Auto dealers vs RV dealers

[rapiniii]

Preface, I love my 3051s. I bought two new vehicles last fall, a FR 3051s and a Fiat 500 Sport. The difference between dealers couldn't be more stark. Fiat of Lakeside gets a 15 out of a 1-10 rating and the un named FR dealer get a -4 out of a 1-10 rating. Forest River gets a 9 because of Brian Clemens and Mike Jankowski. And this forum.

[tmhyer]

If the FR dealer is bad, name names to warn us!

[Lloydg]

Comparing RV dealers with car dealers is like comparing restaurants with grocery stores. It's too bad the RV industry isn't more like the car industry, but it is like it is. There are good ones and bad ones. Thank goodness I have a good one.

[bclemens]

One nice thing about a car dealer...they normally specialize in one brand. Fiat of Lakeside sells...well...Fiats. There may be other brands there, but not many and probably not in the same building using the same people.

Now imagine a single dealership that sells Fiat, Ford, Chevy, Dodge, Kia, Buick all under one roof and has the same techs service all those cars. It's partly the dealers fault and partly the industry. In trying to gain market share, mfgs create model after model. Dealerships lose one deal to the dealer down the street and they pick up a new brand to prevent that. Rinse, repeat.

As a company we are doing our best to consolidate brands and standardize features. There are some really good dealerships out there that do their best to focus on certain brands, train their people and provide backend support. Then there are other dealers that try to be everything to everybody but don't put in the time, training or effort to see it through.

[rapiniii]

Brian, I agree with your point, but I remember buying cars in the sixties, seventies and eighties. Really, really bad. The dealer are independent businesses with no control from the mfg., still the case now. What changed, competition. Dealer and mfg. had to step up their game. Are they 100%? No, evidenced by the huge amount of recalls this year. But now, buying or servicing a car isn't the stomach wrenching ordeal it was.
Again, I think Forest River is a step ahead of other companies.

[LittlePM]

I understand this way to well. In Feb. I bought my third RV from the same dealer, this passed week I took a friend to said dealer, they kidded me and asked if I was back to trade in again, I said no, but my friend is looking to buy a motor home, they said ok, we went and looked at what they had, no one came out to help us, we went inside and sat at the table for more then 30 minutes NO ONE came over to ask anything. I was put off by this, since I told them she was looking to buy.

[Herk7769]

What follows is an opinion piece...

Also not mentioned is the markups. Car dealers typically operate in the 15 - 20% margin area while RV dealers run in the 50% margin area.

I am sure there are REAL good reasons for this (just cause they can seems to be the only one I can find).

There are web sites for determining the "invoice" and MSRP for cars and trucks, and options!, (so you have "some" idea what a fair price is), but nothing like that for RVs.

You can be looking at identical RVs, similarly equipped, with completely different (BY THOUSANDS in some cases) MSRPs.

It is truly the WILD WEST out there when shopping for an RV.

Even "At Invoice" a car dealership is making a few thousand on the deal and many can sweeten that by adding high profit "adds" like your trade in and dealer financing.

At an RV dealership, without some basis for negotiation needs to be established. Without a watchdog like Edmunds.com for autos, you are really on your own to find a starting point.

I have found that you should never work down from the dealer's number; but UP from your basis point to find an equitable price. Making you fight your way down leaves all the cards in the dealer's hand.

If you look at the dealer's "MSRP" (a completely bogus number made up by the individual dealership since as far as I know FR does not establish one) and subtract 40% you should be at a reasonable starting point. Then make them justify any increase in price. You should be able to close about 30% off "MSRP." If not, find another dealer who WILL trade fair with you.

In the end, they will not sell to you if they lose money and you should not buy if you are paying more than you should.

