LESS THAN ZERO.

By Peter M. DeLorenzo

Detroit. Now that we are firmly entrenched in this era of “everyone has ‘rights’ but no one wants the responsibility that comes with them,” it’s no wonder that where we go from here is fraught with peril. In fact, the tone and tenor of our society at large has been a burgeoning nightmare for years, and it continues to negatively reverberate through every aspect of our life as we know it. The chatter hanging in the air and permeating social media is all about “what we deserve,” “what we’re owed,” and oh, by the way, “you suck.” Reasoned, intelligent discourse is for the history books, a quaint notion from a bygone era that’s as obsolete as pay phones. And hand-wringing about it seems to be a fool’s errand as well, because no one cares and everyone wants “what’s mine.”

The car business isn’t immune to these societal winds either. Right now, this industry is in the throes of an unprecedented crisis. Ravaged by COVID for two years, and now decimated by the ongoing chip fiasco, this business has been turned upside down. New inventory “on the ground” is pretty much nonexistent. Now, it’s all about getting your order in, or, if a vehicle coming off of a delivery truck isn’t sold, you will pay what the dealer wants or there are five other people lined up behind you who will. Added to this chaos is the fact that used cars are such a hot commodity right now that dealers are turning vehicles with what used to be referred to as “demonstrator” miles into high-priced units that in some cases are going for even more than their new counterparts. 

It’s just c-r-a-z-y.

The emails we have received over the past week are laden with such extreme vitriol directed at dealers that I can’t recall another time over the 23 years of creating this website that even comes close to it. Just when you might think that the “good” dealers – you know, the ones who actually give a shit and go out of their way to take care of their customers – are getting out from under the black cloud created by the “bad” dealers after decades of blatant consumer abuse, it’s abundantly clear to me that car buyers still hold the typical car dealer with such utter disdain that it’s as if the last 30 years of collective manufacturer hammering of their dealers to “do better” has amounted to a big, fat zero. 

Less than that, in fact.

The complaints are time-honored and freakishly similar to the bad old days. One of our readers – Max, from Long Beach, California – put it this way: “I have to disagree that the ‘no dicker sticker’ is here at all, let alone here to stay. Customers don’t know the price going into the transaction because even if they arrive at the dealership with an MSRP from the online configurator and no market adjustment, they’ll struggle to leave the dealership without also accepting door ding protection, nitrogen-filled tires, an aftermarket alarm, VIN etching, underbody coating, wheel and tire protection, gap insurance, key protection, interior fabric protection, a maintenance plan, extended warranty, etc. Don’t want it? Unfortunately, it’s ‘already installed’ and one of the three people in line behind you will take it. Unlike market adjustments, I haven’t found this to be a practice only carried out by a minority of dealers during this era of tight inventory. Getting a vehicle at MSRP without being forced to accept any add-ons is a bargain in today’s market.”

This Bush League Bullshit has been going on in the car business for so long that I can’t even remember when it wasn’t. But now? It’s ramped up to an entirely new level of blatant thievery. Today’s “market adjustments” are flat-out usurious; it’s unbridled malpractice designed to extort as much money from buyers who should admittedly know better. $5,000 over sticker for a middling SUV/crossover is just the start. How about that same middling SUV/crossover with 1,000 miles on it for the same “market adjustment”?

And that’s not even getting into the “hot” models of the moment and the “market adjustments” of $15,000, $20,000, $30,000 and up. Manufacturers are going after these offending dealers with tools like withholding inventory and even threats to yank the franchise. But it’s not really working, and besides, the offending dealers are staunch in their defense with rote, indignant responses like this: “We’re independent business people and we’ve had to put up with such crap over the last two years that it’s our prerogative to charge what the market will bear. Don’t worry about our customers; we know our local market and you don’t. And besides, if we piss off a few of these ‘first-on-the-block’ types who want to pay $30,000 over sticker for a Bronco, who cares? If they’re dumb enough to do it, we’re smart enough not to turn down the ca$h-ola. We don’t care if they come back or not.” Or something like that.

The manufacturers are understandably apoplectic about this. They spend collective billions on developing, crafting and honing their brand images. They orchestrate experiential marketing events at a million dollars a pop (at least); they drop $15 million all-in on a 90-second Super Bowl ad; they do all of this in the belief that they can convince and cajole consumers to believe that their BelchFire Super8s are superb in every way and that if they buy one it will make them more confident, sexier and hotter in every way.

And then those same suitably puffed up consumers all jacked up over the manufacturer “fluffing” go into a dealership stocked with bad actors, and all of that money spent on brand image evaporates in ten minutes. It’s such an old pathetic tale that after all these years you would think that we would have finally moved beyond this type of hucksterism and calculated gouging. But in fact, it’s more extreme, much more blatant and more upfront than ever before.

And the chance of these egregious tactics fading into the woodwork any time soon are, in fact, less than zero.

And that’s the High-Octane/Electron truth for this week.

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