Sti MSRP (or markup) lists?
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Well said.........I think people need to wake up to the reality of a supply-and-demand situation with the STi.
My advice to anyone contemplating an STi purchase (in the near future i.e anytime in '03) would be to get the best price they can (comfortably afford) IN WRITING as soon as possible.
To be honest, if you're not already high-up on a waiting list already, I think it's highly unlikely you'll get one in '03 anyway without paying huge mark-ups.
My advice to anyone contemplating an STi purchase (in the near future i.e anytime in '03) would be to get the best price they can (comfortably afford) IN WRITING as soon as possible.
To be honest, if you're not already high-up on a waiting list already, I think it's highly unlikely you'll get one in '03 anyway without paying huge mark-ups.
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Lance,
Again, you bring up excellent points. If you suggested the scenario above where the price was 45k, then I wouldn't buy it. We are all looking for cars in the right price range (ie what we can afford). I have enough to buy the Sti, but don't think that the cars price should be inflated just because some dealer says it should. Subaru incorporates supply and demand into their car prices, but they also take into consideration the work that was done in procuring materials, manufacturing, design, etc. This is what I think is the optimum price and that is the price I will pay (given that I can afford it).
edit- One more thing.. The point of the EVO and the Sti are to be relatively inexpensive pocket rockets that can run up there with the bigger fish. Marking the car up 20k over MSRP totally defeats the purpose of what the car was supposed to be when the designer of the car started it. They did it to the Z in it's last days (ended at 40k?), the Supra, 3000GT and the RX-7. I don't want the same scenario happening again.
Since you are a factory rep, I want to ask you some stuff. What is telling the dealer to set the price at say, for example, $20,325 over MSRP? Sure it's supply and demand, but where does the dealer get his numbers from? The accountant? The CPA? I'm curious.
In your house scenario, I would hold off selling the house until somebody offers the 200k price. I would sell it at a readjusted price if I were desperate. My dad has been waiting to sell our house for 10 years now...
Tim
Again, you bring up excellent points. If you suggested the scenario above where the price was 45k, then I wouldn't buy it. We are all looking for cars in the right price range (ie what we can afford). I have enough to buy the Sti, but don't think that the cars price should be inflated just because some dealer says it should. Subaru incorporates supply and demand into their car prices, but they also take into consideration the work that was done in procuring materials, manufacturing, design, etc. This is what I think is the optimum price and that is the price I will pay (given that I can afford it).
edit- One more thing.. The point of the EVO and the Sti are to be relatively inexpensive pocket rockets that can run up there with the bigger fish. Marking the car up 20k over MSRP totally defeats the purpose of what the car was supposed to be when the designer of the car started it. They did it to the Z in it's last days (ended at 40k?), the Supra, 3000GT and the RX-7. I don't want the same scenario happening again.
Since you are a factory rep, I want to ask you some stuff. What is telling the dealer to set the price at say, for example, $20,325 over MSRP? Sure it's supply and demand, but where does the dealer get his numbers from? The accountant? The CPA? I'm curious.
In your house scenario, I would hold off selling the house until somebody offers the 200k price. I would sell it at a readjusted price if I were desperate. My dad has been waiting to sell our house for 10 years now...
Tim
Last edited by samurai; Mar 12, 2003 at 04:49 PM.
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Well I think maybe you're still missing my point.
It's not the DEALER who sets the price, it's the MARKET that sets the price. The dealer is testing the waters, if nobody bites it's overpriced and they reduce the price until the car starts to sell. A dealer only ASKS a certain price, they don't hold a gun to somebody's head to buy at an inflated price.
I'm not a rep anymore I left the industry about 3 years ago.
But from my experience (and this can vary from one manufacturer to another depending on how their franchise agreements are worded and different state laws) the manufacturer NEVER tells a dealer what to sell the car for. Due to some laws that I don't remember the detail on it can constitute price fixing.