[bclemens]

I'll take a shot at this one...(mainly opinion with a few facts thrown in)

Let's just look at the raw numbers for 2013
--15.6 million passenger vehicles sold
--312,000 RV's (motorhomes, trailers, 5th wheels, etc) shipped

Volume forgives a lot of sins. As a car dealer, you make a few mistakes on valuations, etc no big deal. An RV dealer has fewer chances to screw up and take a loss, there is more risk involved. Risk means more cost.

Margins: again, volume. The more you sell, the more precise your margin can be. The fewer you sell you need to cover overhead, pay your people you can't afford mistakes. On the wholesale side I can assure you that no dealer of mine is making a 50% margin. This is not the jewelry business.

MSRP: this is not a made up number by the dealer. We the mfg, set the MSRP, we ship an MSRP with every unit. You should feel free to call any mfg and request an MSRP price sheet. Now I can't police what they do with the MSRP once they get it...but you can always get MSRP pricing. (Look at what auto dealers do with their black magic marker on high demand units)

Invoice: Auto mfg's have hold backs (RV's do not). So they have a built in profit margin. Even at invoice...yes, they get that money + trade (that has a HUGE pool of data to determine value). RV's don't have the same pool of data to work with (being smaller numbers) so used values can vary drastically percentage wise over what autos will.

("Opinion only" from here on out)
I do not argue with your negotiating theory, but remember the same thing when valuing your trade. The next customer will try and buy it at book value which means the dealer is fighting from that line to make any money. It may be a floor plan that only 500 were made...how do you establish a true value on that?

What I see from many customers is they want to get the new unit at what they think is invoice and they want full retail value on their trade.

Do I think dealers start high with their pricing?...some do, but they're simply preparing for the customer to want a high price on their trade.

I agree that something like Edmunds would be nice for RV's and maybe we'll get to that...but in the end we're dealing with a much smaller pool of numbers. An auto dealer will take a a nothing deal knowing they can get another one tomorrow. If an RV dealer (I can only speak for motorized) sells a unit they may be 12 weeks to get another one. Season is gone.

Obviously the auto industry is the easiest comparison...but I don't think it is the most fair comparison. I think you should compare the RV industry with the boat/auto/housing/modular housing industry because in the end...it really is a mixture of them all.

[RvBill3]

One of the hidden problems with an MSRP that is way above actual purchase price is what happens when you try to get insurance. When I purchased my Sunseeker, it was $35,000 below the MSRP (RvDirect.com). My insurance company insisted on using MSRP to value the MH and insured it for that. I sent them the Bill of Sale and they still wouldn't change that. Obviously the premiums were high. I started shopping around and found a company that understood RVs and would insure for a price that they and I agreed upon (the actual sale price). Saved half on premiums. This problem is related to the overly high MSRP and the lack of a good valuing system like Edmunds.

Before someone asks...the new company is Progressive. The old one is one that has a lot of "A"s in their name and is associated with an auto club of the same name.


2012 Forest River Sunseeker 2300 Chevy

[Herk7769]

Brian, you make excellent points and I really have no issue with the dealer making a killing "on the next guy." I will never trade in another vehicle for the reason you state.

I know I can look the buyer in the eye and tell him or her that nothing is wrong or exactly what is wrong and we can arrive at a fair price where we are both happy. Getting what the dealer offered on the trade plus the sales tax savings is a REAL good deal for the buyer and you can still negotiate a "cash" price with the RV dealer.

Negotiating your tail off to get a good deal on the new unit and then get hosed on the trade and/or loan terms makes little sense to me.

Do you really want to buy your RV from a dealer who only sells a couple of units a year? Just sayin'

[rapiniii]

And we haven't got to the service department yet.

[rapiniii]

Probably should let this topic die. I'm just getting old and cranky and had to rant.

[schrederman]

Car dealers... AAAAHHHHHHHHH!!!!!!!!!!!! Run!!!!!! Seriously, to me a dealer is a dealer... regardless of what he/she is selling. I'm looking for a new TV, now specifically a Ram 2500. My '11 F-150 has been electronically appraised and I've received a congratulatory (really??) message saying it's worth $15,500- from Auto Trader. The dealer wants to go by that... No thanks. NADA and Kelly both say it is worth right at $4,500- more but the dealer isn't going anywhere with that. Now, in my area, I looked at '11 F-150s and the cheapest was like mine, but with 89K miles and body damage, and the asking price was $24,900-... Seriously? I can't wait until I try to trade up with my RV...

