New car pricing

opinion guy

I've been doing a bit of browsing the various garages etc of late and I've noticed that different garages tend to have the same new cars at the same price.

Which sets me wondering:
Who is setting these prices ? Garages or Importer/Manufacturer
Are these garages truly in competition ?
What are the laws surrounding these things ? Competition laws etc ?? Seems a bit pricey-fixey to me

R.O.R

opinion guy wrote: »

I've been doing a bit of browsing the various garages etc of late and I've noticed that different garages tend to have the same new cars at the same price.

Which sets me wondering:
Who is setting these prices ? Garages or Importer/Manufacturer
Are these garages truly in competition ?
What are the laws surrounding these things ? Competition laws etc ?? Seems a bit pricey-fixey to me

The pricing advertised on new cars is the recommended retail price, which is set by the importer / manufacturer (actually required to work out the VRT).

What a car actually sells for and what it's advertised for are two different things. If cars had to be sold at RRP then it would be price fixing, but each garage is free to sell the cars at whatever price they want.

Owen

I bought a bag of jellies last night with a price sticker of a euro on the front. Other shops sell the same jellies at the same price. Makes me wonder who's setting the price, the distributor, or the shops. Seems a bit price-fixey to me!

royston_vasey

opinion guy wrote: »

I've been doing a bit of browsing the various garages etc of late and I've noticed that different garages tend to have the same new cars at the same price.

Which sets me wondering:
Who is setting these prices ? Garages or Importer/Manufacturer
Are these garages truly in competition ?
What are the laws surrounding these things ? Competition laws etc ?? Seems a bit pricey-fixey to me

I'm not an expert on these things but it does seem that price fixing is a common practise in garages and there have been well documented incidences over the last few years.

However, it's not just confined to the car market it is consistent across all sectors and while there are supposed to be laws to protect the consumer the reality, from my perspective, seems to be that the greater the lobbying power the less important competition law.

But this comes from the top down. I recall when voting for the Maastricht Treaty the most appealing aspect of that to me at the time was the one market concept hence I voted for it. When the Treaty got passed the government was then granted exceptions such as the notorious VRT, I didn't vote for that but unlike Lisbon I wasn't given a second chance to re-consider my position.

johnb25

opinion guy wrote: »

I've been doing a bit of browsing the various garages etc of late and I've noticed that different garages tend to have the same new cars at the same price.

Which sets me wondering:
Who is setting these prices ? Garages or Importer/Manufacturer
Are these garages truly in competition ?
What are the laws surrounding these things ? Competition laws etc ?? Seems a bit pricey-fixey to me

Anything in particular you are looking at, or just window-shopping?
Been looking at deals myself, and what you can get quoted for cash is very different from the list price, which is standard.

-Chris-

royston_vasey wrote: »

I'm not an expert on these things but it does seem that price fixing is a common practise in garages and there have been well documented incidences over the last few years.

There have been a few documented cases alright, but I'd hardly say price fixing is a common practice. I've been in the industry 10 years and I've NEVER come across it.

I've nearly discussed pricing with a competitor/colleague a couple of times and by and large been shot down (rightfully).

Cookie_Monster

Why shouldn't every dealer sell a focus* at exactly the same price though. No matter which Tesco you go into to buy an own brand product it will be the same price, same thing can apply to cars. If you want a cheaper one change brand/model.

Now obviously in the real world it is not as black and white as that but you can say the principle remains the same.

*example

Big Nasty

Cookie_Monster wrote: »

Why shouldn't every dealer sell a focus* at exactly the same price though. No matter which Tesco you go into to buy an own brand product it will be the same price, same thing can apply to cars. If you want a cheaper one change brand/model.

Now obviously in the real world it is not as black and white as that but you can say the principle remains the same.

*example

One word - competition

opinion guy

So let me extend this then to second hand cars. I've seen it alledge on another thread here that dealers have a reference book for giving prices on second hand cars ?

Is this true ?
If it is true - is this anti-competitive/price fixing ?

opinion guy

-Chris- wrote: »

I've nearly discussed pricing with a competitor/colleague a couple of times and by and large been shot down (rightfully).

