[czstar]

There’s a lot of justifiable hate against dealerships but I think the hate against them for markups is not justified. Clearly there are people willing to pay above MSRP. If the dealerships don’t markup the vehicles then scalpers will buy at MSRP and resell the vehicles at a markup. As bad as the dealership experience is there is less chance for fraud or theft at a dealership than from a scalper.

In a lot of places there are two scenarios in the local car market. One dealership will sell at MSRP but you’ll have to wait 4 to 6 months. Another has inventory but at a significant markup. You can buy now and pay more or wait a while and pay less. Choose the option that fits your situation. Of course, the best option would be to properly fund public transportation.

[AlphaSite]

I don’t know if car scalping is a major thing, the risk reward doesn’t really work out IMO and arguably the dealership is the one doing the scalping…

[czstar]

Car scalping is a thing and it would be a much bigger thing without dealership markups. The markups at the dealership means a smaller market for scalpers. In the absence of dealership markups there would be more scalpers.

https://www.motorauthority.com/news/1136687_gm-threatens-dea...

[cptskippy]

Markups are just scalping with fewer steps.

[czstar]

That is precisely the point I was making. The dealership becomes the scalper. Would you rather pay the scalp price at a dealership with the accompanying regulations and laws surrounding that transaction or pay the scalp price from someone you don’t know with much fewer regulations accompanying that transaction? The scalp market exists. I think it’s better to have that market at a dealership than from people you might not be able to track down in the case something goes wrong.

[r00fus]

The ironic thing is that what Ford really wants is to for Ford to capture those markups, not the dealers.

They want what Tesla is already doing.

[trixie_]

Tesla has a year backlog and no scalper issue. So it’s not that.

[czstar]

Tesla has significantly increased prices and such an increase lowers the ability of scalpers. I don’t know about Tesla’s policies on warranty transferability and I don’t know if that plays into things. Unlike other cars Tesla can remotely disable a car so maybe the secondary market for Teslas is different. I don’t know.

There are definitely scalpers for other brands. People are special ordering Mavericks from Ford and get them after 6 months or so and then reselling.

https://electrek.co/2022/06/15/tesla-tsla-increases-electric...

https://www.motorauthority.com/news/1136687_gm-threatens-dea...

https://www.carsdirect.com/automotive-news/industry-news/for...

[trixie_]

Increasing prices has nothing to do with scalping.

Just like Microsoft and Sony should of done with game consoles, but never did - Tesla has centralized buying which allows it to easily prevent scalping.

[czstar]

I don’t think you understand the market forces at play if you really believe this. If product A sells at MSRP direct from the company that produces it for $x and people are willing to pay $y for it where y is sufficiently bigger than x then there will be a reseller market for the product. If y is close enough to x then there won’t be much of a reseller market. Of course if the company has the ability to otherwise diminish the value of the product post sale then that too can distort the reseller market should the company use its power to do so.

Increasing prices has much to do with whether or not there is a reseller market. You are very much wrong.

[trixie_]

It's one thing when scalpers jack up prices, but when companies do it it's called price gouging.

I haven't seen Sony, Microsoft, Ford, Tesla, gas stations, etc.. raise their MSRP to deal with scalpers, only inflation.

I have real examples that prove you're point wrong.. do you have examples that help prove you're even slightly right?

[czstar]

You should about market dynamics and pricing power and whatnot. When there is an imbalance between MSRP and what buyers are willing to pay there, provided the latter quantity is sufficiently bigger than the former, then an opportunity arises. Someone along the chain will seek out the potential profit. Tesla has massively raised prices. So what if their public statement is that it is because of inflation? The publicly stated reason matters not. What matters is that they raised their prices in accordance to market forces.

There is a large reseller market for PlayStation 5 because the price Sony sells at is much less than what the market is willing to pay. So scalpers step in seeking the potential profit. There are a number of reasons Sony doesn’t raise MSRP. The main one being goodwill and future buyers. If they raise their prices to $1,0000 the psychological effect will be long term detrimental. So they don’t raise prices. But there is a market for scalpers because of this.

I’ve posted links demonstrating there is a scalper market for some new cars. Indeed, dealerships are often times, in effect, becoming scalpers by raising prices. If all dealerships sold at MSRP this would not benefit consumers in the least. Scalpers would just take over and buying a car from a scalper is a lot worse than buying it, at a premium, from a dealer.

Call it price gouging, scalping, theft or what have you. The words used don’t matter. All that matters is that there is enough potential profit to be had at the imbalance between MSRP and what buyers are willing to pay for cars that someone will be attempting to take that profit. It’s either going to be the manufacturer (Tesla), the dealer, or a third party.

[namelessoracle]

Microsoft and Sony both sell direct and both implement anti scalping technology into their direct sales. (only allowing one purchase per registered account, IP detecting technology to make sure same user isnt buying over and over, et cetra). Sony got me a PS5 launch day direct ship to home at no additional cost within 12 hours after purchase (I was pretty impressed that Sony was able to pull that off)

They just dont want to burn their bridges with traditional retailers quite yet Im guessing.

[FireBeyond]

> If the dealerships don’t markup the vehicles then scalpers will buy at MSRP and resell the vehicles at a markup. As bad as the dealership experience is there is less chance for fraud or theft at a dealership than from a scalper.

Dealerships are absolutely doing this themselves - create a shell company, sell to their own shell company for MSRP, sell back to the dealership at MSRP, now you get to report a compliant sale to the manufacturer, and you have a "used" vehicle on your lot with <100mi that no-one can tell you not to sell for $20K above MSRP.

[czstar]

The fraud/theft I was talking about is seller striping the vehicle of parts and putting in used third party parts and reselling the original parts. Things like that aren’t done at the local Ford dealership. Well, there’s less chance of that. My point is that dealerships are effectively the scaler and it’s better to pay the scalp price at the Ford dealership than from some random person. At least in general.