Car dealers, boat dealers, rv dealers, etc......... Sheesh!!

[prof_fate]

The internet has change car sales..A LOT.
I worked in car and bike/boat industry in the late 80s-2002ish. I sold cars, was a tech and service writer, did parts for 5 years too.

Till last year always bought cars in person, helped many friends buy cars too. Wow, how the internet has changed EVERYTHING. I'll never (ok, never say never) buy a car 'in person' again.

Shopped on a chevy truck, in person. Sticker was $41k ish on what we wanted. Dealers, in person, wanted $37kish. Figured I'd look on the net to find a deal with what I wanted (equip wise) and ended up with MORE equipment for a price of $32,500 out the door, tax and all, within an hour of my first 'click'. And they'd take my trade value off that price.

Bought a subaru used 3 years ago..internet lists by price..so at the dealer he KNEW he had the lowest priced outback in 150 mile radius. No negotiating on price. PERIOD. None. At. All.

Bought a new subaru, same dealer. Got a decent price for my trade ($500 less than ideal..but he was willing to stroke a check for the figure). He quoted my '$750 below invoice, here look!'...again, hello internet. A dealer across town had the same car and I was quoted $350 less yet, in writing - he matched that.

So 'invoice' is definitely a fluid figure just as MSRP is. At least cars have window stickers.

And yes, volume allows a dealer all sorts of benefits and RV's aren't going to move off the lot like cars.

And car dealers make money in their service dept..do RV dealers even bother to try? My RV dealer never contacted me again..the subaru dealer? My salesman called today, I get birthday cards, a subaru magazine, emails, service flyers/coupons..similar for our chevy truck. FR? They don't know (or seem to care) that I exist.

RV and Car - very different worlds. All they have in common is they use the same roads.

[prof_fate]

Kelly, Edmunds, etc used car values are nuts. Not sure where they get their internet quotes from.
Pretend you are BUYING what you are selling - that is what it is really selling for (or a bit lower). Easy enough to do these days.

A dealer will sell it for more - he does more to it, has to stand behind it, has higher costs and SALESPEOPLE and can get people financed. Less risk for teh buyer than if htey get it off Sam's front yard, some stranger on craigslist, etc
Remember - many people, particularly those looking at private party sellers, have been looking, are cheap, etc. They have IME a much better idea of the real value of the vehicle.

Do they offer 'low' prices? Compared to? WeBuyAnyCar? Nope. YOu're welcome to drive dealer to dealer and sell your car for cash to any of them (they all buy at auctions so why not from you?)
They will want a $2-3k spread between what they buy it for and ask for it when it's sales time. Sometimes more depending on the car/area, rarely less.

I've got my mother in laws car to sell...an 03 malibu. Trade in at any dealer is zip - over 100k they can't get financing so off to the auction it goes. $1000 tops value.
NADA/KBB? $4000!
No dealer in their right mind would pay $4k for it. I'm not sure they could GET 4k for it.
I'm thinking $2500 out of the front yard. 3k if it cleans up well and I can make the A/C work.

If you believe you're truck is worth $24,900 then sell it yourself for that.

I've had cars sell in a day and others sit for a YEAR in my yard/on CL. My expedition I gave up and traded for boat. KBB said it was worth $4500..best offer I got was $1500. I could have parted out just the transmission for more than that!

I don't know the 'secret' to fast, high price sales. A lot I think is luck (timing). And where you live and what you're selling. The car that sat for a year was a minivan - i live in an upscale area and mom's buy new minivans and kids don't want a MV for a first car.
the malibu MIGHT do well for a kids first car.