Your example of your Dad waiting 10 years is interesting. You say you would hold out for the 200K. Then why shouldn't a dealer hold out for a premium or MSRP or whatever HE THINKS the price SHOULD be? I think you're exhibiting a double standard here. Your Dad waiting 10 years is his prerogative as it is the dealers. OR he could take the price that is being offered such as the dealer could. There could be tradeoffs though. What if you're dad listed your house for 200K, someone offers you 175 and he turns it down. Then the market drops out and it's only worth 150? OR he's waiting 10 years for a small difference in price and during that whole time he's missing out on unloading his house and possibly buying a new and better one. If a dealer was that stubborn he would be out of business fast. Like if he was asking for 5K over MSRP on a Pontiac Aztec and decided to "hold out" as you say until someone walked in and paid it. Not a very good decision. Now...a dealer turning down a particular deal might be a mistake and might not, but over a period of time the price eventually finds it's equilibrium. If people are paying primium for STi's and then you walk in and refuse to pay the price the dealer will let you go. Mistake? you wouldn't know at that point. But if the next 5 that walk in are throwing their checkbooks at the dealer he probably made a good decision letting your deal go. BUT....if the next 5 walk in and are like you maybe the market is changing, he needs to lower his price and maybe you were just the beginning of a market shift. The laws of economics can be complicated but what we're talking about here is not......You pay the going rate or you don't, it all depends on what YOU'RE willing to pay, NOT what the dealer is TRYING to charge.
It's not the DEALER who sets the price, it's the MARKET that sets the price. The dealer is testing the waters, if nobody bites it's overpriced and they reduce the price until the car starts to sell. A dealer only ASKS a certain price, they don't hold a gun to somebody's head to buy at an inflated price.
I'm not a rep anymore I left the industry about 3 years ago.
But from my experience (and this can vary from one manufacturer to another depending on how their franchise agreements are worded and different state laws) the manufacturer NEVER tells a dealer what to sell the car for. Due to some laws that I don't remember the detail on it can constitute price fixing.
Your example of your Dad waiting 10 years is interesting. You say you would hold out for the 200K. Then why shouldn't a dealer hold out for a premium or MSRP or whatever HE THINKS the price SHOULD be? I think you're exhibiting a double standard here. Your Dad waiting 10 years is his prerogative as it is the dealers. OR he could take the price that is being offered such as the dealer could. There could be tradeoffs though. What if you're dad listed your house for 200K, someone offers you 175 and he turns it down. Then the market drops out and it's only worth 150? OR he's waiting 10 years for a small difference in price and during that whole time he's missing out on unloading his house and possibly buying a new and better one. If a dealer was that stubborn he would be out of business fast. Like if he was asking for 5K over MSRP on a Pontiac Aztec and decided to "hold out" as you say until someone walked in and paid it. Not a very good decision. Now...a dealer turning down a particular deal might be a mistake and might not, but over a period of time the price eventually finds it's equilibrium. If people are paying primium for STi's and then you walk in and refuse to pay the price the dealer will let you go. Mistake? you wouldn't know at that point. But if the next 5 that walk in are throwing their checkbooks at the dealer he probably made a good decision letting your deal go. BUT....if the next 5 walk in and are like you maybe the market is changing, he needs to lower his price and maybe you were just the beginning of a market shift. The laws of economics can be complicated but what we're talking about here is not......You pay the going rate or you don't, it all depends on what YOU'RE willing to pay, NOT what the dealer is TRYING to charge.
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Lance,
Point taken. Thanks for the explanation. As you can see, economics was NOT my major in college..
But, I still hold firm to the principles of the whole thing. The point of having a relatively inexpensive pocket rocket is totally dissolved when 20k markups are done to a 32k car.
I guess if people want it bad enough, they'll buy it..
Tim
Point taken. Thanks for the explanation. As you can see, economics was NOT my major in college..
But, I still hold firm to the principles of the whole thing. The point of having a relatively inexpensive pocket rocket is totally dissolved when 20k markups are done to a 32k car.
I guess if people want it bad enough, they'll buy it..
Tim
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"To be honest, if you're not already high-up on a waiting list already, I think it's highly unlikely you'll get one in '03 anyway without paying huge mark-ups."
I don't agree with the above statement. There will be plenty of STIs to go around for everybody at reasonable prices.
Sure, some dealers will go for the suckers and mark it up over MSRP, but that kind of silliness only lasts for about a month. After that most STI buyers will be able to get the car they want at MSRP or less.
Don't believe all the "sky is going to fall" talk in these forums.
The same kinda panic was running on this thread when the WRX came out 2 years ago:
"They're only making 2000 wagons!!!"
"They are only making 300 yellow!!!"
"Only 1 dealership in North Carolina is getting an 'alottment'!!!"
"They're only making 800 automatics!!!"
"EVO Magazine is predicting all WRXs for USA will be completely sold out by August!!!!"
The list goes on and on and on. Of course the dealers did all they could to perpetrate the madness. But about a month after the release, it started becoming obvious to everyone, (including the dealers), that there were plenty of WRXs and the car was trading closer to invoice than MSRP.
