S55inPA

hey guys,

on another forum it was mentioned that the C and E classes were selling beneath dealer invoice. i for one find this hard to believe. can any E class owners lend some information? thanks!

Dema

Cool, I'm also interested in. A friend of mine was going to buy 545 and dealer asked for $500 deposit and long waiting list. So, why wait and pay sticker.

Brav

I got my ordered E500 "Sport" at invoice.. but they are in much shorter supply.

E320s go for under invoice on the left coast. CA seems to have the deepest discounts, 1-3K under. Overflooded here, I guess.

grizbo

Nice Chrysler!

woodie

I think those prices are mostly on the West coast.

codex57

It's true. Here in SoCal, standard price for an E320 non-sport seems to be $2K under invoice. Sport and E500s go for $1K under I think. Well, I know the E320 Sport does cuz that's what we got it for.

C classes are supposed to go well under invoice as well.

Not as great as the Ford discounts ($4K under) but pretty good for a luxury car.

nyca

is it that the economy in SoCal is so bad, or did they just build up too much car sales capacity during the boom years so now dealers are overflowing with higher end cars?

it just seems that the market would eventually correct on its own. why are dealers selling an endless supply of Es and losing money on them in SoCal, when the same cars could be sold in the NY metro area for example near MSRP?

codex57

I'm gonna guess it's a combination of too many dealers in the area and their invoice price is more than offset by hidden factory rebates, holdbacks, or whatever to allow them to make a profit even when they sell below invoice.

If you look at American cars, they routinely sell for thousands under invoice. The dealers still make tons of money. So, the manufacturer is subsidizing the dealers somehow (whether through rebates or whatever) so that the "invoice" isn't really the true cost to the dealer.

nyca

I don't think there is any "money in the trunk" from mbusa to dealers only in SoCal. what sense would that make, when mbusa can just send some of the cars to NY and sell them and get full price?

i think what is more likely happening is that dealers are willing to lose money on some models to get higher allocations on models that they sell for full MSRP (or over sticker). Like the AMG cars, the SL, S 4MATICS, etc. this is part of the game they are playing.

codex57

Could be, but on the other hand, if MB thinks it needs to throw some cash at the dealers to compete with say BMW or Lexus in SoCal and still make some profit, why not. I have no numbers, but I suspect the sheer numbers of cars sold in California outnumber those in NY. So, instead of just making full profit in NY (say $10 just as an example) where only so many can be sold anyways, why not in addition to that make another $7 in profit in California but sell a bunch more and gain marketshare there rather than keep prices high and lose sales to competitors.

Plus, I know the E class is the volume model for Mercedes. C class too to a lesser extent. I don't think dealers here could possibly make enough at full MSRP on a small number of say SLs to cover what they lose on the large number of E and C classes they sell.

indus

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Quote:
I don't think there is any "money in the trunk" from mbusa to dealers only in SoCal. what sense would that make, when mbusa can just send some of the cars to NY and sell them and get full price?
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Dealers do not loose money when they sell an E320 @ 2K under invoice, they just dont make as much:-) (there is approximately 7% profit in these cars on the back end).

MBUSA does not make any more or less money whether the dealer sells the car at sticker or below the tissue, they get the $invoice.

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Quote:
it just seems that the market would eventually correct on its own. why are dealers selling an endless supply of Es and losing money on them in SoCal, when the same cars could be sold in the NY metro area for example near MSRP?
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There are some very decent discounts to be had in the NY metro area, you just have to do some homework. As an example, I got my E320 at $600 under invoice.

KrispyK

I dunno where your is, but in the NYC tri-state area, a 545i can be had for anywhere between $1500-$3000 under MSRP. And the cars are plentiful -- you can pretty much walk in and pick one up.

