GT-R dealer markups

[SVT666]

Dealer markups to push GT-R pricing as high as $129,000
January31


Although the Nissan GT-R will sticker for about $69,000 when it goes on sale in the U.S. later this year, prospective buyers will be hard pressed to find any Nissan dealers to offer the supercar at that price. The combination of the GT-R's limited availability and Nissan's lack of dealer pricing control could see some of the turbocharged coupes going for as high as $129,000 ? nearly double the car's MSRP.

Exhaustnote.com called on 15 Nissan dealers through the United States and found that the GT-R will command at least $20,000 over its window sticker. Several dealers even said they were going to handle GT-R sales like an auction, pitting prospective buyers against one another.

One dealership in Carson, California said they would markup the GT-R by about $50,000 ? joking the markup would be about the same as a new Nissan 350Z and Sentra.

The highest markup found was $60,000, bringing the GT-R's out-the-door price to a staggering $129,000.

The huge markups are due to extremely limited availability of Nissan's latest supercar ? only 1,500 GT-Rs will be available in the U.S. this year. Most dealerships will only get 2 or 3 cars, but most have waiting lists at least 40 people deep.

While Nissan has counseled its dealers on markups ? one of the GT-R's greatest assets was supposed to be amazing performance at a value price ? the Japanese automaker has no control over how much dealers will actually charge.

[Tave]

Nissan should try to flood the market.

[the Teuton]

This, and exactly this, is why my tuner friend was waiting for this car to come out before he was seriously considering buying an R33 or R34 GT-R.  The new car just lowered their values significantly.

[ifcar]

"While Nissan has counseled its dealers on markups ? one of the GT-R's greatest assets was supposed to be amazing performance at a value price ? the Japanese automaker has no control over how much dealers will actually charge."

Sure they do. They control the allocation. Maybe they can't prevent a markup from happening, but they certainly don't have to send that dealer as many GT-Rs. Hell, they could cut back on the number of Altimas or Muranos they send too, for good measure.

[GoCougs]

"While Nissan has counseled its dealers on markups — one of the GT-R's greatest assets was supposed to be amazing performance at a value price — the Japanese automaker has no control over how much dealers will actually charge."

Sure they do. They control the allocation. Maybe they can't prevent a markup from happening, but they certainly don't have to send that dealer as many GT-Rs. Hell, they could cut back on the number of Altimas or Muranos they send too, for good measure.

In theory, the automakers must have in place an objective measure deciding allocation (sales, # of sales people, # of service bays, etc.), to comply with various US anti-trust laws, which are intended to prevent manufaturers from controlling transaction price by such backdoor means as you suggest.

I made the statement last time that it shouldn't be Nissan's business what the cars sell for, and IIRC people really didn't like that sentiment from some reason.

[the Teuton]

I have never seen a Z06 go for more than $78,000.  This overpricing might scare a lot of people over GM's way.

[280Z Turbo]

The dealer pockets all of that money for doing nothing.

[BimmerM3]

That sucks... is there really nothing that Nissan can do to control the dealers?

[ifcar]

In theory, the automakers must have in place an objective measure deciding allocation (sales, # of sales people, # of service bays, etc.), to comply with various US anti-trust laws, which are intended to prevent manufaturers from controlling transaction price by such backdoor means as you suggest.

I made the statement last time that it shouldn't be Nissan's business what the cars sell for, and IIRC people really didn't like that sentiment from some reason.

An objective measure of each model, or total number of cars shipped? I also highly doubt, for example, that anti-trust laws would prevent Nissan from sending cars that don't sell well, like with manual transmissions or hideous colors.

And Nissan certainly has a responsibility to ensure that the products it paid to develop are being sold responsibly. Dealers consistently demonstrate a lack of long-term understanding that comes back to hurt the manufacturer.

[FordSVT]

I have never seen a Z06 go for more than $78,000. This overpricing might scare a lot of people over GM's way.

No possible way. There are so few cars available and enough people to buy them whether they are priced at $70,000 or $200,000. Neither the Corvette nor the GT-R will really lose a net sale to one another because neither vehicle will have any problem selling as many of them as they can build.

