Are dealers profiteering?

[Simon Select]

Oh I do love these posts! Firstly it just sounds like a crap dealer. I can genuinely say I haven't increased any price and my new vans are still slightly below RRP.
In terms of buying stock for the year, its nothing to do with exchange rate, so with Bailey for instance, all the dealers meet Bailey in say June to see the 2021 models etc. We commit to our annual stock and the price is a set trade price.
Even when dealing with continental brand like Adria Sun Living, we don't actually buy from Adria, we buy the vans from Adria UK. It means again the trade price is set and we will know from day one what we have in each van.
If someone is selling above the RRP its purely down to greed.

 

[Simon Select]

In terms of car manufacturers etc, the pricing changes every quarter however if you order a car on the 29th of June at the end of the quarter, the vehicle will have price protection to make sure the deal itself does not fluctuate. Manufacturers in the motor trade will always try and protect the dealer with things like price protection etc etc as the margin a car dealer can make is literally 1 or 2 percent on a new car purchase. Customers seem to think a car dealer has thousands in a new car, it simply isn't the case.
What is interesting though, if a manufacturer tells a franchised car dealer to do something, they will do it or risk termination.
With a motorhome manufacturer, the manufacturer tells the dealer to do something and the dealer says do one and gets a different brand in!

 

[funflair]

I agree that it’s nothing to do with exchange rates when buying from Bailey or Adria UK, my example was our dealer buying from the German factory in €, so this just proves that all dealers are different so difficult to generalise.

 

[DiggerJon]

OK - how's this for a 'Bargain'

https://rover.ebay.com/rover/1/710-...0001&campid=5338547443&icep_item=293632419674

Looks like a shed conversion. Stick that one on a weigh bridge - if you dare!

 

[mikebeaches]

Oh I do love these posts! Firstly it just sounds like a crap dealer. I can genuinely say I haven't increased any price and my new vans are still slightly below RRP.
In terms of buying stock for the year, its nothing to do with exchange rate, so with Bailey for instance, all the dealers meet Bailey in say June to see the 2021 models etc. We commit to our annual stock and the price is a set trade price.
Even when dealing with continental brand like Adria Sun Living, we don't actually buy from Adria, we buy the vans from Adria UK. It means again the trade price is set and we will know from day one what we have in each van.
If someone is selling above the RRP its purely down to greed.

Sorry to be pedantic, but I just read on your website that:

"Bailey motorhomes have been manufactured in the UK for over 70 years..."

I thought the first Bailey motorhome was manufactured in 2011, ie about 9 years ago?

They may have been building caravans for longer, but surely not quite the same as 'motorhomes'?

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[Lucky]

Whoops, I got my sums wrong, sorry.

After adjustment for registration fee, RFL, automatic gearbox and engine upgrade, the price hike of £5749 above RRP of £42509 amounts to 13.5%, not the 10% I cited in the OP.

I've accounted for all options mentioned in the advert apart from the supposedly 'free' extension of warranty to 5 years.

There are simply not enough other factory options available to bridge the gap. However I now have another theory for the price hike...

The motorhome in question is a factory special edition which can no longer be ordered. According to the price list it came with extras worth £5679, remarkably similar to the price hike by the dealer. My guess is the dealer has dumped the special edition literature and is pricing the motorhome as a standard van plus charging for all the freebies thrown in by the factory.

Draw your own conclusions.

 

[peterc10]

What the dealers do is order a stock of vans from the converter for the new season, ensuring they are loaded up with factory-fitted optional extras.

The only way to get a motorhome at the RRP is to place an order with the the manufacturer. Problem there is, they take about 9 months to come through and by then the price has gone up... Doh!

As you say, they are in business to make money, and that is one way of increasing their revenue.

To be fair, I think it happens throughout the motor industry. The one difference being, it perhaps doesn't necessarily take 9 months to get a factory-order car. So perhaps more feasible to pay basic RRP for an options-free vehicle if you're prepared to wait say three months for delivery? I'm not an expert on factory-ordered cars, however, so maybe I'm wrong?

It doesn't always work like that. When I was looking for a new motorhome all of the new dealer bought stock was at or lower than the converter's price list figure taking into account the factory fit extras. I ended up buying one and getting 19% off the price list. But I was buying in late October, a notoriously slow period for dealers, and with next year's vans coming in when that year's were still unsold. But that does not apply now where many more people seem to want to buy a motorhome rather than fly.

