Published on March 22nd, 2017 | by Steve Hanley0
Chevy Bolt Pricing Changes With The Wind
March 22nd, 2017 by Steve Hanley
Originally published on Gas2.
The Chevy Bolt is now available in 7 states. If you want one, it may pay big dividends to shop around. In a pattern that is typical for clueless franchise dealers, some are offering steep discounts on the cars while others are tacking on equally steep dealer markups.
Last week, a dealer in southern California was advertising the Bolt for $4,439 less than an identical car at another dealership just 5 miles away. “We’ve been really aggressive in getting it out there and getting people’s attention,” said Marty Greenwood, managing partner of Greenwood Chevrolet, about 100 miles south of San Francisco. It is advertising discounts of $2,000 to $3,000 on its Bolt inventory this month.
“We’re here to sell cars, and we’re in a smaller town, so we need to be a little bit more aggressive,” Greenwood said. “We just watch the market and what’s going on out there. What is the magic number to move the vehicle?”
Uh, hello? Mr. Greenwood, sir? Have you considered actually selling the benefits of an electric car to people or are you just stuck in the “car dealer as horse trader and snake oil salesman” paradigm from the 1930s?
Factor in the $7,500 federal tax credit and $2,500 California EV rebate and California customers can put a base model Bolt in their driveways for fewer than $25,000. Nationally, the average amount consumers paid below sticker price grew from $1,400 in January, a 3.4% discount, to $2,200 in February, a 5.3% discount, according to TrueCar.
Chevrolet is not offering any cash-back incentives on the Bolt, so any dealer discounts reduce the amount of profit the dealers make on the cars and have no impact on how much GM profits (if any). “If somebody’s marking them down, it’s coming out of their margin,” GM spokesman Jim Cain said. “Dealers are independent businesses, and capitalism at work tends to drive local market pricing.”
Dealer markups on the Bolt are occurring mostly in rural areas where there are fewer dealerships and less inventory. Several dealers listing Bolts for as much as $5,000 above sticker price didn’t return messages from Automotive News seeking comment. Cain said GM discourages dealers from adding a markup, but can’t stop them.
At Harbor Chevrolet in Long Beach, California, all 21 Bolts shown on its website are discounted by at least $1,285. One Bolt Premier is $4,160 off, a nearly 10% markdown. Another nearby dealership listed 32 Bolts in its inventory, with two priced at discounts of more than $5,200.
“We price every single vehicle in inventory to move,” said Sergio Navarrete, a Harbor Chevrolet sales manager. “Our business model is more geared toward volume vs. any one sale. Per unit we make less, but long term it works out better.”
Elon Musk explained his reasons for not using conventional auto dealers in a blog post in 2012. “Existing franchise dealers have a fundamental conflict of interest between selling gasoline cars, which constitute the vast majority of their business, and selling the new technology of electric cars,” he said. “It is impossible for them to explain the advantages of going electric without simultaneously undermining their traditional business.”
Once again, Elon is right on the money. If you want to deal with the usual flimflam and bamboozle practices employed by a conventional auto dealer, buy a Bolt. If you want to order your car online and have it built to your exact specifications with no funny business about price, buy a Tesla.
The unending stupidity of conventional car companies and dealers is really beyond belief. It gets easier to understand every day how these companies could find themselves out of business a few years from now and never understand how it happened. “Clueless” is the only adjective that seems accurate.
Source: Automotive News