- Vehicle buyers hunt hard for a fair price, and don’t respond well to dealers with new and used vehicles priced 10 percent to 20 percent higher (or more) than the same/similar cars in their markets for no apparent reason.
- Dealers need to recognize that age- and market-related adjustments result in faster retail sales, which affords them the right to earn additional inventory from their factory partners.
- In today’s market, margins are too thin, and time is too precious, to allow common misunderstandings about new and used vehicle prices to get in the way of tomorrow’s retail sales.
Old beliefs and habits definitely die hard.
Take the way many dealers still think about their new- and used-vehicle prices:
Dealers control vehicle prices
I’m not talking about the obvious point that dealers do, in fact, largely set the asking prices for their vehicles. My point relates to the ever-more powerful influence the market has on a dealer’s latitude to price vehicles the way they really want to. Some dealers have let this one go entirely. They’ll price their vehicles based on what the market data tells them — no more, no less. They recognize they can’t control or make the market for a vehicle. They understand the market dictates if the car’s a winner or loser, or lies somewhere in between, and they should price accordingly.