you are viewing a single comment's thread
view the rest of the comments
[–] 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.

  • source
  • parent
  • hideshow 1 child comment