Wow.

jock101

You should know better? You live in Southern Ireland! Everything is controlled by Government backed Cartels! Especially cars.

Del2005

opinion guy wrote: »

So let me extend this then to second hand cars. I've seen it alledge on another thread here that dealers have a reference book for giving prices on second hand cars ?

Is this true ?
If it is true - is this anti-competitive/price fixing ?

Yes dealers have a reference book, in the UK you can buy it over the counter but here you have to be in the trade.

But I've rarely seen a car which fits the classifications perfectly so they use it as a reference and then adjust accordingly. Salespeople/dealers aren't supposed to know what every car is worth at any time so what this book does is average out sales prices for the last few months. It's more of a crib book then price fixing.

Most people when buying a car do similar by looking at car sales sites/mags and then offering less then the cheapest car.

R.O.R

jock101 wrote: »

You should know better? You live in Southern Ireland! Everything is controlled by Government backed Cartels! Especially cars.

They do??????


Sh1t, better put my tinfoil helmet back on and run to da hills :rolleyes::rolleyes:

jock101

R.O.R wrote: »

They do??????


Sh1t, better put my tinfoil helmet back on and run to da hills :rolleyes::rolleyes:

No need for that! Your cash will do! lol:D

-Chris-

opinion guy wrote: »

So let me extend this then to second hand cars. I've seen it alledge on another thread here that dealers have a reference book for giving prices on second hand cars ?

Is this true ?
If it is true - is this anti-competitive/price fixing ?

The book is a guide to second hand values compiled by a private company. Lazy salespeople will use it to put a value on a car, thorough salespeople will use it to "check their head" while taking into account their current stock situation, any competing cars on sale in the locality and any peculiarities specific to the car in front of them (if it's banana yellow, you may throw the book away).

The book is the bluntest of tools and because there's no agreement between dealers that they will all obey "the book", there's no price fixing resulting from it.

opinion guy wrote: »

Wow.

Wow what?

jock101 wrote: »

You should know better? You live in Southern Ireland! Everything is controlled by Government backed Cartels! Especially cars.

Really? Any links or evidence to support this?
(let's leave out the Citroen case, that one's been done to death).

I'm also wondering how the UK's RRPs or Germany's RRPs are any less cartel-y than ROI RRPs.

jock101

-Chris- wrote: »

The book is a guide to second hand values compiled by a private company. Lazy salespeople will use it to put a value on a car, thorough salespeople will use it to "check their head" while taking into account their current stock situation, any competing cars on sale in the locality and any peculiarities specific to the car in front of them (if it's banana yellow, you may throw the book away).

The book is the bluntest of tools and because there's no agreement between dealers that they will all obey "the book", there's no price fixing resulting from it.




Wow what?




Really? Any links or evidence to support this?
(let's leave out the Citroen case, that one's been done to death).

I'm also wondering how the UK's RRPs or Germany's RRPs are any less cartel-y than ROI RRPs.

Eh, VRT on the car and the extra's, including the safety equipment, Higher VAT rate, etc... need I go on! Just compare the price of any car in Dundalk(Eire) and 10 miles up the road in Newry(UK), and with the exchange rate out of the argument the cost down here will be far higher! Which the Car Dealers and the Eire Regime engineered to stop us from buying North of the border!

R.O.R

jock101 wrote: »

Eh, VRT on the car and the extra's, including the safety equipment, Higher VAT rate, etc... need I go on! Just compare the price of any car in Dundalk(Eire) and 10 miles up the road in Newry(UK), and with the exchange rate the cost down here will be far higher!

Do you actually have a point, or are you looking for a random VRT rant?

There are specific threads about that if you want.

-Chris-

jock101 wrote: »

Eh, VRT on the car and the extra's, including the safety equipment, Higher VAT rate, etc... need I go on!

Please do!

I don't see how any of the points above have any bearing on the question of price fixing or operation of a cartel.

jock101 wrote: »

Just compare the price of any car in Dundalk(Eire) and 10 miles up the road in Newry(UK), and with the exchange rate the cost down here will be far higher!

