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The dealer selling aftermarket parts?


Gary A

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I've seen this name a few times Magneti Marelli a division of Mopar. Never thought much of it and today I saw this piece of junk mail and never heard anybody comment on this before.

 

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Start LLC for $0 at IncFile


Start LLC for $0 at IncFile


Start LLC for $0 at IncFile

Perhaps the most disturbing with the new car dealers is their quest to gain our market share. They are competing on price. This will end up hurting their brand and how we are positioned.

 

A customer brought in a flyer from a local Toyota dealer and I could not believe the pricing, a lot cheaper then what I charge for LOFs, Brake jobs, wheel alignments, tire rotations and more.

 

Will this dictate pricing for the consumer? Does the motoring public look at the dealer what service and repairs should cost? Will the consumer know the difference?

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Our local Toyota kills me on pricing in most cases, yet they have 10 more techs and a much higher overhead. Sure hope they sell a lot of cars!

 

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I'm actually curious on overall dealer overhead. I bet as a percentage of repair, it is actually less than ours. The dealers in Atlanta have huge 20+ bay warehouses and can really get some solid economies of scale going. With a shop that big they can specialize in a bunch of areas, have steady work flowing into each of them, and crank through a ton of low priced repairs, and still come out with a great profit in the bank.

 

Honestly, I'm not surprised they are lowering prices. With their structure, they could easily undercut most independents and still make a bunch of cash. It's Wal-Mart level scale vs. a small mom and pop grocery store.

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I'm actually curious on overall dealer overhead.  I bet as a percentage of repair, it is actually less than ours.  The dealers in Atlanta have huge 20+ bay warehouses and can really get some solid economies of scale going.  With a shop that big they can specialize in a bunch of areas, have steady work flowing into each of them, and crank through a ton of low priced repairs, and still come out with a great profit in the bank.

 

Honestly, I'm not surprised they are lowering prices.  With their structure, they could easily undercut most independents and still make a bunch of cash.  It's Wal-Mart level scale vs. a small mom and pop grocery store.

That's an interesting concept. I've always felt our local dealers left a lot to be desired quality wise. I always assumed they had a higher overhead. Our local dealers are all single store setups except for imports which all seem to be chain stores.

If your thoughts are in fact the case a good portion of us may be working for a dealer when it's all said and done!

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