It's a free market economy, and anything is only worth what somebody is willing to pay for it. In today's overheated seller's market the prices are higher than list, in a buyer's market they are lower. If the dealer is being "crooked" by selling for a higher price, that would make me "crooked" for buying at a lower price.

 

[mikebeaches]

It doesn't always work like that. When I was looking for a new motorhome all of the new dealer bought stock was at or lower than the converter's price list figure taking into account the factory fit extras. I ended up buying one and getting 19% off the price list. But I was buying in late October, a notoriously slow period for dealers, and with next year's vans coming in when that year's were still unsold. But that does not apply now where many more people seem to want to buy a motorhome rather than fly.

It's a free market economy, and anything is only worth what somebody is willing to pay for it. In today's overheated seller's market the prices are higher than list, in a buyer's market they are lower. If the dealer is being "crooked" by selling for a higher price, that would make me "crooked" for buying at a lower price.

Not disagreeing with anything you have said. Apart from you being crooked, for seeking to negotiate a lower purchase price.

But it does sound as though the van the dealer offered you was one with 'extras'. Now they may well have all been options you would have chosen to specify, in any case.

And of course, October is a potentially slow month for selling existing stock (which is by then effectively, a last year's model because the shinny new ones for the following year have already been announced).

But even then, a 19% discount sounds a great deal.

And at the end of the day, if you got the exact van you wanted, at a price you were happy to pay, then all is good.

As you and others have mentioned, supply and demand is clearly a factor currently, as is normally the case.

But I return to the premise, that it is difficult to find a motorhome - without extras - in stock, being advertised and sold at the lead in MRRP.

 

[Marmite]

Have the number of buyers actually increased resulting in a stock shortage, or is this just dealer hype?

 

[SpeedyDux]

Not disagreeing with anything you have said. Apart from you being crooked, for seeking to negotiate a lower purchase price.

But it does sound as though the van the dealer offered you was one with 'extras'. Now they may well have all been options you would have chosen to specify, in any case.

And of course, October is a potentially slow month for selling existing stock (which is by then effectively, a last year's model because the shinny new ones for the following year have already been announced).

But even then, a 19% discount sounds a great deal.

And at the end of the day, if you got the exact van you wanted, at a price you were happy to pay, then all is good.

As you and others have mentioned, supply and demand is clearly a factor currently, as is normally the case.

But I return to the premise, that it is difficult to find a motorhome - without extras - in stock, being advertised and sold at the lead in MRRP.

Agree with your last paragraph. In practice it may be impossible to actually buy a new popular marque MH off the dealer's forecourt in its base spec without extra "packs" or options. The basic list price before options is a marketing teaser. I would be extremely surprised if any dealer buys them into stock with the weediest engine, no cab A/C, no cab blinds, no passenger airbag etc. Hence so many dealer "specials" based on what they think attracts a customer most.

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[Coolcats]

Oh I do love these posts! Firstly it just sounds like a crap dealer. I can genuinely say I haven't increased any price and my new vans are still slightly below RRP.
In terms of buying stock for the year, its nothing to do with exchange rate, so with Bailey for instance, all the dealers meet Bailey in say June to see the 2021 models etc. We commit to our annual stock and the price is a set trade price.
Even when dealing with continental brand like Adria Sun Living, we don't actually buy from Adria, we buy the vans from Adria UK. It means again the trade price is set and we will know from day one what we have in each van.
If someone is selling above the RRP its purely down to greed.

Great insider observation on pricing, mind you from a sales perspective

 

[nicholsong]

We fixed the price of our van in € the dealer knew what he was going to pay as he has to pay in € so no scope for fluctuations, if we had been paying in £ the price moved about £25k just due to exchange rates and I would not expect the dealer to stand that loss.

I believe some dealers might have a fixed exchange rate for a given period but for me the only sure way was to fix in € so then we took the risk but we also controlled that risk in that we chose when to exchange.

Martin

Or buy your € forward

 

[Coolcats]

Or buy your € forward

When buying a car from a dealer that is made in Europe or any other goods you do not have to Worry about fluctuations and this was the case when we brought the Hymer. I think the OP about 2020 models no longer being available and the next batch is going to be 2021 models makes more sense for a price increase.

