... .. ... GM plans to cut the haggling over car prices. Will it work?

[Analog]

Starting with its 2006 models, the world's biggest automaker plans to narrow the gap between sticker and actual selling prices to strengthen its brands, damaged by years of discounting. GM plans to cut the haggling over car prices. Will it work?


http://info.detnews.com/autostalk/lette...ic=GM_to_go_hagglefree&forum=autostalk

 

[Acanthus]

It worked for saturn, a lot of people loved the "no haggle" fixed pricing.

 

[Engineer]

I think that all automakers and dealers should do this. I don't go into Wal-mart and get a better price because I can negotiate better than someone else. The prices should be fixed for all.

 

[Rogue]

When I realized that USAA would haggle for me on the purchase of a new car, I realized that I don't ever want to haggle on a car price again. Whether someone does it for me or I never have to do it again, I don't care, just as long as I don't have to do it.

 

[PhlashFoto]

Wow, am I in the minority who likes haggling? But I just make an offer, if no, then I just leave. I dont go back and forth Not just cars, mostly anything, especially used stuff.

 

[HumblePie]

I like to haggle... and I've been car shopping for 2 weeks now

Seriously though, if car dealers would just set the price at 2% above what they pay for profit, I mean what they REALLY PAY, just like almost any other mainstream product on the market, things would be sooooo much nicer for car shopping.

 

[Kelemvor]

If dealerships were totally and completely up front and told everyone exactly what they paid for each vehicle, people would be a lot more willing to do the No Haggle thing. But when they always try to keep it a secret, try to mislead you into believeing things that aren't true, etc.. People assume they have to haggle or they are getting screwed.

Car Dealerships have used crappy tactics for so long, lots of people would be really scared about No Haggling because they'd still think they were getting screwed but now had no recourse...

 

[mugs]

I think a lot of men like haggling because it lets them feel like they "beat" the dealer. This will rob them of that sense of accomplishment.

A lot of people also think if a car dealer makes a profit they're ripping them off... with set pricing they'll know they're making a profit.

I do know a woman who bought her Saturn because she thought the Honda dealership was trying to rip her off because they wouldn't go as low as she wanted on the price, so instead they offered her a longer loan term. This will be great for people like that, they'll have more than one brand to buy from. But if GM wants to get out of the mess they're in, they ought to focus on making better cars, not just better ways to sell the crappy ones.

 

[dman]

So, the Dealers will add on Pin Striping and Undercoating and other stuff, warranty, etc, that you'll have to haggle over instead. They'll also change the focus to the financing and trade-in's and other things.

If it was a winning concept there'd be more 'No haggle' dealers today. You can already go there and buy cars without haggling, but you'll probably pay more than if you spent a few hours shopping and haggling elsewhere.

If you don't like haggling you can also use an interenet fleet service (like autobytel) and buy cars at $x over invoice which will save you time and some money, but, if you are a good / annoying haggler you can get cars for below invoice, etc.

Good luck to GM.

 

[Wag]

Nothing is going to work for GM at this point.

 

[HardcoreRobot]

i think its a good idea bc it simplifies the process. on the other hand, gm's problem is their product not their method

 

[sniperruff]

even if they lower the prices, people will still try to push the prices down.

 

[Gibson486]

I think GM needs to go back to the drawing board and actually engineer a good car. I mean, come on.....they sold there Cavaliar for how many years with out a major over haul?

 

[Wag]

Originally posted by: Gibson486
I think GM needs to go back to the drawing board and actually engineer a good car. I mean, come on.....they sold there Cavaliar for how many years with out a major over haul?

I recently test drove the Chevy Cobalt, the replacement for the Cavalier.

If that's the best they can do, they are doomed.

 

[vegetation]

It's not going to help GM. They'll initially gain some of the women who don't like to haggle, but they'll be swayed away when they realize that Toyota they test drove was just so much better in quality. Pricing methods should not be the focus of GM right now. Heck, they've probably spent tens of millions doing studies on this issue -- money that should have been spent on making their cars better in the first place.

 

[Squisher]

I have to believe this is one of the incentives behind the success of the , "employee price for everyone" scheme.

 

[MercenaryForHire]

Short answer: No.

- M4H

 

[hypn0tik]

Originally posted by: vegetation
It's not going to help GM. They'll initially gain some of the women who don't like to haggle, but they'll be swayed away when they realize that Toyota they test drove was just so much better in quality. Pricing methods should not be the focus of GM right now. Heck, they've probably spent tens of millions doing studies on this issue -- money that should have been spent on making their cars better in the first place.

Agreed.

