Why do dealerships take cars home

Why do dealerships take cars home

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Discussion

treeroy

564 posts

86 months

Monday 29th June 2020
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Onelastattempt said:
My local Ford dealer lost a sale because of this, spotted he had a 2016 Fiesta ST200 up for sale and my son was looking for one. We made an appointment to view it, got there to be told car was not there as one of the managers had borrowed it for the weekend.
Salesman then told us we could leave a deposit on it if we wanted, we just looked at him as if he was stupid and walked out.
Found another 2 ST200s at car supermarket 40 miles away, phoned them up, when asked if the cars were actually on site they said of course they are, where else would they be?
Drove down , viewed and drove both cars and they got the sale, that's why you have the car you advertised for sale available, not being ragged around by some manager who thinks it's more important for him to have a different car to play with every weekend instead of having it ready for sale to someone who has actually made an appointment to view it .
Why do you care who has driven the car?

Why is it any different from other customers having test drives in it? Or for that matter any different from the garage driving it when it gets serviced etc

Mexman

2,442 posts

85 months

Monday 29th June 2020
quotequote all
They all sell eventually.
You can lose a sale to your "discount for cash mate", which makes you very little, and next day sell it full up, on finance with a nice Px and suddenly the deal that you lost to your cash buyer yesterday, is a Godsend.
Your first deal is not necessarily your best deal.

ukaskew

10,642 posts

222 months

Monday 29th June 2020
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lord trumpton said:
We used o have neighbours who the bloke was a delaer principle for Audi local dealer and he usually came home in an RS version of some model every day.
Have a couple of people who work at main dealerships near me (not management), only ever performance variants that come home (daily), seems like quite a lot of mileage to be putting on what are presumably higher profit vehicles.

That said, seeing the i30N every day has made me consider one.


Edited by ukaskew on Monday 29th June 10:53

Mexman

2,442 posts

85 months

Monday 29th June 2020
quotequote all
Demonstrators are usually the higher end of trim level, to impress or entice a customer when they are on demo.
Your not gonna impress someone by wheeling around your povvo spec, wheel trimmed, windy windowed, non air con, XYZ car in Doom Blue, to the front door of the showroom.
I would have thought this would have been bloody obvious.? rolleyes

james_zy

226 posts

57 months

Monday 29th June 2020
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vikingaero said:
james_zy said:
sebdangerfield said:
They didn't 'lose' a sale though did they? They just didn't sell it to you. I'm utterly certain that they still sold the car and they're probably OK with that given that someone who refuses to buy a car just because it's not at the dealership be it out on extended test or with a sales person is probably going to be a royal pain to deal with.
Sorry mate but the moment you start thinking "I can just sell this car/house/investment/widget to the next guy" as a defence for a lost sale is the moment that you stop being a salesman. You whole raison d'être is not to be the guardian of the keys to a test drive, the filler in of forms and the wearer of pointy shoes, but to actually shift sales out of the door.

If someone comes in the dealer with the slightest inkling of making a purchase and you can't get them at least in the car, then you have failed in my opinion.
Agree with you on this James.

What Seb has said is rather disingenious. Yes they lost the sale to you, but how do you know it was sold to the next guy? That car could have sat on the forecourt for 6 months or still be for sale a year later. In the meantime, you've delayed the process of getting new stock in to replace the car that could have been sold.
Exactly, with all volume manufacturers (i.e. the majority of the market), the factories are open for a certain amount of weeks and produce a certain amount of cars. They need dealers to shift this inventory - if they can't, then come in the lease deals and dealer incentives. You only have to look at the incentive pay structure of a dealership to realise that this is the case (quarterly quotas, bonuses for meeting quota).

It's a fiesta for Christs sake not a Maserati - the fact that there are 3 identical models in the vicinity tells you that it's yours to lose as a salesman. One of you are going home with the commission, the others are bhing about it on the internet saying they didn't need the customer and it can wait. Stop making excuses and close the sale.

james_zy

226 posts

57 months

Monday 29th June 2020
quotequote all
Mexman said:
Demonstrators are usually the higher end of trim level, to impress or entice a customer when they are on demo.
Your not gonna impress someone by wheeling around your povvo spec, wheel trimmed, windy windowed, non air con, XYZ car in Doom Blue, to the front door of the showroom.
I would have thought this would have been bloody obvious.? rolleyes
Surely makes the job of selling the car with optional extras easier - difficult to say how much you want the £1500 pano roof if you haven't seen it in person.

