating the ORC specific to that location (state).We seek nothing more than the journey of discovery to ownership to be as enjoyable as possible. Yet as a start-up auto brand, with a new route to market, there will be twists and turns that raise many questions. We’ll do our best to keep you up to speed.
 

Ferrugenfish

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That sounds promising thank you for sharing! 
 

emax

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That was exactly my understanding for the German dealerships.
 
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Sounds promising! I can only hope the eventuality here in the US is that good.......viewing the issues with dealership groups and govt so far with Tesla, I'm not holding my breath......
 
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[QUOTE username=Guru userid=8878336 postid=1332859246]I live in New Jersey. Was very tempted to order a new Defender from my local Princeton dealer to replace my LR4. The dealer insisted they would not, will not add any extra fees. They said it would be too bad for future customer relations..
1f44d-1f3fb.png
I should have bought and flipped a new “James Bond” V8 they told me that in Florida the dealers were charging $95K over list and elsewhere $55k…WTF. [/QUOTE]

the LR dealer near me was asking $150k markup on a James Bond V8.  It’s no longer there so someone must have purchased it.
 

DCPU

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[QUOTE username=Paachi userid=8372535 postid=1332860097]I am clear on one fact that if there is a dealer markup then Iâll walk away from a Grenadier purchase. I expect the manufacturer to take care of these details and not screw the customer over

Same for me. I'm super attracted to the IG, but refuse to pay more than the already high price. Unfortunately, someone else probably will. Either way, I'll just wait until I can get one for MSRP or lower. I will say though that if I pay a deposit 1.5 years in advance of it hitting dealers, I sure as hell expect no markup. If I lose my spot in line, so be it... and I'd be insulted by IG for taking my interest free loan for 1.5 years. We'll see!
[/QUOTE]

You can't really hold Ineos accountable for state/federal legislation that forbids them from operating a business model that would guarantee no markups.

Seems strange in the US of all places, a model that could bring benefit to consumers cannot at least be put into the open market and then we could all see if it stands or falls on it's own merits.

I've seen it reported that "The cost of the auto distribution system in the United States has been estimated as averaging up to 30 percent of vehicle price." 😳
 

Caladan

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Because INEOS is new to automotive production and retail, we can all be hopeful about pricing. However, there is nothing occurring in the U.S. auto market today that would support it. I also have an order for a Ford Bronco Badlands on the books (coming up on 8 months of waiting to hear when my truck will be scheduled for build), and we have a forum just like this. Actually two forums (BroncoNation and Bronco6G). On both forums, you can find an updated list of "Bad Dealers" who originally committed in writing (Purchase Order Agreement) to sell the truck at MSRP plus tax, title and delivery, accepted the orderer's down payment and then, when the truck was finally built/delivered, turned around and whacked the buyer with $5-$30K in Additional Dealer Mark-Up (ADM). Lots of anger and frustration! The list is maintained up-to-date (including outcome of each particular situation) and serves to help new orderers to avoid those bad dealerships.

Of course, none of us are going know who are good/bad dealers here in the U.S. this early in the game. But I suspect we will all find out that the game will be the same: some good dealers and some bad.
 
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This is a big concern of mine. If dealing with dealerships isn't a pain enough, I have watched how the Bronco roll-out has gone and just been dumbfounded. If I ultimately pull the trigger on placing an order on one of these, I would not accept waiting it out only to be surprised with ADM at delivery.

I see Ford is going the price guarantee route with their new electric division, so seemingly Ineos could do the same. Need to see some firm commitments in that regard before placing an order though.
 

Caladan

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This is a big concern of mine. If dealing with dealerships isn't a pain enough, I have watched how the Bronco roll-out has gone and just been dumbfounded. If I ultimately pull the trigger on placing an order on one of these, I would not accept waiting it out only to be surprised with ADM at delivery.

I see Ford is going the price guarantee route with their new electric division, so seemingly Ineos could do the same. Need to see some firm commitments in that regard before placing an order though.
As I read about the experiences of Grenadier buyers in Europe, it appears that the purchasing model is different. Yes, there is a sales agent but the contract the buyer signs appears to be directly with INEOS. So, the pricing seems to be fixed and the sales agent isn't able to tack on "extras". Of course, it remains to be seen how the INEOS purchase model will work here in the U.S. That's why I'm very interested in visiting one of those 35 dealerships reported to open here.
 
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I think Rivian is also not using the dealer network. Basically some stupid exemption by the government for only electric makers. As daft as it gets IMHO
There is no exemption for electric vehicle manufacturers. The regulations are on a state-by-state basis, intended to protect the financial interests of car dealers who have purchased the votes of state legislators. Tesla and others have been creative to get around the regulations where they can, such as Tesla dealerships on Native American land in New Mexico.
 

Shopkeep

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Be careful what you wish for. The system Ineos (and others) uses might stop dealers from charging additional markups, but it also removes any ability to offer a discount to gain your business. Nothing motivates a retailer of any type of goods more than having a whole bunch of cash tied up in inventory sitting in your warehouse or on your lot.

I view it as a restrictive trade practice and anti free market, I would have thought it was very in character for US States to reject this model of business.
 

DaveB

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Be careful what you wish for. The system Ineos (and others) uses might stop dealers from charging additional markups, but it also removes any ability to offer a discount to gain your business. Nothing motivates a retailer of any type of goods more than having a whole bunch of cash tied up in inventory sitting in your warehouse or on your lot.

I view it as a restrictive trade practice and anti free market, I would have thought it was very in character for US States to reject this model of business.
The only car companies in Australia offering discounts anymore are the ones selling vehicles nobody wants to buy.
 
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