Dealers refusing to budge on very old inventory

[Mursilis]

I spent some time this weekend on Cars.com, and came across a listing for a NEW 2014 Chevy Volt. Figuring someone had just forgotten to delete it over the years, I went to the dealer's own website, and there it was, a brand new 2014 Chevy Volt with a modest $4000 or so discount. I find this quite interesting - the 2014s are still first-generation Volts, and there's a new (and better) Volt currently available for the same price, or possibly cheaper. Plus, the Bolt is coming out, etc. Spending more time on Cars.com, I found a bunch of still new inventory from local dealers going back to 2013(!) (Hyundai Sonata Hybrids). Some of this stock was priced at significant discounts, but a lot of it was listed with very modest mark-downs, like the 32 2015 Mitsubishi Lancer Evolutions available within a 100 miles of zip.

A car (unless it's a current or future classic) is a depreciating asset, and it's costing a dealership money in financing costs to have it sit there for years. Anyone have any idea why a dealer would be unlikely to budge on 2015 and older new car inventory like that? It doesn't seem to make rational sense.

 

[monkeydelmagico]

You assume it is costing then money but there may be incentives for the dealer to hold on to old new stock. Probably some form of creative accounting at work that makes it profitable. Otherwise they would move the metal.

 

[JulesMaximus]

No way would I buy one for only $4k off. Look at what a low mileage used 2014 Volt sells for and that is where I would start negotiations.

 

[Mursilis]

No way would I buy one for only $4k off. Look at what a low mileage used 2014 Volt sells for and that is where I would start negotiations.

You're right that $4K off is barely an incentive at all, and I'm not interested in that particular car - more the fact that this dealer (and a bunch of other local dealers) really don't seem all THAT motivated to move some old inventory. Another Chevy dealer has a leftover 2015 Spark EV, and has a $10K discount listed on their website - something like that I'd be interested in, and it looks like they're honestly trying to move their inventory. Only $4K off a 2014 Volt is a joke - it's almost 3 years old AND a much better version is available.

 

[Mursilis]

You assume it is costing then money but there may be incentives for the dealer to hold on to old new stock. Probably some form of creative accounting at work that makes it profitable. Otherwise they would move the metal.

Maybe, but I'm not sure how that "creative accounting" would work. Don't dealers have to eventually pay the manufacturer for their stock?

 

[Midwayman]

Maybe, but I'm not sure how that "creative accounting" would work. Don't dealers have to eventually pay the manufacturer for their stock?

Maybe they got some special interest deal on it from Chevy? I know the bolts were really stacking up there for awhile. Maybe it costs nothing to sit on, but if they sell it they have to write down the loss?

 

[JulesMaximus]

You're right that $4K off is barely an incentive at all, and I'm not interested in that particular car - more the fact that this dealer (and a bunch of other local dealers) really don't seem all THAT motivated to move some old inventory. Another Chevy dealer has a leftover 2015 Spark EV, and has a $10K discount listed on their website - something like that I'd be interested in, and it looks like they're honestly trying to move their inventory. Only $4K off a 2014 Volt is a joke - it's almost 3 years old AND a much better version is available.

Plus, the moment you sign the paperwork you are the owner of a 3 year old used car. The ONLY thing it has going for it is that the warranty period hasn't started yet. Although, I'd make damned sure that was the case before buying it.

 

[RLGL]

Maybe, but I'm not sure how that "creative accounting" would work. Don't dealers have to eventually pay the manufacturer for their stock?

The minute the vehicle comes off the truck , it is listed on the dealers floor plan. The interest starts accruing
according to the terms of the note at a set number of days after delivery.

 

[GagHalfrunt]

Maybe, but I'm not sure how that "creative accounting" would work. Don't dealers have to eventually pay the manufacturer for their stock?

They do, buy likely it's not costing them anything to have it there. With some older and slower selling vehicles the manufacturer will allow them to be taken off the floor plan and just sit there free.

 

[Zivic]

EVO is a future classic....

 

[Mursilis]

EVO is a future classic....

It may be, but is it actually worth more than MSRP? I'd guess not if there are still 30+ 2015s available within 100 miles of me listed at or below list price.