We've done the VRT thing a rake of times now, don't start it up again. VRT also has no bearing on price fixing or the operation of a cartel.

That's the equivalent of saying any country that charges VAT is operating a cartel.


Also, what the hell does exchange rate have to do with anything? Is this car sales cartel now part of an international currency fixing consipiracy?

jock101

-Chris- wrote: »

Please do!

I don't see how any of the points above have any bearing on the question of price fixing or operation of a cartel.





We've done the VRT thing a rake of times now, don't start it up again. VRT also has no bearing on price fixing or the operation of a cartel.

That's the equivalent of saying any country that charges VAT is operating a cartel.


Also, what the hell does exchange rate have to do with anything? Is this car sales cartel now part of an international currency fixing consipiracy?

Would you be a Car Dealer by any chance?

-Chris-

jock101 wrote: »

Would you be a Car Dealer by any chance?

Would you be a conspiracy nut by any chance?

smash

Cookie_Monster wrote: »

No matter which Tesco you go into to buy an own brand product it will be the same price, same thing can apply to cars.

For your point to stand up you should really be comparing Tesco to Superquinn or something. But you can't do that because they're different prices in each shop. Much in the way garages are all separate shops - so they should really have different prices to compete!

Here's some Citroen price fixing http://archives.tcm.ie/businesspost/2009/03/08/story40133.asp and if you google you'll find more. There was even a prime time investigation on it a few years ago.

opinion guy

-Chris- wrote: »

There have been a few documented cases alright, but I'd hardly say price fixing is a common practice. I've been in the industry 10 years and I've NEVER come across it.

I've nearly discussed pricing with a competitor/colleague a couple of times and by and large been shot down (rightfully).

-Chris- wrote: »

(if it's banana yellow, you may throw the book away).

Wow what?

Ok forgive me in advance if I've understood this wrong but the bit that I wowed reads like you were interested in price-fixing but no-one would join you and now you know it was wrong. Am I misunderstanding this ?

jock101 wrote: »

Which the Car Dealers and the Eire Regime engineered to stop us from buying North of the border!

Ok I hate the VRT as much as the next guy but I really don't see that there is any conspiracy to buy up North as you imply here. In fact there is still alot of money to be saved by going up there eve with the current exchange rate so really not following you at all.

-Chris-

jock101 wrote: »

Would you be a Car Dealer by any chance?

And to answer the question, I'm in the motor industry. I'm giving my experience in the car industry to explain where and how dealers arrive at prices. Hopefully this information helps (in the context of the rest of the answers on the thread) to answers the original question regarding whether cartels are in operation and whether using "the book" can be considered price fixing.

I'm trying to provide any responses in a pragmatic and honest manner.


What are your bona fides for your opinions on this thread?

opinion guy

double post

opinion guy

steve06 wrote: »

For your point to stand up you should really be comparing Tesco to Superquinn or something. But you can't do that because they're different prices in each shop. Much in the way garages are all separate shops - so they should really have different prices to compete!

See thou - this is a thing too. I as told by a uk dealer that brand XXX aimed to have only one dealership in Ireland with many outlets so as to avoid competing against itself. If every XXX dealer belongs to the same company then they can all set the same prices and it isn't price fixing technically. But it kinda is thou. Or not. Depends on how you look at it really.

jock101

The point is the price of Vehicles in this state are not fairly priced compared to other EU member states. A captive market which suits Dealerships and Government a like!

smash

@opinion guy - but they're not all owned by the same people so it is price fixing.

To be fair, I blame the revenue for this because they demand an OMSP from the distributor for VRT reasons, the distributor must then relay the price to the dealer.

-Chris-

opinion guy wrote: »

Ok forgive me in advance if I've understood this wrong but the bit that I wowed reads like you were interested in price-fixing but no-one would join you and now you know it was wrong. Am I misunderstanding this ?

I think I may have misphrased in my post, I'll clarify.

I have many friends in the motor industry, a lot of them in sales. There have been times that I've found out that a customer who's pricing with me is also pricing with one of my friends on a like-for-like basis.

