car salesmen

talked to our saleslady at the Ford dealership in Houston.

she made $526k last year. She showed me her W2.

she makes 10% vig on the margin a car sells for.

they sell f250's for 18k margin...minimum. that's 1800 a car.

and she says there is no haggle. do you want the truck or not, because there are 25 people behind you waiting.

I was floored.

THAT'S the problem..nobody has an incentive to drop the price....and it won't end soon.

 

She’s going to love her tax bill in a few months.

This is how supply and demand works. Makes me wonder if the OEMs will ever go back to the old mass production mantra.

 

good point.

performance ALWAYS follows the incentive.

 

The taxes are still well worth the extra income.

 

I hope she puts a big chunk of that in savings

 

damn right.

 

That margin has to include the additional dealer markup that’s going on now. They’re enjoying it while they can.

 

said she bought her daughter a Denali for her wedding.

she also mentioned she does not see it slowing down.

 

Spoiler alert: She probably won’t.

 

As my CPA always says - if you owe a lot of taxes it means you made a lot of money. Be smart and pay estimated quarterly or set money aside for when the tax bill comes.

 

Ford dealer...Houston.

Probably about like being in real estate in Austin.

 

exactly...now why would they stop it?

only market pressure could remedy it. i.e. more inventory.

 

Crazy

 

Can't say I begrudge a person taking advantage of current market conditions. People are willingly paying stupid prices. It's not like salespeople are putting a gun to people's head and telling them they have to buy a car. Probably 95% of people buying now don't actually need to.

It does amuse me though, I've seen a bunch of people bitching about high sale prices and salespeople making too much money but they're so stoked to brag about how much they got when selling or trading in their 5 year old vehicle.

 

Inventory will be what does it. When you’re going to sell everything you have no matter what, there’s no reason whatsoever to lower the price. Once dealers have inventory that isn’t moving the second it hits the lot they’ll have to start competing again. Availability is the the only differentiator right now.

I don’t blame them at all for getting what they can, especially since sales are down. You either make your money on bulk or margin.

 

Why would she show a rando her W2?

 

How dare you be reasonable.

 

are you assuming rando?

 

Think about the manufacturers incentives for this to continue. Less employees to manufacture, less warranty claims, less product liability. Same profits.

 

You didn't mention you know her.

 

Mmmm. That ^^^ system was ever-so-intertwined with plant union labor rules.

So how does the "no more dealer lots full of cars & trucks" model work with the labor unions? I dooooooooooooooooooooooon't think we're even close to the answer yet. But one thing is for sure: a hell of a fight is coming.

 

so..."our saleslady" wasn't enough?

to expound...been dealing with her for 10 years.

she has not always made that much...

 

Wti solidly in 90s.

running joke in oil industry is f250 sales are pegged to oil price.

gonna be a barn burner when bonuses and tax returns hit.

 

Apparently not.

Sorry to offend you with the term "rando"?

 

none taken.

 

Sorry. Let me try again. Ahem...

*deep breath*

What the hell!? That's fucking insane! No salesperson is worth half a million bucks a year, especially not when all they do is push papers across the desk for me to sign. Shit, they're not even playing the "let me ask my manager" game anymore. Unreal. This is out of control. Somebody should do something, a law should be passed making it illegal to profit more than $50 on a vehicle. I should also get 99% of original MSRP as trade in on my 10 year old shitbox with 300,000 miles because that's fair. It's even worse when I'm bored of my 2 year old truck and want the latest and greatest model. Hell, they should be paying ME! I can't even. It's not fair. I WANT MY MOMMY!!!

 

Or less demand.
Of 17+ trucks I’ve owned over 50 years, only 3 were bought new. I kept those; #1, 9years, #2, 14years & #3 I still have and will probably have when I die. If people didn’t think they needed the latest and fanciest, every 2 to 3 years, that whole sales model would collapse. It’s a lot like selling worthless Diamond jewelry for Valentine’s Day.

 

This is exactly why he punted you across the border.

 

A growing number of dealerships around here have gone to the "no-haggle" pricing on new and used cars, and subsequently they've gone to a straight salary for the salespeople as well. A couple years ago that seemed like a good idea...I'm wondering how many of those salespeople are seeing the $ floating around now and trying to move back into commissioned sales?

When I sold cars (Toyotas, 2000...that lasted about 6 months lol) the margins and commissions were garbage. Plus our dealership kind of stunk for the salespeople unless you were buddy-buddy with the owners. Went back to college instead

 

This is good but more profanity would've sealed an Oscar...

Proviso: you can use *** for vulgarity