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TOV Forums > Accord > > Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.

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deandorsey
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Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-12-2018 11:12
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They also have at least one new 2015 Insight. That was my fun find on my Sunday drive.

Chris_6MT
Profile for Chris_6MT
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-12-2018 13:55
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Iím imagining that they donít assign an inventory or lot cost and wonít go below invoice on these. Most dealers will dump cars after 90 or 120 days.
superchg2
Profile for superchg2
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-12-2018 16:49
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The 2015 CRZ seems to have been there for about 3 years. They need to move it from time to time
so that it doesn't get asphalt sores.



KyDave95
Profile for KyDave95
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-13-2018 00:47
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I know the CR-Z isn't the most practical vehicle for a charitable cause, but if it's that difficult to sell, perhaps it could be donated to an organization or individual in need of transportation? If I had a dealership and a vehicle sat on my lot for an extended time, I would be looking to find some way to put that vehicle to good use in the community...
silverf16
Profile for silverf16
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-13-2018 09:28
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Many dealers across the country still have brand new 2014 and 2015 VFR interceptors sitting in showrooms. Heavely discounted but not moving.
Chris_6MT
Profile for Chris_6MT
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-13-2018 09:32
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KyDave95 wrote:
I know the CR-Z isn't the most practical vehicle for a charitable cause, but if it's that difficult to sell, perhaps it could be donated to an organization or individual in need of transportation? If I had a dealership and a vehicle sat on my lot for an extended time, I would be looking to find some way to put that vehicle to good use in the community...


+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.

KyDave95
Profile for KyDave95
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-13-2018 16:59
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Chris_6MT wrote:

+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


I wonder if a 2015 CR-Z could possibly be the oldest "new" car for sale in the US???

Chris_6MT
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Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-13-2018 20:59
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KyDave95 wrote:
Chris_6MT wrote:

+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


I wonder if a 2015 CR-Z could possibly be the oldest "new" car for sale in the US???



You can run that search on autotrader or cars.com. Filter new cars and sort oldest model year to newest. Last I looked I found some that were older. I recall calling a local dealer about a 3 year old Ďnewí Sonata Hybrid for the wife, they wouldnít go below $5k off. New 2018ís were listed for less by other dealers. GLWS lol.

DCR
Profile for DCR
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-14-2018 01:46
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Chris_6MT wrote:
+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


Well, you need a buyer. Unless you drop your pants and lose thousands on the car to chop the sale, you might be better off losing a slower drip on a car that isn't popular but has a specific Honda buyer who might locate it.

NorCalSales
Profile for NorCalSales
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-14-2018 10:07
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DCR wrote:
Chris_6MT wrote:
+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


Well, you need a buyer. Unless you drop your pants and lose thousands on the car to chop the sale, you might be better off losing a slower drip on a car that isn't popular but has a specific Honda buyer who might locate it.



The concept is right but in reality the costs of holding are significantly higher in the end. Nevermind lot damage and dead batteries and the like....flooring alone will absolutely murder you in the long run. Interest rates are up and flooring is no longer a profit maker for most dealers.

Chris_6MT
Profile for Chris_6MT
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-14-2018 11:47
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NorCalSales wrote:
DCR wrote:
Chris_6MT wrote:
+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


Well, you need a buyer. Unless you drop your pants and lose thousands on the car to chop the sale, you might be better off losing a slower drip on a car that isn't popular but has a specific Honda buyer who might locate it.



The concept is right but in reality the costs of holding are significantly higher in the end. Nevermind lot damage and dead batteries and the like....flooring alone will absolutely murder you in the long run. Interest rates are up and flooring is no longer a profit maker for most dealers.



Yes. The fact that some dealers donít even consider inventory cost boggles my mind. They could have sold the CR-Z 4 years ago at a steep discount. But instead theyíve paid for all that cost for 4 years and still will have to settle for a steep discount. Thousands of dollars down the drain.

NorCalSales
Profile for NorCalSales
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-14-2018 15:43
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One moved at auction last month for 13,200 with only 9k miles
KyDave95
Profile for KyDave95
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-15-2018 00:37
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Chris_6MT wrote:
KyDave95 wrote:
Chris_6MT wrote:

+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


I wonder if a 2015 CR-Z could possibly be the oldest "new" car for sale in the US???



You can run that search on autotrader or cars.com. Filter new cars and sort oldest model year to newest. Last I looked I found some that were older. I recall calling a local dealer about a 3 year old Ďnewí Sonata Hybrid for the wife, they wouldnít go below $5k off. New 2018ís were listed for less by other dealers. GLWS lol.



Oh, cool...I didn't realize that search option was out there!

brassrox
Profile for brassrox
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-16-2018 20:24
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NorCalSales wrote:
DCR wrote:
Chris_6MT wrote:
+1. I think itís the difference between a well run and poorly run dealership. A poorly run one will sit on inventory indefinitely, not even considering how much money said inventory is actually costing them. Well run ones will keep the inventory rotating constantly because itís actually cheaper to take a loss than to sit on a car for years.


Well, you need a buyer. Unless you drop your pants and lose thousands on the car to chop the sale, you might be better off losing a slower drip on a car that isn't popular but has a specific Honda buyer who might locate it.



The concept is right but in reality the costs of holding are significantly higher in the end. Nevermind lot damage and dead batteries and the like....flooring alone will absolutely murder you in the long run. Interest rates are up and flooring is no longer a profit maker for most dealers.



Can you explain that for those of us less acquainted with dealership economics? Is this essentially like opportunity cost, where the dealer having the money tied up in the old CR-Z prevented them from selling say, 10-15 CR-Vs over the same time period because the older models were using up dealer capital and floor space that could have been turned a bunch of times?

NorCalSales
Profile for NorCalSales
Re: Local dealer has a bunch of new 17 Accord Tourings in front of building.    (Score: 1, Normal) 08-16-2018 21:53
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Easiest way to explain it is to link

https://en.wikipedia.org/wiki/Retail_floorplan

The key on new is we get paid credit to floor the cars for awhile from Honda, as long as I can spin the cars faster than that I can end up with more credits than debits and put money on the books instead of paying out to the bank. The other part of that is this is money you don't pay commissions on so they are real dollars made rather than a dollar in "profit" on a car that the commission payout is around 38%. In other words a dollar saved in flooring is a real dollar in profit, a dollar made in a car deal is only about 62 cents. I am not sure that entirely makes sense outside of my head but hey that's how I am hardwired to think at this point as a GSM.

I will add any dealer that is flooring their used cars is pretty crazy. Paying interest on a depreciating asset is suicide especially if you don't implement a hard 60 day turn... if it hasn't sold it MUST go to auction, better to take a wholesale loss now and bandage up rather then bleed yourself dry.


 
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