 

[SteveRallye]

We bought our M/H last year and the new 2020 model now is almost exactly 10K more. However the new model has just won best in class under 90k , so its not all bad and its not a German van ,even better. The best decision we made last year as we decided to buy that instead of a big cruise for this year for wedding anniversary.

 

[Coolcats]

We bought our M/H last year and the new 2020 model now is almost exactly 10K more. However the new model has just won best in class under 90k , so its not all bad and its not a German van ,even better. The best decision we made last year as we decided to buy that instead of a big cruise for this year for wedding anniversary.

Indeed you hear people say that they can almost get what they paid for thier not just this year but others, too is yours a mobilvleta ?

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[nicholsong]

We bought our M/H last year and the new 2020 model now is almost exactly 10K more. However the new model has just won best in class under 90k , so its not all bad and its not a German van ,even better. The best decision we made last year as we decided to buy that instead of a big cruise for this year for wedding anniversary.

I bought a sailing boat for £23,000 and cruised in it for 25 years and everything including food and booze probably cost me less than £90K.

 

[Cheshirecat57]

Just an observation, I reckon the greediest motorhome vendors are private individuals NOT dealers

I bet Simon Howard gets toe-dropped a lemon of a px more times than I’ve had a hot dinner

PROFIT is not a dirty word, if you don't like a price don't buy it.
If you are happy with your negotiated price...cool, you have done well,but I guarantee someone would have bought cheaper AND someone will have paid more

 

[Coolcats]

Just an observation, I reckon the greediest motorhome vendors are private individuals NOT dealers

I bet Simon Howard gets toe-dropped a lemon of a px more times than I’ve had a hot dinner

PROFIT is not a dirty word, if you don't like a price don't buy it.
If you are happy with your negotiated price...cool, you have done well,but I guarantee someone would have bought cheaper AND someone will have paid more

Indeed the art of the sale is both seller and buyer are satisfied with the deal.

 

[Rob Turner]

It doesn’t matter if the dealer puts 50% on the price. You don’t have to buy it!

 

[Lucky]

The question is "are dealers profiteering", not are dealers acting illegally or should someone pay the price being asked.

Profiteering is commonly defined as making large profits by charging high prices for goods that are hard to get.

Seems to fit the bill to me.

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[Langtoftlad]

1. I doubt any dealership will make a profit this year... just a question of staying in business and containing losses.
2. Has the OP actually asked why the van in question is priced so much higher than the RRP?

 

[Cheshirecat57]

1. I doubt any dealership will make a profit this year... just a question of staying in business and containing losses.
2. Has the OP actually asked why the van in question is priced so much higher than the RRP?

Cant personally work out the point of the original post
One either believes in the free- market or not
”profiteering” is a very emotive word to me Im afraid ( used in this context)

 

[Rob Turner]

I only buy my vans in Germany so save every time. Win Win.

 

[Langtoftlad]

Price fixing was outlawed in the UK many years ago

RRP = Recommended Retail Price.

 

[Langtoftlad]

I only buy my vans in Germany so save every time. Win Win.

Good for you... presuming the German dealers have the brand/model you want... and are happy to go through the various importation hurdles.

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[Rob Turner]

Good for you... presuming the German dealers have the brand/model you want... and are happy to go through the various importation hurdles.

No hurdles!

 

[Langtoftlad]

No hurdles!

If you say so...

 

[Lucky]

Cant personally work out the point of the original post
One either believes in the free- market or not
”profiteering” is a very emotive word to me Im afraid ( used in this context)

The point is I don't believe new vehicles should be retailed at a price significantly above the manufacturer's recommended price. It's profiteering whether one likes the word or not. One might rightly celebrate the free market but that doesn't mean consumer protection isn't important.

I understood the principle of RRP was introduced to protect buyers, and imo overcharging by multiple thousands of pounds drives a coach and horses through that protection.

I'm surprised I'm in the minority but I accept that is so.

Tbh I haven't asked why the van is priced the way it is but I'm tempted to ring tomorrow and ask. Watch this space.

 

[Marmite]

Price fixing was outlawed in the UK many years ago

RRP = Recommended Retail Price.

Interesting.... Apple products seem to be the same price everywhere... No. Price fixing there.... Just that all retailers come to exactly the same conclusion on what they charge and be competitive

 

[Langtoftlad]

Interesting.... Apple products seem to be the same price everywhere... No. Price fixing there.... Just that all retailers come to exactly the same conclusion on what they charge and be competitive

...and?

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