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#3837 of 3886 A deer-in-the-headlights look [tidester]
Feb 25, 2009 (3:17 pm)
I am of the opinion that the public is not adequately informed concerning the risks of purchasing vehicles from the Big Three at this point in time. That is the major factor holding me back. Last spring when I bought the early-release 2009 Vibe, I was not concerned. Some ten months later, I am unsure on matters such as warranty enforcement. But because of some radio advertising, I stopped by a local Saturn dealership today. I inquired about the possibility of deep discounts under the current state of the economy and the state of GM. The salesman became quite obtuse and informed me that he had no idea what I was talking about. In short, I left the property wondering just what the future holds for the Big Three and us customers.
#3838 of 3886 Re: A deer-in-the-headlights look [wtd44]
Feb 25, 2009 (3:55 pm)
That's just it. Uncertainty has been injected into the market so people tend to hold off purchasing which creates more uncertainty. A good dose of confidence would be great right about now.
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#3839 of 3886 Re: A deer-in-the-headlights look [wtd44]
Feb 25, 2009 (4:07 pm)
"...I am unsure on matters such as warranty enforcement..."
I had the same thoughts last year when I bought a Mitsu. The media had them dead and buried in the US. I took a gamble, got a good price , and they're still here.
I think gamblers have a saying "scared money don't win".
#3840 of 3886 Stay on the fence...
Feb 26, 2009 (2:19 am)
because it is obvious that the price of cars, especially the big 3, are out of line with what people can/are willling to pay! This is a harsh statement..."I don't think many of the big 3 cars are worth $30K+." A few are, but most are not! Hence, that is just ONE reason of a list of many that is leading to their demise.
I've been in the market for a Dodge Charger, Daytona Edition or SRT-8, and although Dodge is offering huge discounts on the cars IMHO their still not worth what their asking. Why do I say that? Well, if the parent company is about to go bust where is the value in the product? It's just not there! I know we "think" we need the big 3 to survive, but the market is FORCING them to reorganize. The government can pour all the money in the galaxy on them, but it will be " pi$$in' on a forest fire"...let it burn! After the "fire" things will slowly become green again...it's has to happen! It'll hurt, but it will get better.
In conclusion, the dealerships I've come across are in such denial it's sad and scary. Three of the dealerships are still asking $29-34K for a leftover '08! The cars in 2008 stickered for $39K-41K. Now you say whoa! That's alot off, but actually the MSRP is out of line with what the market WANTS to pay. The correct MSRP is $30-32K, this is more in line with what it's worth...new. Of course, some will pay 39-40K, but MOST haven't and won't, therefore, they've come to this crossroad. Think about it for years the big three ALWAYS have the biggest rebates. Why? Because they weren't moving at their list price. Sure the foreign maufacturers offered rebate, but at most $1K off.
Well that's my take on this mess! Of course, it can't be ruled out that I am NUTS for considering a vehicle from a company that could possibly go bankrupt. Hey I like American V-8's!! Not trying to hijack the thread, but I was trying to stay with the flow of the posts.
#3841 of 3886 Re: A deer-in-the-headlights look [tidester]
Feb 26, 2009 (5:51 am)
>Uncertainty has been injected into the market
That uncertainty has been intentionally increased and prolonged for political purposes in my opinion AND it has had an unintended consequence on the automotive market. The Tuesday night oratory included a criticism and indicated support of the US automakers and should increase confidence in their longevity. At least, I hope it does.
#3842 of 3886 Re: A deer-in-the-headlights look [wtd44]
Feb 26, 2009 (5:53 am)
>The salesman became quite obtuse and informed me that he had no idea what I was talking about.
Stop by your local Accord dealer or Lexus dealer and see if they're giving great discounts in these hard times. Nobody is selling what they were.
#3843 of 3886 Re: Stay on the fence... [omegagen]
Feb 26, 2009 (6:27 am)
What you are seeing now is dealers ready to sell at small profit or small loss. Remember, they paid for those cars some amount - if the car sticker is $41K (which of course it was way too high), they probably paid (financed) something like $37K-$38K minimum, probably more unless the mfrs have already gave them some money. The cutomer rebates, dealer incentives, holdbacks and what not come after the sale made, not before.
While you may think the car is worh half of its sticker, but there is no way or incentive for dealers to actually offer that price. It's cheaper for them to pay interest (e.g. 10% APR of $37K is $3.7K/year, not $15K you want them to write off) on the inventory than give that to you. What you want is essentially a liquidation sale, where everything trully must go even at big loss. It may happen, not just yet and not necessarily at your levels (think Circuit City prices in first week of their closing sale).
If you want a true market price, go with slightly used.
#3844 of 3886 Re: Stay on the fence... [dino001]
by kyfdx HOST
Feb 26, 2009 (9:48 am)
Prime is 3.25% now..
Dealers who were in good financial shape heading into this mess probably pay that rate to floor their inventory...
So, that $30K car is only $82/mo. to keep on the lot... While that adds up over time, it isn't enough to incentivize a dealer to knock an extra $1000 off a car, just to get rid of it...
If the manufacturer doesn't add incentives, the dealer pretty much has his hands tied... as far as price..
#3845 of 3886 Re: Stay on the fence... [kyfdx]
Feb 26, 2009 (11:01 am)
That's right. I didn't know dealers could get prime, so I bumped it up. Anyway - it even strengthens my case: they won't sell something half off just because it doesn't sell.
#3846 of 3886 Re: A deer-in-the-headlights look [imidazol97]
Feb 26, 2009 (11:37 am)
The Tuesday night oratory included a criticism and indicated support of the US automakers...
So what are customers to do? Stay on the fence as omegagen proposes?
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