I don't agree with the above statement. There will be plenty of STIs to go around for everybody at reasonable prices.
Sure, some dealers will go for the suckers and mark it up over MSRP, but that kind of silliness only lasts for about a month. After that most STI buyers will be able to get the car they want at MSRP or less.
Don't believe all the "sky is going to fall" talk in these forums.
The same kinda panic was running on this thread when the WRX came out 2 years ago:
"They're only making 2000 wagons!!!"
"They are only making 300 yellow!!!"
"Only 1 dealership in North Carolina is getting an 'alottment'!!!"
"They're only making 800 automatics!!!"
"EVO Magazine is predicting all WRXs for USA will be completely sold out by August!!!!"
The list goes on and on and on. Of course the dealers did all they could to perpetrate the madness. But about a month after the release, it started becoming obvious to everyone, (including the dealers), that there were plenty of WRXs and the car was trading closer to invoice than MSRP.
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Well you are definately entitled to your opinion. In fact you might be surprised to find out that I am as much of a bargain hunter as you....who knows maybe even more so....
But if I'm the only one out there who isn't willing to pay the going market for a car or any other product for that matter I shouldn't be criticizing or attacking the dealers because it really isn't their fault.
Having someone ask for such a high percentage of a car's MSRP as a markup seems crazy. The only thing crazier is having someone ACTUALLY PAY the premiums that these guy's ask. That's what really kills me!
Ever since the internet boom I have heard so many stories of people paying these crazy prices and always wondered who the heck these people are?! I thought....Can they really be that stupid to pay that much premium on a depreciating asset? But hey to each his own. They really ruin the market for us enthusiasts who want a good deal. But my advice on buying cars is this......There is ALWAYS.....ALWAYS a good deal around the corner if you're patient. But letting the time go by until you find the deal is the tradeoff.
You may already be aware of this but there is a dealer in upstate N.Y. called Van Bortel Subaru who is promising to sell STi's at $400 over INVOICE. I'm on the list at like number 60 so I'm sure it's a longshot but you might give that a try. They didn't require any money for the deposit so I'm sure a lot of people will drop off. And then of the remaining people you might be able to take someone's spot on the list and get yourself a car!
GOOD LUCK!
But if I'm the only one out there who isn't willing to pay the going market for a car or any other product for that matter I shouldn't be criticizing or attacking the dealers because it really isn't their fault.
Having someone ask for such a high percentage of a car's MSRP as a markup seems crazy. The only thing crazier is having someone ACTUALLY PAY the premiums that these guy's ask. That's what really kills me!
Ever since the internet boom I have heard so many stories of people paying these crazy prices and always wondered who the heck these people are?! I thought....Can they really be that stupid to pay that much premium on a depreciating asset? But hey to each his own. They really ruin the market for us enthusiasts who want a good deal. But my advice on buying cars is this......There is ALWAYS.....ALWAYS a good deal around the corner if you're patient. But letting the time go by until you find the deal is the tradeoff.
You may already be aware of this but there is a dealer in upstate N.Y. called Van Bortel Subaru who is promising to sell STi's at $400 over INVOICE. I'm on the list at like number 60 so I'm sure it's a longshot but you might give that a try. They didn't require any money for the deposit so I'm sure a lot of people will drop off. And then of the remaining people you might be able to take someone's spot on the list and get yourself a car!
GOOD LUCK!
Guest
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I agree with what you are saying about price and demand. If they are able to get over MSRP, God bless... I would too. I just find it hard to compair buying a car to buying a house. A house will go up in value, so people are willing to embark in bidding wars. a car on the other hand, (and it is only a car) will lose value with in the first day. Even if you pick up the car from the dealer, put it on a flat bed, and put it in your garadge. you still loose.
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Rudy you are definately right about the comparison. But the fact that a car depreciates so drastically only makes it even more unbelievable that people are willing to pay high prices!
I thought the house comparison was the easiest way to illustrate supply and demand and how markets change and react.
Whipsaw you hit the nail on the head. All the excitement will die down and there will be plenty of cars at decent prices to go around. Some dealers think the cars are bricks of gold when they first come out. I wish most customers were like you and I and didn't pay the ridiculous prices out of the gate and save us all the hardship of having to wait for prices to come down which is ALWAYS inevatible.
I thought the house comparison was the easiest way to illustrate supply and demand and how markets change and react.
