Quality leads to poor dealers

Apr 13, 2008 2 Replies

"Newfound reliability has dealers losing money on warranty work.



The National Automobile Dealers Association estimates dealers currently lose $30 on every new car they sell



They make up the difference through financing, add-ons, service and warranty work.



[U.S. car dealers earned $7.7b on warranty repairs last year.]

With warranty work shrinking, they'll have to earn more money elsewhere.



Line of aftermarket accessories called "Customs" focusing (so to speak) on "high-profit items like custom wheels and electronics."



So in addition to paint protection, window etching and LoJack,



Dealers will be hawking factory-authorized customization.



Pimp my profits?"


My former boss (who is retired) has a son who's entire business is dealer-intstalled customization for GM cars and trucks. He's got like 25 employees and their customers are all auto dealers.

Dealers are what customers are important to a carmaker because they are what the customers talk to the most. If they can not make money selling cars there is something going wrong.

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