You can only sell low quality cars for so long and get away with it. When the average consumer realizes that they are buying junk, they're going to stop buying it. The 'pay what the employee's pay' or the '20 cents off every litre of gas for one year (for some models in Canada)' is just their last attempt at selling cars. Yet, I highly doubt they are making much money.

Quality > quantity.

 

[Engineer]

Originally posted by: Wag
Nothing is going to work for GM at this point.

I don't know...their 46% sales increase from their "everyone gets employee price" worked pretty well. Imitation is the sincerest form of flattery - Ford, DCM are now doing it also. Won't work long term, but worked great in the short run. Lowered their inventory by 26% in one month! :Q

Add the fact that *GULP*, GM is slowing rising in quality and reliabiltiy....but their product mix, IMO, still is aging and lacks innovative designs to maintain the short term pickup in sales.

 

[jcovercash]

Hell NO! I love Haggling over car prices.... You can get it at a lot better price than they offer if you know the right things to say....

Man thing is if they wont work with you and your being resonable. Just say "Well thanks for your time, the dealership down the road will be up here in a couple of hours to pick up your car from you, when I purchase it through them"... That always gets them a little more willing to talk.

 

[JulesMaximus]

You can get a better price by haggling. Fixed pricing just means that you get screwed for a set amount.

There is a whole line of dealerships here in San Diego with fixed pricing (Mossy), I went there when shopping for my Maxima but they were unwilling to negotiate on price. I ended up buying my car in Costa Mesa for over $1,000 less than what Mossy was charging for the same exact car!

Would you drive 50 miles to save $1,000?

 

[Wag]

Originally posted by: Engineer

Originally posted by: Wag
Nothing is going to work for GM at this point.

I don't know...their 46% sales increase from their "everyone gets employee price" worked pretty well. Imitation is the sincerest form of flattery - Ford, DCM are now doing it also. Won't work long term, but worked great in the short run. Lowered their inventory by 26% in one month! :Q

Add the fact that *GULP*, GM is slowing rising in quality and reliabiltiy....but their product mix, IMO, still is aging and lacks innovative designs to maintain the short term pickup in sales.

As already noted it's probably too little too late. Unless GM radically changes their designs and reliability they are in big trouble. Frankly, mid-range Asian cars are much more appealing to me than GM is at this point.

I drove that Cobalt, and frankly it seemed like a plastic POS. The Civic, Mazda3 and its other competitors I've tested just seemed like a much better car.

 

[GagHalfrunt]

Originally posted by: vegetation
Pricing methods should not be the focus of GM right now. Heck, they've probably spent tens of millions doing studies on this issue -- money that should have been spent on making their cars better in the first place.

That's the answer. GM isn't in trouble due to pricing, they're in trouble due to a bad product line. No-haggle pricing is a band-aid on a bullet wound. You're get some extra people into the show rooms if you make the buying process less painful, there's no doubt about that. The secret to getting the most people into the show room is having cars that they want to buy.

 

[Nebor]

I hate haggling. It's ridiculous. Everyone should get the same price on things, IMO. I'm tired of having to get one of those proffesional haggler "car purchase liasons" out of the phone book.

I simply can't haggle myself. It's not in me. It seems petty and cheap.

 

[Engineer]

Originally posted by: Wag

Originally posted by: Engineer

Originally posted by: Wag
Nothing is going to work for GM at this point.

I don't know...their 46% sales increase from their "everyone gets employee price" worked pretty well. Imitation is the sincerest form of flattery - Ford, DCM are now doing it also. Won't work long term, but worked great in the short run. Lowered their inventory by 26% in one month! :Q

Add the fact that *GULP*, GM is slowing rising in quality and reliabiltiy....but their product mix, IMO, still is aging and lacks innovative designs to maintain the short term pickup in sales.

As already noted it's probably too little too late. Unless GM radically changes their designs and reliability they are in big trouble. Frankly, mid-range Asian cars are much more appealing to me than GM is at this point.

I drove that Cobalt, and frankly it seemed like a plastic POS. The Civic, Mazda3 and its other competitors I've tested just seemed like a much better car.

I do admit that many domestic cars (big 3) make their cars with too much plastic. I sold my 1996 Intrepid and purchased a 2003 model several years ago. The interior was such a downgrade from the 1996 model. The entire plastic console looks more like a toy than anything else. The 1996 model was padded and very solid (no squeaks, rattles). The 2003 model rattles and squeaks. The quality, at least in the interior department, is just not there. Trying to cut corners, I agree, never will solve anything.

Who knows. Unless GM gets UAW concessions, you might be right.