21st Century Man

41,028 posts

249 months

Monday 29th June 2020
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Anyone remember Daewoo? They had a seperate fleet of demo cars at the outlet, generally one of everything, not just say a Lanos, but nearly every configuration, 1.4, 1.6, manual, auto, all through the range. Senior outlet staff had a full time company car that was not a demo, it was exclusively theirs. Staff who didn't have a company car could lease a car for 1% of the retail price per month, fully expensed bar fuel. They also had a huge courtesy car fleet.

"I want to drive a Nubira 2.0CDX estate auto".

"Certainly Sir, what colour would you like to drive?"

"White!"

"No problem, we've got three of those, do you want it all day?"

GTiWILL

780 posts

79 months

Monday 29th June 2020
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21st Century Man said:
Anyone remember Daewoo? They had a seperate fleet of demo cars at the outlet, generally one of everything, not just say a Lanos, but nearly every configuration, 1.4, 1.6, manual, auto, all through the range. Senior outlet staff had a full time company car that was not a demo, it was exclusively theirs. Staff who didn't have a company car could lease a car for 1% of the retail price per month, fully expensed bar fuel. They also had a huge courtesy car fleet.

"I want to drive a Nubira 2.0CDX estate auto".

"Certainly Sir, what colour would you like to drive?"

"White!"

"No problem, we've got three of those, do you want it all day?"
...and look how that worked out for them!

Dae who??

21st Century Man

41,028 posts

249 months

Monday 29th June 2020
quotequote all
It worked out very well, it was a huge success in the UK, target was 1% of the UK market in five years, they got that by the end of the first year and in many areas had 5%. The problems were in Korea, centred around their recession and GM taking a controlling stake again. GM closed the wholly owned UK distribution network of factory shops and franchised it back to a dealer network.

GTiWILL

780 posts

79 months

Monday 29th June 2020
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CRA1G said:
edc said:
Really? Take expensive new stock, drive it to deliberately drive down the value and cost so you can do that amazing thing that all sales and business people want to do which is sell for less than they could have? Seems like a long winded way to simply offer a discount!
Naivety is bliss.....rofl dealers get a huge discount from the manufacturer to register demos which they can't sell until they've done 2,000 miles. So it's in the dealers own interest to put miles on the car demo or not so they can then sell on and make a PROFIT......clap
What sort of demonstrator write back bonuses do manufacturers get then? Do/did you work in the motor trade?

vikingaero

10,491 posts

170 months

Monday 29th June 2020
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GTiWILL said:
...and look how that worked out for them!
Top slot on Top Gear with Star in a Reasonably Priced Car!

GTiWILL

780 posts

79 months

Monday 29th June 2020
quotequote all
21st Century Man said:
It worked out very well, it was a huge success in the UK, target was 1% of the UK market in five years, they got that by the end of the first year and in many areas had 5%. The problems were in Korea, centred around their recession and GM taking a controlling stake again. GM closed the wholly owned UK distribution network of factory shops and franchised it back to a dealer network.
I think we’ll have to disagree on what constitutes “working out very well.”


GTiWILL

780 posts

79 months

Monday 29th June 2020
quotequote all
vikingaero said:
GTiWILL said:
...and look how that worked out for them!
Top slot on Top Gear with Star in a Reasonably Priced Car!
Not relevant, but my mum had a 52’ plate Daewoo Matiz in Sprout Green which I drove for a while after passing my test. It was better than being a bus wker, but not by a lot.

austinsmirk

5,597 posts

124 months

Monday 29th June 2020
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the last brand new car I got for my wife- can't fault the dealer, he lent me an identical one and gave it to us for the week to try out to see if she liked it.

alternatively you know how dealers say, if you've seen it elsewhere in the UK, in our stock, we'll have it shipped to you for free- well indeed, I saw a car I wanted- perfect by mileage, spec, price. they had it shipped from somewhere daft like portsmouth to yorkshire.

I turn up excited ready to buy: one wing mirror smashed off, 4 mismatched chinese ditch finder tyres, mileage was say 20k instead of 10k and I could spot the imprint of the ex euro hire car sticker on the boot.
"don't you think you should have told me it was a hire car"
"no, that's irrelevant! "
"well as if anyone is going to buy an ex hire car- or least not want to know to make a considered judgement".


another gem- bloke didn't even have a stock sheet or list and was trying to find his cars on the lot, via the autotrader app.