It's interesting the kinds of people you get looking at a specific kind of car or in a price range.

Originally Posted by schrederman

Car dealers... AAAAHHHHHHHHH!!!!!!!!!!!! Run!!!!!! Seriously, to me a dealer is a dealer... regardless of what he/she is selling. I'm looking for a new TV, now specifically a Ram 2500. My '11 F-150 has been electronically appraised and I've received a congratulatory (really??) message saying it's worth $15,500- from Auto Trader. The dealer wants to go by that... No thanks. NADA and Kelly both say it is worth right at $4,500- more but the dealer isn't going anywhere with that. Now, in my area, I looked at '11 F-150s and the cheapest was like mine, but with 89K miles and body damage, and the asking price was $24,900-... Seriously? I can't wait until I try to trade up with my RV...

Car dealers, boat dealers, rv dealers, etc......... Sheesh!!

[MillerTime]

I have found a website that does show rv invoices and msrp's and let's you add options and recalculates the numbers. Extremely accurate in my case. (I have a little bit of inside connections at our dealer, that aided in the accuracy of the site)

And on the auto side, (since I work for one) the actual profit on new cars is almost nil, unless they catch a sucker. The new car money is usually from the manuf. Based on volume and models sold vs- estimated sales. The service, parts and used car sales makes the dealership its real money.
And also most auto dealers are in it for the real estate as well.
At one dealer I was at, the body shop carried the whole dealership. It made more profit than any other department.

[keith_h]

Originally Posted by MillerTime

I have found a website that does show rv invoices and msrp's and let's you add options and recalculates the numbers. Extremely accurate in my case. (I have a little bit of inside connections at our dealer, that aided in the accuracy of the site)

And on the auto side, (since I work for one) the actual profit on new cars is almost nil, unless they catch a sucker. The new car money is usually from the manuf. Based on volume and models sold vs- estimated sales. The service, parts and used car sales makes the dealership its real money.
And also most auto dealers are in it for the real estate as well.
At one dealer I was at, the body shop carried the whole dealership. It made more profit than any other department.

What web site is it?

[DDC]

To a degree car dealers have been given a legislated conscience but rv dealers are still free to do to you as much as you will let them.

[MillerTime]

Originally Posted by keith_h

What web site is it?

Pm me.
I don't feel like promoting sites on a public forum unless they are a retailer that is in the industry.

[asquared]

I have dealt with both auto and rv dealerships in the last couple of months. I got lucky, the finance guy screwed up and I paid $5000 less than I should have for my truck. Of course they tried to correct the problem but since I had legal documents with the cheaper figures, they were stuck. They honored it (then again this is the second vehicle we bought from them in less than a year). Auto dealers have discounts for all kinds of different random things, i.e. chevy truck month, usaa, the dealers owner woke up happy that day or whatever. They don't like to come down without a stated discount. The problem is they know there are 8 chevy dealerships in a 1-2 hrs radius and they have to compete with them. They also know you can go to any chevy dealership for your service so that can't be a negotiating factor. Their hands are tied.

The RV dealership has fewer competitors nearby. I know of 4 dealerships in NC and 2 in VA that sell Sabres. You can go online and see dealer prices across the company on sites like rvtrader.com. you can then email a dealership nearby with a better price and negotiate. Remember that in the rv world there will be thousands different in price from one state to another due to shipping fees that are passed on to the seller. Why? Because larger RVs are shipped one at a time (little things like pop ups and rpods might go 2 or 3 onto a flatbed semi) whereas car dealerships can get an entire truckload in for 1 cost spread across multiple cars. You can also utilize manufacturer cost websites like seedealercost.com to get an idea of what your dealer paid for a specific unit but there is no guarantee that is accurate either. In the end, you end up educating yourself and playing one dealership against another in both industries. It is the only way to get a fair price either way. What is that fair price? It is the one both you and the dealership feels is acceptable and allows you room in your budget to camp and the dealership a chance to make a profit.