 

[Pacfanweb]

No way would I buy one for only $4k off. Look at what a low mileage used 2014 Volt sells for and that is where I would start negotiations.

Except you'd be buying a brand new Volt that has the full warranty left, vs. a used 2014 that has maybe one more year left on the base warranty.
Warranty doesn't start until it's bought, no matter when that is. You're not getting it THAT cheap.

That said...OP, you don't know the dealer won't come off the car a lot more unless you call and ask. Or go by. I'd about guarantee they would, but they might just not advertise it. They know as well as you that the value of it will not be the same as if it was a current year model.

 

[Mursilis]

Except you'd be buying a brand new Volt that has the full warranty left, vs. a used 2014 that has maybe one more year left on the base warranty.
Warranty doesn't start until it's bought, no matter when that is. You're not getting it THAT cheap.

That said...OP, you don't know the dealer won't come off the car a lot more unless you call and ask. Or go by. I'd about guarantee they would, but they might just not advertise it. They know as well as you that the value of it will not be the same as if it was a current year model.

I'm interested in either a hybrid or a full electric car, but not necessarily a first-generation Volt, which only seats 4, so I'm not really in the market for THAT particular car - I was just more curious as to why the dealer doesn't seem all that willing to deal on it, based on the fact that it's still on his lot and has been for at least two years. Just last year (late spring 2105), we got an amazing deal on a leftover 2014 Focus, so clearly some dealers recognize that there's no rational reason to hang on to old inventory which is only depreciating AND costing the dealer money. Looking at the online listings, it's amazing how many haven't gotten that message.

 

[JulesMaximus]

Except you'd be buying a brand new Volt that has the full warranty left, vs. a used 2014 that has maybe one more year left on the base warranty.
Warranty doesn't start until it's bought, no matter when that is. You're not getting it THAT cheap.

That said...OP, you don't know the dealer won't come off the car a lot more unless you call and ask. Or go by. I'd about guarantee they would, but they might just not advertise it. They know as well as you that the value of it will not be the same as if it was a current year model.

I already stated that.

Plus, the moment you sign the paperwork you are the owner of a 3 year old used car. The ONLY thing it has going for it is that the warranty period hasn't started yet. Although, I'd make damned sure that was the case before buying it.

If this were a Toyota I wouldn't hesitate to buy a 3 year old Prius with 1 year left on the warranty. Not sure how reliability is on the Volt though.

 

[Tweak155]

It's possibly used as a sales tactic for current model years? "Yeah, they just hold their value, isn't MSRP on this new model year great??"

 

[Thump553]

Aren't there things on a car that wear out just through the passage of time-like tires, for example? I would expect a heavy discount for a new old stock car-and especially so if the warranty is shortened.

On the warranty issue, don't car warranties start with the date of the first private titling and not the date of manufacture?

 

[Pacfanweb]

Aren't there things on a car that wear out just through the passage of time-like tires, for example? I would expect a heavy discount for a new old stock car-and especially so if the warranty is shortened.

On the warranty issue, don't car warranties start with the date of the first private titling and not the date of manufacture?

Yes, warranty doesn't start running until the car is put into service.

I saw several examples of this when I worked at a very large Ford dealership.
One was in 1998, I had a customer who had a brand new 1995 Taurus SHO. Had been "forgotten" on one of our satellite storage lots for 3 years.
His new car warranty (3/36) didn't run out until 2001.

 

[OverVolt]

I would never touch it with a 10 ft pole. Cars decay by sitting. Cars need to move. Thats 2-3 years of sitting wear and tear and you aren't compensated accordingly.

The used car market is astronomically overpriced in my opinion.

 

[FelixDeCat]

I would never touch it with a 10 ft pole. Cars decay by sitting. Cars need to move. Thats 2-3 years of sitting wear and tear and you aren't compensated accordingly.

The used car market is astronomically overpriced in my opinion.

You haven't heard? Everyone is rich these days. Prices for anything are no longer relevant.

 

[Dr. Detroit]

Found a dealer with 2 2015 Camaro SS's in stock and they have 15 2017's on the lot. Not sure the 20% discount is enough to move them.