CRA1G

6,575 posts

196 months

Monday 29th June 2020
quotequote all
GTiWILL said:
What sort of demonstrator write back bonuses do manufacturers get then? Do/did you work in the motor trade?
I'm semi retired now having been in the trade for over 40 years... was DP in my early years before starting my on business.I remember Vauxhall dealers getting manufacture incentives on demos which they couldn't sell until they'd done iirc 2 or 3000 miles sometimes a salesman would do a deal on a car that was maybe 500 miles short so the DP would give it to which ever salesman had the day off to quickly put miles on it as Vauxhall would do regular audits.i used to buy direct from Hertz rent a car in Manchester who had a similar deal with Ford but that was on age not mileage they couldn't sell them until they were 6 months old,I was buying Fords from them and on occasions were 6 months old with delivery mileage on them for trade money and Hertz were making a profit because of the huge discount Ford gave them.

21st Century Man

41,028 posts

249 months

Monday 29th June 2020
quotequote all
GTiWILL said:
21st Century Man said:
It worked out very well, it was a huge success in the UK, target was 1% of the UK market in five years, they got that by the end of the first year and in many areas had 5%. The problems were in Korea, centred around their recession and GM taking a controlling stake again. GM closed the wholly owned UK distribution network of factory shops and franchised it back to a dealer network.
I think we’ll have to disagree on what constitutes “working out very well.”
Daewoo motor was sold off because of legislation that broke up the Chaebols after the big Korean recession of 97. The UK operation was a huge success, but that didn't save it. There were all sorts of issues around politics and distribution ideology, with GM backing the franchise model. They're still Korea's third largest.

https://en.wikipedia.org/wiki/GM_Korea



anonymous-user

55 months

Monday 29th June 2020
quotequote all
austinsmirk said:
I turn up excited ready to buy: one wing mirror smashed off, 4 mismatched chinese ditch finder tyres, mileage was say 20k instead of 10k and I could spot the imprint of the ex euro hire car sticker on the boot.
"don't you think you should have told me it was a hire car"
"no, that's irrelevant! "
"well as if anyone is going to buy an ex hire car- or least not want to know to make a considered judgement".
Surely the majority of cars at a car dealer are either ex hire cars, ex lease cars or ex Motability? Where do you think all those thousands of run of the mill cars come from, I very much doubt many private individuals are purchasing brand new Fords, Vauxhalls, Kias, Renaults, Hyundais etc.

GTiWILL

780 posts

79 months

Monday 29th June 2020
quotequote all
CRA1G said:
I'm semi retired now having been in the trade for over 40 years... was DP in my early years before starting my on business.I remember Vauxhall dealers getting manufacture incentives on demos which they couldn't sell until they'd done iirc 2 or 3000 miles sometimes a salesman would do a deal on a car that was maybe 500 miles short so the DP would give it to which ever salesman had the day off to quickly put miles on it as Vauxhall would do regular audits.i used to buy direct from Hertz rent a car in Manchester who had a similar deal with Ford but that was on age not mileage they couldn't sell them until they were 6 months old,I was buying Fords from them and on occasions were 6 months old with delivery mileage on them for trade money and Hertz were making a profit because of the huge discount Ford gave them.
Thanks for that, quite insightful.

I’ve been in the trade for 13 years. The demo write back bonuses our franchise receive are extremely small. I do hear stories of the ‘good old days’, when manufacturers seemed to be throwing money at dealerships in the late 80’s, early 90’s. Perhaps times have changed, and the manufacturers have tightened their belts somewhat?

otolith

56,448 posts

205 months

Monday 29th June 2020
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A1VDY said:
What possible difference does it make whether one owner or two??
Its how well a car has been looked after and overall condition.
One owner means nothing. One really bad careless owner or three fastidious owners?
I bet that's exactly what you say to someone who wants to trade in a car with a few owners...

Deep Thought

35,919 posts

198 months

Monday 29th June 2020
quotequote all
otolith said:
A1VDY said:
What possible difference does it make whether one owner or two??
Its how well a car has been looked after and overall condition.
One owner means nothing. One really bad careless owner or three fastidious owners?
I bet that's exactly what you say to someone who wants to trade in a car with a few owners...
I dont think CAP asks for number of owners? And i dont think any Approved Used schemes specify a maximum number of owners either.



Edited by Deep Thought on Monday 29th June 13:55