Something being "supported by market conditions" is not a valid test for reasonableness. During disasters for example, all manner of unethical practices can be "supported by market conditions". Yet we enact laws against those things for good reason.
You also seem to forget the fact that much of those market conditions are a result of anti-competitive and anti-consumer laws guaranteeing their the status a middle men by force.
If for example consumers were able to buy directly from manufacturers but chose to pay more at a dealership because they thought the extra cost was worth some surplus value provided then you might have a point.
When market conditions dropped the price of gas in 2020 to record levels because demand was so low and supplies were high, I didn’t see people claiming we shouldn’t let gas stations do that because it enticed people to buy gas.
You seem very intent on defending this sort of behavior. I wonder why?
In my not so humble opinion, while the used market can do what it may, MSRP is MSRP. This goes for GPUs as much as it goes for cars. I understand shortages. I am ok with waiting lists. I do not appreciate profiteering. Any dealership that tried to stick me with such a markup not only would blow the sale, but would not get my business in the future.
I guess I don't get why people think they should be immune from paying a market price.
When you negotiate salary do you go for the most you can negotiate? Or do you accept minimum wage because someone somewhere suggested it to you? Why do you think any other transaction should be different? It's a brand new luxury SUV, it's not baby milk.
> MSRP is MSRP
Guess what... the MSRP includes profit (gasp!). As much profit as they thought they could get away with when it was set.
> Any dealership that tried to stick me with such a markup not only would blow the sale, but would not get my business in the future.
Ok so great this already limits how much they can charge. I guess someone else somewhere is willing the pay the price though, or they wouldn't charge it.
I think your logic is basically 'I don't want to pay that much'. Ok well they don't want to sell it for less, and it's their property. You'll have to go elsewhere. Sounds like you're happy with that so what's the problem?
> Any dealership that tried to stick me with such a markup not only would blow the sale, but would not get my business in the future.
Which is a completely valid reaction and the risk the dealership takes, and ultimately when the price rises to the point where they no longer attract buyers, the market corrects. That will be soon as the fed raises interest rates.
Market conditions explain the higher price, but why does the extra money go to the dealership rather than the manufacturer? I think something other than the market is at work here.
It's because they're collecting rents from having state legislation pretty much guarantee they're the only way to buy a car brand (other than Tesla). And though collusion might be hard to prove, it's pretty obvious to a shopper that the price transparency from the Internet is just as potent a weapon for dealers as it is for shoppers.
People are also buying up all the inventory of available cars and flipping them at CarMax for a profit. Look on CarMax and you see loads of brand new cars with 3-6K markup. That's who the dealerships are competing with.
The market conditions are set by the number of people trying to buy the cars and how much they're willing to pay.
The dealership meets the market price, not sets it. If their fee was unreasonable people would buy other cars until the dealer dropped their prices to something reasonable.
People don’t want to buy other cars just because the dealers are colluding and raising the prices despite adding no value.
When they do decide to avoid a car just because of the leeching dealerships, it hurts the manufacturer too
You also seem to forget the fact that much of those market conditions are a result of anti-competitive and anti-consumer laws guaranteeing their the status a middle men by force.
If for example consumers were able to buy directly from manufacturers but chose to pay more at a dealership because they thought the extra cost was worth some surplus value provided then you might have a point.