Really, the only impact this will have will be to eliminate the GT-R's value proposition vs cars like the 911T and the Z06 on paper. But since the only paper that matters is green, and Nissan will sell them all and their dealers will make a hefty profit, what does it matter?

[Lebowski]

That's absurd, why doesn't Nissan either make more or charge a higher MSRP?

It's a pretty damn good deal at $69k, but no way would I pay $100k+ for one. 

I would hope after a year or to you'll be able to get one for MSRP.

[SJ_GTI]

In theory, the automakers must have in place an objective measure deciding allocation (sales, # of sales people, # of service bays, etc.), to comply with various US anti-trust laws, which are intended to prevent manufaturers from controlling transaction price by such backdoor means as you suggest.

I made the statement last time that it shouldn't be Nissan's business what the cars sell for, and IIRC people really didn't like that sentiment from some reason.

Absolutely disagree. Nissan should be able to charge whatever it wants for the GTR, and if dealers don't want to use that price Nissan should get to say "NO GTR  FOR YOU!" Nissan is in the business for the long term, most of these dealers can't see beyond the next months sales and profit figures.

Its interesting you mention that Nissan would somehow be breaking anti-trust laws, which is patently false. Anti-trust is not about forcing manufacturers to comply with dealers with no recourse. Nissan should be able to set up their own retail outlets IMHO, but is stopped from doing so by franchise laws (which are anti-anti-trust IMHO).

The reason Nissan has to use backdoor workaround for these dealers is simply because Nissan isn't allowed to sell its own products. In a free market, Nissan's solution to mismanaged dealers would be simple: Set up its own retail outlets (like any othr business can do).

[Lebowski]

Absolutely disagree. Nissan should be able to charge whatever it wants for the GTR, and if dealers don't want to use that price Nissan should get to say "NO GTR  FOR YOU!" Nissan is in the business for the long term, most of these dealers can't see beyond the next months sales and profit figures.

Its interesting you mention that Nissan would somehow be breaking anti-trust laws, which is patently false. Anti-trust is not about forcing manufacturers to comply with dealers with no recourse. Nissan should be able to set up their own retail outlets IMHO, but is stopped from doing so by franchise laws (which are anti-anti-trust IMHO).

The reason Nissan has to use backdoor workaround for these dealers is simply because Nissan isn't allowed to sell its own products. In a free market, Nissan's solution to mismanaged dealers would be simple: Set up its own retail outlets (like any othr business can do).

Hmmm, I'm no legal expert but I'm not sure if I agree with you.  It might not be anti-trust laws (may be somewhere else), but as far as I can tell manufacturers in general have no recourse when it comes to enforcing MSRPs.  That applies to everything as far as I know, from cars to video games. 

What I will say is, if the market values the car at $130k, Nissan should have priced it close to that level and captured as much of the margin for themselves, rather than let the dealers have it.  It makes no sense to limit production and not benefit from that via pricing, unless they expect prices to fall off dramatically after the first year.

[BimmerM3]

The reason Nissan has to use backdoor workaround for these dealers is simply because Nissan isn't allowed to sell its own products. In a free market, Nissan's solution to mismanaged dealers would be simple: Set up its own retail outlets (like any othr business can do).

Yeah, that pisses me off. Imagine how much cheaper cars would be if we could order online like you can a Dell.

[CALL_911]

Yeah, that pisses me off. Imagine how much cheaper cars would be if we could order online like you can a Dell.

Yeah, and wouldn't Nissan get more profit too? Why don't they do that?

[BimmerM3]

Hmmm, I'm no legal expert but I'm not sure if I agree with you.  It might not be anti-trust laws (may be somewhere else), but as far as I can tell manufacturers in general have no recourse when it comes to enforcing MSRPs.  That applies to everything as far as I know, from cars to video games. 

Right, but in the case of most consumer goods, such as electronics lets say, no retailer would ever chose to charge OVER MSRP because if they did then you could go straight to the manufacturer's outlet to buy the same product at MSRP.