KrispyK

What dealership were you able to get this at?

allenjdmb

on 04 E class cars. There was trunk money on remaining new MSO 03 E class cars, but those are well gone. You guys need to clear up your semantics. "Invoice" would be the dealer's cost, pre holdback or manufacturer's incentive. That is not the same as MSRP, monroney, Retail, or list. Yes, discounts should be somewhat availalbe considering the turmoil that the industry is in and the fact that it's atrocious weather in many parts of the country. C class coupes? Yes, just let them know what you'd like to pay. Most MB dealers wish they would just go away, never to return. C class sedans? Selling OK, especially with sport pack. 2-3 k under invoice on E class cars? Nope. 2 ish grand off MSRP? Yeah. And BTW, dealers, even the best performing, don't have 7% behind invoice in hold back. It's closer to 2% if your CSI is perfect. And you know how likely that is, considering the sorry state of Benz service and build quality these days. Hope this helps, but this is the kind of mis-information that often makes it tougher to find what is really the correct price when you're shopping.

codex57

You need to shop in California then. They do ship.

indus

KrispyK - I got mine at MB of Princeton.

allenjdmb - I am well aware of the auto-selling semantics. Last I checked, MB's holdback isn't variable, it is 3%. Don't confuse it with the BMW, which dropped the holdback all together in favor of the CSI-based incentives (which at perfect CSI amount to 3%). Backend profit consists of many other things, not just the holdback. Things like the floorplan, month-end (and other term-end) bonuses, and the like need to be taken into an account. $2K under INVOICE (or tissue) is not unheard of, I was offered a deal like that by some dealer in CA in December. In the tri-state area, the deals are not as aggressive (as per my previous post, I got $600 under invoice - or $3850 under MSRP - on an '04 E320).

KrispyK

Thanks for the information. If the dealers in California are offering $2k below invoice, and it costs about $1000 to ship it to the east, I'd say $600 below invoice in NJ is a good enough deal for me.

konigstiger

Indus, KrispyK:

Do you know that a class action lawsuit has been approved against Mercedes-Benz and its New York, New Jersey, and Connecticut area dealers? The suit has been filed on behalf of all those who purchased or leased a new Mercedes-Benz automobile in the tri-state region from 1991 through 1999. The suit alleges that the dealers conspired to fix the price of new vehicles in these areas throughout the class period. This may, or may not help with a new lease or purchase when trying to get them to match lower southern CA pricing. Nonetheless, it’s worth a shot. Also, FYI: https://mbworld.org/forums/showthrea...threadid=58720

jim256

I think the issue may well be weak:

NYTimes archive search:

"DISPLAYING FIRST 50 OF 1521 WORDS - The Justice Department has decided not to pursue a price-fixing case against a group of Mercedes-Benz dealers from New York, New Jersey and Connecticut, shutting down the investigation just as prosecutors were expected to move forward with an ... Last summer, federal prosecutors in New York had recommended indictments of... "

konigstiger

Hmm. NJ settlement agreement (3/03) shows that several dealers shared in reimbursing funds. If it were me, I would this document if nothing more than to get a "reaction". Love to see the peddlers sweat!

konigstiger

Damn, doing too many things at one time - I forgot to post the link: http://www.cmht.com/casewatch/cases/...0agreement.pdf

konigstiger

Challenged Conduct

The complaint was filed on behalf of consumers who purchased or leased new Mercedes-Benz automobiles in Mercedes-Benz's New York region (New York City and suburbs in southern New York, western Connecticut and northern New Jersey) from February 1992 through August 1999.

The defendants are: Mercedes-Benz U.S.A., the national distributor of Mercedes-Benz automobiles; each of its local dealers in the New York region; and Sheft Kahn & Co., L.L.P., Mercedes-Benz U.S.A.'s accountant.

The complaint alleged that Mercedes-Benz U.S.A. and Sheft Kahn orchestrated an information exchange among the dealers. Mercedes-Benz allegedly compiled average price and gross profit figures on both a monthly and year-to-date basis and shared the information with all of the dealers, allegedly for the purpose of policing compliance with the price fixing conspiracy.

The dealers also allegedly exchanged pricing information at meetings convened by Sheft Kahn. During the meetings, the dealers "were lectured about the importance of not competing against each other on the basis of price, and any dealer whose monthly reports indicated lower pricing and [lower] gross profit levels than the others was singled out and berated," the complaint charged.

The complaint further alleged that Mercedes-Benz "knew of and facilitated" the meetings and communicated directly with the dealers to prevent competition on price and to punish dealers who failed to comply with the price fixing conspiracy.

Moreover, the complaint charged that the defendants fraudulently concealed the conspiracy and that the plaintiffs could not have discovered it by the exercise of reasonable diligence before a New York Times article of August 1999.

nyca

based on what I see at NY area dealers, it probably has merit, too bad they dropped the case.