… about the corporation’s decision to sell Scout vehicles directly to buyers, thereby bypassing the dealer network.
Article, unless I missed it, did not say where these vehicles will be serviced and warranty work will be performed.
Personally, I think price and ease of purchase is only one aspect of buying a vehicle. Dealerships perform a number of tasks beyond taking your money and supplying the keys.
I remember back in the 60s you could buy a new Chrysler by going to Detroit and picking it up from the factory. Maybe you still can but few really did it unless you lived there. Maybe they’ll have trucks drop the car at your house or mobile mechanics for the service and repairs. If you go to a dealer for the work, I wonder where you’ll be on the priority list or will the dealer just say we don’t work on those here?
Other than possible factory delivery (according to a post on Scout’s own forum) It sounded more like mobile service and regional physical service centers. Instead of selling through your local VW dealer. Tesla’s centers are more common than Rivian or Lucid in Western Washington.
Spose they’ll have one in mason city Iowa or will they have to drive a hundred miles?
It’s 67mi to Rivian’s service center from here, Seattle area will get locations long before we do, Tesla just opened near Tacoma a couple years ago. Rivain has 2 centers in the Portland Oregon area but there must be a larger number of Rivian’s there to service. Tesla started out in Seattle and Bellevue before expanding out when the Model3 was introduced.
Considering that Dealships make practically nothing on new car sales, maybe a couple hundred, you’ve got to wonder what’s the benefit to the consumer?
Is VW going to pay me the Buyer to clean up the car, remove the miles of eaterior/interior shrink wrap, attach the “dealer attachments” and check all the levels?
Even worse, if my new VW arrives with transport stains and scratches is VW going to take complete care of the repairs?
And if I don’t like the size, color, etc. when it’s delivered can I “return it free in the original packaging”?
This sounds like a completely idiotic idea from the Amazon Generation.
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The article says that the dealer is not involved with selling Tesla’s new cars and that isn’t true. There are salespeople at the showrooms and they are on salary. There are no commissions. I talked to a salesman for a test drive and later contacted him to buy a car that was to be built in the next week or two. He got the ball rolling. When it came time to pick the car up, he was helping other customers and one of his colleagues finished the paperwork with me. No commission, no problem.
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They might not be on commission or anything, but you can bet they still have a minimum quota either in car sales total count and or a dollar total amount of some kind… Another words, he just can’t sit around looking pretty and keep his job… lol
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Local stores don’t advertise, that’s all through HQ. I saw two salespeople when I picked my car up and they were very busy. There are also very few dealerships, one in the Baltimore area and three in the DC area. That’s not many for a population of about 10 million.
You make great points about the issues a consumer may have and how they would resolve them.
Don’t forget about dealer holdback (2% for VW I believe) and finance reserve (1-2% interest rate markup) that will now go to VW and not to a dealer. On a $55K scout with $50K financed for 60 months (2% markup) and a sales price profit of $500, that’s over $4K in profit going directly to VW that otherwise would have gone to the dealer. Of course, they won’t pass the retail markup and holdback savings to the consumer. This is sold as a smooth and transparent transaction for the consumer when what it really is, is a shifting of profit from the dealer to VW.
We’ve been holding off on buying wife a new car to replace her 07 lexus because of the Dealer markups. We looked last year and dealers around here were selling $2000-$3000 OVER MSRP. That’s all profit for the dealer. It’s still going on for certain models.
In view of VW’s escalating fiscal problems, this isn’t very surprising–IMO:
https://www.reuters.com/business/autos-transportation/volkswagen-plans-major-layoffs-shut-least-three-german-plants-works-council-head-2024-10-28/
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It seems that the Scout should be sold at VW dealers with a set price and no added options. If after seeing the Scout and deciding to not buy one they might look around and actually buy another VW product.
It would not be hard to send a repair crew to a dealer for Scout problems . Might be less expensive then leasing or building one vehicle sites just for Scouts.
That’s an excellent point as a way to generate manufacturer profitability.
My wife’s first new car was a Honda Civic CVCC which all came from the factory fully equiped with all the desireable options and basically sold at a set price. No more haggling about an optional radio, A/C, rear window defroster, etc. that tended to jack up the price.
The benefits to offering only one Trim Level and “doing it all to all the cars at the factory” was an increase in quality, a decrease in the cost and an increase in buyer satisfaction and established Honda’s reputation.
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Set price? Really? We’ve owned a few Honda’s over the years and always been able to haggle on price.
What the Japanese did and now ALL manufacturers do is bundling. Some options like Rear Window Defroster are MANDATED by feds. Back in the 80’s - you could order each option separately from GM, where as the Japanese vehicles would bundle options into trim levels. Sometimes it wasn’t that advantageous. My 1990 Pathfinder was a Manual tranny. If I wanted intermittent wipers factory installed I had to buy an automatic. Still can’t figure out why those would be bundled together. Luckily there was a Nissan install kit to add intermittent wipers.
I’ve always been able to haggle on price - until Covid. Seems like things may be back to normal so this winter we’ll be looking for a new car for my wife.
Are you saying all Civics with the CVCC engine were sold with AC . . . ?
Since Honda A/C was dealer-installed back in those days, it’s very doubtful that A/C was standard equipment.
Depends on the car and market conditions. The CVCC system allowed Honda to use carburetors instead of fuel injection. Since FI was new in the 1970s, the CVCC would save manufacturing costs. Also, emissions were low enough that a catalytic converter wasn’t needed either, even in California. See references in Wikipedia for CVCC and first generation Civic for more information. Those two cost savings would allow Honda to set a price lower than the competition and no price breaks were necessary to get a lot of sales.
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VW dealers aren’t the only ones who are not happy.
Just do a search for “vw closing plants in germany”.