Whipsaw you hit the nail on the head. All the excitement will die down and there will be plenty of cars at decent prices to go around. Some dealers think the cars are bricks of gold when they first come out. I wish most customers were like you and I and didn't pay the ridiculous prices out of the gate and save us all the hardship of having to wait for prices to come down which is ALWAYS inevatible.
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Yes........if you wait long enough, MOST dealers will eventually be offering them at MSRP, or less and, in fact, some (many ?) dealers are selling them at MSRP from the get-go. But the fact remains that for '03 at least there will be a very limited number of STis available in the US and many dealers will be trying to make a killing.....it is not limited production, but it is definitely low-volume production, a different scenario from the WRX.
Personally, I am willing to wait until this time next year, but many people are not and think that they can just walk into any dealer and get one at MSRP straight after the launch......to do this you might have to shop around a lot and buy out-of-state, IF you're not already high a waiting list witha guaranteed price in writing.
Van Bortel are one of the biggest Subaru dealers in the US and their allocation for the whole of 2003 is 10 STis.......
Personally, I am willing to wait until this time next year, but many people are not and think that they can just walk into any dealer and get one at MSRP straight after the launch......to do this you might have to shop around a lot and buy out-of-state, IF you're not already high a waiting list witha guaranteed price in writing.
Van Bortel are one of the biggest Subaru dealers in the US and their allocation for the whole of 2003 is 10 STis.......
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LanceK
Its good to see someone who uderstands Supply and Demand, I personaly am bugged by people who just don't seem to get it. If a Dealer can sell a car for more than MSRP then that dealer should, and why because that's how you make money and that is what a Dealership is there for....to make money. If you pay more than MSRP or pay less than MSRP the only person you have to thank is yourself. No matter how much you want to believe so no dealership is Moraly obligated to sell at MSRP. Thats like the dealer saying your stealing from them for not paying MSRP.
Here is an Example that may work for more people.....
About a year ago It was time for me to look for a new job. I came up with a "Suggested Income(SI)" if you will that I felt would fairly compensate me for what I had to offer as well as help me meet my financial needs. Subaru basicly does the same thing with MSRP a price for the car based on what it offers and covering the cost to make it" Now after some interviewing and such the company I now work for offered me quite a bit more than my "SI" to work for them. Do you think I said "actually I was only looking for this number" HELL NO I didn't and neither would anyone else, you'd be a fool. Granted I didn't have an "SI" sticker on my jacket but its real simple for a company to get an average income for my qualifications and the position I was looking for. Its just palin buisiness, no economics degree required.
Its good to see someone who uderstands Supply and Demand, I personaly am bugged by people who just don't seem to get it. If a Dealer can sell a car for more than MSRP then that dealer should, and why because that's how you make money and that is what a Dealership is there for....to make money. If you pay more than MSRP or pay less than MSRP the only person you have to thank is yourself. No matter how much you want to believe so no dealership is Moraly obligated to sell at MSRP. Thats like the dealer saying your stealing from them for not paying MSRP.
Here is an Example that may work for more people.....
About a year ago It was time for me to look for a new job. I came up with a "Suggested Income(SI)" if you will that I felt would fairly compensate me for what I had to offer as well as help me meet my financial needs. Subaru basicly does the same thing with MSRP a price for the car based on what it offers and covering the cost to make it" Now after some interviewing and such the company I now work for offered me quite a bit more than my "SI" to work for them. Do you think I said "actually I was only looking for this number" HELL NO I didn't and neither would anyone else, you'd be a fool. Granted I didn't have an "SI" sticker on my jacket but its real simple for a company to get an average income for my qualifications and the position I was looking for. Its just palin buisiness, no economics degree required.
Guest
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Well I'm not sure what else to say to help you understand but here goes:
20K, 2K, 40K! The amount someone wants to pay for a particular product varies for everybody it's what is acceptable for THAT person that drives them to buy at that price. The market will usually dictate a price that MOST people want to pay and will adjust accordingly.
Why do some people pay hundreds or even thousands of dollars for a baseball card? The paper it's printed on isn't worth anything! It's because that person deems that price acceptable for WHATEVER reason.
Here's another: I was looking to buy a particular Rolex a few years ago. The MSRP was about 4K and that's what the dealer was charging. Now the price is 10K and that's only if you can get it. Now this watch is all stainless steel. You can buy a stainless/gold one for less money. The stainless is selling for more because PEOPLE ARE WILLING TO PAY. Not because DEALERS ARE DIRTY OR GREEDY. THE MARKET for that particular watch is 10K. If I want the watch I pay the "GOING RATE". Now the dealers WERE happy with MSRP but obviously the CUSTOMER is happy to pay much more. Who's fault is that? Nobody's really...it's just the market adjusting accordingly.