There are exceptions such as Playstation 3 where rarity will still drive the prices up, but Nissan can take measures against that, such as voiding the warranty if not sold by an authorized dealer.

[BimmerM3]

Yeah, and wouldn't Nissan get more profit too? Why don't they do that?

There are laws against it. A car manufacturer cannot sell directly to the consumer.

[Lebowski]

but Nissan can take measures against that, such as voiding the warranty if not sold by an authorized dealer.

that probably wouldn't be a very smart thing to do from a marketing/PR perspective.

[SJ_GTI]

Hmmm, I'm no legal expert but I'm not sure if I agree with you.  It might not be anti-trust laws (may be somewhere else), but as far as I can tell manufacturers in general have no recourse when it comes to enforcing MSRPs.  That applies to everything as far as I know, from cars to video games. 

What I will say is, if the market values the car at $130k, Nissan should have priced it close to that level and captured as much of the margin for themselves, rather than let the dealers have it.  It makes no sense to limit production and not benefit from that via pricing, unless they expect prices to fall off dramatically after the first year.

I understand its illegal, but my point was that those laws are actually anti-competition, where s the point of anti-trust laws is to encourage competition. Franchise laws are horrible for manufacturers, who are absorbing the vast majority of risk in selling cars.

[Cookie Monster]

Stealerships are lame.

[Raza]

That's fucking ridiculous.  Don't people realize that as soon as they buy that car, they lose $70,000, more than the price of the car, for a fucking Nissan? 

I've never seen a Porsche with a markup.  GT3 sounds like a bargain compared to the GT-R.

[CALL_911]

That's fucking ridiculous.  Don't people realize that as soon as they buy that car, they lose $70,000, more than the price of the car, for a fucking Nissan? 

I've never seen a Porsche with a markup.  GT3 sounds like a bargain compared to the GT-R.

Ever hear of the GT3 RS?

[Raza]

Ever hear of the GT3 RS?

Yeah.  I saw one at a dealer and it was not marked up.

[the Teuton]

The R34 sold for about $70,000 new in Europe and about $90,000 through Motorex before they were shut down.  That seems to suggest to me that higher prices can be met for a car like this even though they sold for somewhere around $50,000 in Japan.

[CALL_911]

Yeah.  I saw one at a dealer and it was not marked up.

That's the first one I've heard of that's not marked up. Guys, honestly, who didn't expect this?

[the Teuton]

That's the first one I've heard of that's not marked up. Guys, honestly, who didn't expect this?

Porsche rarely marks up their cars, and often they discount them fairly well.  It's Ferrari that charges a premium for the price of admission.

[CALL_911]

Porsche rarely marks up their cars, and often they discount them fairly well.  It's Ferrari that charges a premium for the price of admission.

For the majority of their cars, that's very true. However, how do you explain the majority of the prices of the cars on this page?
http://motors.shop.ebay.com/Cars-Trucks___Porsche-911-GT3-RS_W0QQMake247a0eZPorsche4bd8b000QQ_nkwZPorscheQ20911Q20GT3Q20RSQQ_catZ6001QQ_fxdZ1QQ_ipgZ50QQ_pcatsZ6000QQ_sopZ1

[the Teuton]

The highest prices were in Florida, California, and Texas.  Where do you think most Porsches are purchased?

[CALL_911]

The highest prices were in Florida, California, and Texas.  Where do you think most Porsches are purchased?

Okay, but it was a markup, nonetheless.

[GoCougs]

An objective measure of each model, or total number of cars shipped? I also highly doubt, for example, that anti-trust laws would prevent Nissan from sending cars that don't sell well, like with manual transmissions or hideous colors.

And Nissan certainly has a responsibility to ensure that the products it paid to develop are being sold responsibly. Dealers consistently demonstrate a lack of long-term understanding that comes back to hurt the manufacturer.

I was thinking in general terms - it's probably a concoction of many different mearsurable factors. Again, the manufacturer can't allocate as you suggest on a whim. The system has (supposed) to be objective.

I don't see who charging above MSRP is irresponsible. If people are willing to pay it, IMO it's quite responsible - everyone benefits.