Supercar £ Margins
Discussion
there was a thread a while ago about a Gallardo owner complaining about the huge difference between what he was being offered for his car versus the retail price of similar cars. What are the experiences of owners of Lambos and Ferraris? Which is the worst for high margins? I will hazzard a guess that the Murcielago has to be up there...
Edited by ufoufo on Friday 17th April 13:29
. Losing £55K in two years still makes me shudder.Wow, what a defensive response this thread has caused! I can only assume some people get the needle when reminded about how much they've lost on their cars.
Regarding the original topic, it really is unbelievable what dealers sometimes offer for cars. They may as well preface their offer with 'Bend over Sir'. At the end of the day, you have to remember that dealers are running businesses and not charities and it's, of course, in their interests to purchase stock for as little as possible to offset as much risk as possible and to maximise margins. It is funny, however, how some dealers will come out with 'reasons' for offering such a ridiculously low price and, suddenly, those supposed demerits will become attributes when selling the car on (colour springs to mind)... an 'unpopular' colour suddenly becomes 'rare and sought after' at saletime! Personally, I've never sold to a dealer because I've never been willing to, for want of a better word, be ripped-off. IMO, selling to a dealer is (in most cases) down to laziness. I have a friend with a car to sell but, rather than invest a weekend in cleaning it up and prepping it, then advertising it privately, he'd rather just flog it to a dealer and take the hit, simply because he can't be bothered (his words when I put all of this to him).
Regarding depreciation, the following rules apply:
1) Buy as old as you can live with (older cars have already suffered the worst ravages of depreciation)
2) Buy a saleable colour combo and a car with 'all the boxes ticked'. This will make it far easier to sell-on
3) Do a SMOKING deal when you buy the car! Just look at it this way; a couple of Grand saved on the purchase price will be a couple of Grand saved in depreciation when you come to sell.
Cheers,
Ian.
Regarding the original topic, it really is unbelievable what dealers sometimes offer for cars. They may as well preface their offer with 'Bend over Sir'. At the end of the day, you have to remember that dealers are running businesses and not charities and it's, of course, in their interests to purchase stock for as little as possible to offset as much risk as possible and to maximise margins. It is funny, however, how some dealers will come out with 'reasons' for offering such a ridiculously low price and, suddenly, those supposed demerits will become attributes when selling the car on (colour springs to mind)... an 'unpopular' colour suddenly becomes 'rare and sought after' at saletime! Personally, I've never sold to a dealer because I've never been willing to, for want of a better word, be ripped-off. IMO, selling to a dealer is (in most cases) down to laziness. I have a friend with a car to sell but, rather than invest a weekend in cleaning it up and prepping it, then advertising it privately, he'd rather just flog it to a dealer and take the hit, simply because he can't be bothered (his words when I put all of this to him).
Regarding depreciation, the following rules apply:
1) Buy as old as you can live with (older cars have already suffered the worst ravages of depreciation)
2) Buy a saleable colour combo and a car with 'all the boxes ticked'. This will make it far easier to sell-on
3) Do a SMOKING deal when you buy the car! Just look at it this way; a couple of Grand saved on the purchase price will be a couple of Grand saved in depreciation when you come to sell.
Cheers,
Ian.
Ian, spot on.
Some people are happy to take the hit on a trade-in price, because they can't/don't want to sell privately (or other non trade-in routes, e.g. sale or return). You can see the logic here, as selling private gets you the extra cash, but in return you have the 'work' of the dealer in preparing the car, advertising, dealing with the truck-load of tyre-kickers before a successful sale; and possibly the kick-back if something goes wrong.
Some people are happy to take the hit on a trade-in price, because they can't/don't want to sell privately (or other non trade-in routes, e.g. sale or return). You can see the logic here, as selling private gets you the extra cash, but in return you have the 'work' of the dealer in preparing the car, advertising, dealing with the truck-load of tyre-kickers before a successful sale; and possibly the kick-back if something goes wrong.
the purpose of the thread is not depreciation but to find out which cars have the greatest margins. In other words how much did that £60k retail gallardo cost the dealer compared with how much did the £60k 911 cost the dealer? I am just curious to find out which cars carry the greatest risk of dealers hence will carry the greatest margins. The cars that are more difficult to shift should carry the greatest margins, and if you buy one it will be more difficult and expensive to get out of it.
ufoufo said:
the purpose of the thread is not depreciation but to find out which cars have the greatest margins. In other words how much did that £60k retail gallardo cost the dealer compared with how much did the £60k 911 cost the dealer? I am just curious to find out which cars carry the greatest risk of dealers hence will carry the greatest margins. The cars that are more difficult to shift should carry the greatest margins, and if you buy one it will be more difficult and expensive to get out of it.
I would have thought the margin would go up, more or less in line, with the price... the more expensive the car, the harder (ie. the more time) it will take to shift (generally speaking). The issue is also clouded by an infinite number of other variable (colour combo, miles, history, owners, etc, etc). Your question on margins is linked heavily to depreciation, hence the replies on depreciation. There will ALWAYS be a huge difference between what a dealer offers you for your car versus what they would RETAIL that same car at, regardless of marque!Edited by ian_uk1975 on Sunday 19th April 23:48
IainUK has a good point and i am also suprised by the negative responses. I remember a chap trying to sell his 3month old Gallardo spider for £95k because of the price his Lambo dealership offered to buy it back was a joke - Fair enough you may say, but if i phone Lambo today looking for a 3month old Gallardo Spider, i will be asked to bid £130+ and be told how well the car holds it value and that i wont find better. The dealers cant have it both ways. The LP560 at Dick Lovetts at £135k that he cant shift makes the cars being offered at £160K+ look farcical.
Do i care about my cars future value? Not really but its one of the dealers selling points, especially when dealing with prestige cars. I have heard that Porsche have a £10k mark up on there cars. I have no idea what Lambo or Ferrari are at.
P.S. I think some Lambo dealers will struggle with trying to sell the new LP560 spider fully specced at £170k+, i actually feel sorry for the people that put a deposit on this car that will lose £30k+? the minute it is driven out of the showroom.
Do i care about my cars future value? Not really but its one of the dealers selling points, especially when dealing with prestige cars. I have heard that Porsche have a £10k mark up on there cars. I have no idea what Lambo or Ferrari are at.
P.S. I think some Lambo dealers will struggle with trying to sell the new LP560 spider fully specced at £170k+, i actually feel sorry for the people that put a deposit on this car that will lose £30k+? the minute it is driven out of the showroom.
Edited by Wanta996Gotta on Monday 20th April 11:27
I think you will find the negative responses are more to do with the rather pointless nature of the question rather than concerns regarding depreciation. The point was very well made that margin from dealers is dependent upon so many variables. Each of these will change with time so the answer is simple- dealers are there to make a profit. In good times all other things being equal (which they are not!) they will make good margins and vice versa. So what is the point in asking if margins on one particlular marque or model are higher or lower than others.
We all have choice whether buying or selling to involve a dealer. The fact that they (by and large) continue to exists suggests there are enough people out there who accept the fact that dealers make margins.
How about a new thread "Does Tesco make more margin on baked beans than on bread?"
We all have choice whether buying or selling to involve a dealer. The fact that they (by and large) continue to exists suggests there are enough people out there who accept the fact that dealers make margins.
How about a new thread "Does Tesco make more margin on baked beans than on bread?"
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