Now what if Rolex raised the MSRP to 10K? Would they be at fault? Maybe they priced the watch too low initially and need raise the price?
AGAIN I'm not defending dealers per say as I don't think many (not all) deal fairly, but after seeing how many people have such a one sided view of things I am starting to feel sorry for them!.....
20K, 2K, 40K! The amount someone wants to pay for a particular product varies for everybody it's what is acceptable for THAT person that drives them to buy at that price. The market will usually dictate a price that MOST people want to pay and will adjust accordingly.
Why do some people pay hundreds or even thousands of dollars for a baseball card? The paper it's printed on isn't worth anything! It's because that person deems that price acceptable for WHATEVER reason.
Here's another: I was looking to buy a particular Rolex a few years ago. The MSRP was about 4K and that's what the dealer was charging. Now the price is 10K and that's only if you can get it. Now this watch is all stainless steel. You can buy a stainless/gold one for less money. The stainless is selling for more because PEOPLE ARE WILLING TO PAY. Not because DEALERS ARE DIRTY OR GREEDY. THE MARKET for that particular watch is 10K. If I want the watch I pay the "GOING RATE". Now the dealers WERE happy with MSRP but obviously the CUSTOMER is happy to pay much more. Who's fault is that? Nobody's really...it's just the market adjusting accordingly.
Now what if Rolex raised the MSRP to 10K? Would they be at fault? Maybe they priced the watch too low initially and need raise the price?
AGAIN I'm not defending dealers per say as I don't think many (not all) deal fairly, but after seeing how many people have such a one sided view of things I am starting to feel sorry for them!.....
Guest
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I really think that it is less a matter of a small markup due to the market than moron dealers.
If you went in to buy that Rolex for fair market value, the dealer would realize that its a fair value and not laugh in your face.
Some of these dealers right now are doing just that. They know that their markups are unreasonable and they are laughing in our faces. I think that's what people are upset about. If I had to pay 1K over msrp to get my STI, I wouldn't like it, but I'd prolly do it if the deal honestly thought it was fair. If he's signing the papers and laughing, he obvioously thinks he's taking you for a ride. That is just not right.
If you went in to buy that Rolex for fair market value, the dealer would realize that its a fair value and not laugh in your face.
Some of these dealers right now are doing just that. They know that their markups are unreasonable and they are laughing in our faces. I think that's what people are upset about. If I had to pay 1K over msrp to get my STI, I wouldn't like it, but I'd prolly do it if the deal honestly thought it was fair. If he's signing the papers and laughing, he obvioously thinks he's taking you for a ride. That is just not right.
Guest
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good couple of posts... I'll bring it down a notch.
It's fine to complain about dealer mark up, but what does this mean to you. Are you really that pissed about it because you know you'll pay it, and you're just going to perpetuate dealer markups. My dealer has said that as soon as he gets one on the showroom floor there will be a substantial markup, but this won't be until the first 7 (currently) orders have been filled. I agree with him that he should mark it up, I'd do the same thing. He has also said that after the initial release that he will probably mark up all orders, but for the ones before he said it made sense not to upset this market group. If he decides not to stick to our agreement for MSRP and 2nd on the list then I'll complain. Only because of the breech in agreement. Every other time I've bought a car and the dealer won't sell it to me at the price I want/feel is fair (agreed to in a contract) I have walked away. So you don't get the car that day, if you can't wait and spend more than you want to because you HAVE to have one of the first ones on the block... don't gripe. It's your own damn fault for your own needs (of whatever type).
It's fine to complain about dealer mark up, but what does this mean to you. Are you really that pissed about it because you know you'll pay it, and you're just going to perpetuate dealer markups. My dealer has said that as soon as he gets one on the showroom floor there will be a substantial markup, but this won't be until the first 7 (currently) orders have been filled. I agree with him that he should mark it up, I'd do the same thing. He has also said that after the initial release that he will probably mark up all orders, but for the ones before he said it made sense not to upset this market group. If he decides not to stick to our agreement for MSRP and 2nd on the list then I'll complain. Only because of the breech in agreement. Every other time I've bought a car and the dealer won't sell it to me at the price I want/feel is fair (agreed to in a contract) I have walked away. So you don't get the car that day, if you can't wait and spend more than you want to because you HAVE to have one of the first ones on the block... don't gripe. It's your own damn fault for your own needs (of whatever type).