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[–] 82 points 7 months ago (7 children)

Such a weird, American-only practice, like with American health insurance. The whole country is a scam, jeez.

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  • [–] 3 points 7 months ago* (last edited 7 months ago) (5 children)

    Um, only having been tourist to the US, how does it work?

    Edit: the car dealership. What's different to e.g. Europe (the referenced American only practice)

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  • [–] 2 points 7 months ago (3 children)
  • [–] 2 points 7 months ago (2 children)

    The first comment talks about stealership, the next about weird us practice and I have no idea what they are referring to 😁.

    In Europe we habe car dealers, franchise, independent or do buy privately but they can all act independently.

    Is there a cartel or something in the US for car dealerships?

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  • [–] 5 points 7 months ago (1 child)

    In most states, manufacturers are prohibited from selling directly to consumers.

    There are a variety of reasons for it, some were consumer-friendly (like preventing the manufactures from monopolizing repair/service), but it basically created a system of middlemen that raised costs.

    I worked at a Honda dealership in college and I learned a lot.

    For example, when you finance through a dealership, the dealer doesn't actually put up any money. They find a 3rd party financer then tack on a few percentage points.

    Salespersons also earn higher commissions on dealer-provided upsales, such as window-etching, rust-preventative, custom badging, extended warranties, etc, so they try to push those things.

    Dealers are also locked into individual manufacturers, usually. That is, a "family" of dealerships, are actually multiple businesses, each with a contract with a different manufacturer.

    The person that owned the Honda dealership I worked at, owned others. On one side, they had a Pontiac-Buick-GMC dealer, then Chevy, Chevy truck, and Cadillac on the other side. Even they it was all General Motors, they were run separately. Down the street, they had a dealership that sold both new Toyotas and Subarus.

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