I would never call my mate and ask them about their pricing, and if they called me I wouldn't give them my pricing.


Every now and again over a pint in the pub you might say "remember that crazy aul wan who was looking to buy the pink Polo, did she ever buy that from you? I never saw her again. What deal did you give her?"

Whether this is price fixing or not, I don't know. I do know that if the deal was still "live" that neither of us would either ask or answer that question, or you might have that "oops" moment where you ask the question and your mate says "she hasn't bought from me yet, I'm not telling you that!".


It was made very clear to me on my first day in car sales that discussing pricing with competitors was a fireable offence.

opinion guy

steve06 wrote: »

@opinion guy - but they're not yet all owned by the same people so it is price fixing.

Fixed that for you. Curious what the trade members on here have to think about this one actually.

To be fair, I blame the revenue for this because they demand an OMSP from the distributor for VRT reasons, the distributor must then relay the price to the dealer.

Yeah I kind of agree with you on this one. If you put an OMSP on a car its gonna encourage a certain price range.

jock101

Anyway, Your still better off buying a new car North of the Border in the UK, even though you have to pay the VRT to register it back here. Especially if its a luxury brand. As UK dealers tend to have great promo's and extra's as standard. IMO:mad: and the experience's of friends and family.

-Chris-

jock101 wrote: »

The point is the price of Vehicles in this state are not fairly priced compared to other EU member states. A captive market which suits Dealerships and Government a like!

Well then you're posting in the wrong thread, this isn't a thread about importing/exporting of cars. There's a VRT Megathread somewhere where all this is being hashed out.

jock101

steve06 wrote: »

@opinion guy - but they're not all owned by the same people so it is price fixing.

To be fair, I blame the revenue for this because they demand an OMSP from the distributor for VRT reasons, the distributor must then relay the price to the dealer.

Yes I agree, but its no skin of the Dealerships noses. Captive market and most people will end up buying here to save the Revenue VRT hassle, especially if they live deep south like Cork etc...

R.O.R

jock101 wrote: »

The point is the price of Vehicles in this state are not fairly priced compared to other EU member states. A captive market which suits Dealerships and Government a like!

BMW 520d SE AUTO (F10) - 740,307DKR (approx €99,515.01) - Denamark

BMW 520d SE AUTO (F10) - €43,964 - ROI

Seems pretty reasonable to me.

jock101

-Chris- wrote: »

Well then you're posting in the wrong thread, this isn't a thread about importing/exporting of cars. There's a VRT Megathread somewhere where all this is being hashed out.

Yes I know, But it has a massive barring on prices and Competitiveness.

I just want to pay a fair price like what the other EU states do!:(

smash

Where's Denamark?

-Chris-

Found it: http://www.boards.ie/vbulletin/showthread.php?threadid=2055892831

Please, no more discussion of VRT or UK vs Ireland pricing please

R.O.R

jock101 wrote: »

Yes I know, But it has a massive barring on prices and Competitiveness.

I just want to pay a fair price like what the other EU states do!:(

See post above this one of yours.

You sound like a bloody broken record with every single post being a VRT rant.

jock101

R.O.R wrote: »

BMW 520d SE AUTO (F10) - 740,307DKR (approx €99,515.01) - Denamark

BMW 520d SE AUTO (F10) - €43,964 - ROI

Seems pretty reasonable to me.

Well the Nordic states have massive tax rates, but far more equil and fair societies. But thats another story.

Compare Southern Irish prices with UK, German, French prices etc... excluding VRT, but including VAT and the opposite is true.
I want to be able to buy in Poland if I want to, and not have to pay VRT. Just VAT, and the Irish Dealerships are happy for the state to impose VRT to make it less attractive to buy from other EU dealerships.

jock101

Bottom line is were being ripped off by the Cartel of Dealerships here!:rolleyes: VRT or No VRT, lol:D

R.O.R

jock101 wrote: »

Bottom line is were being ripped off by the Cartel of Dealerships here!:rolleyes: VRT or No VRT, lol:D

Would you ever give it a rest. You obviously haven't the foggiest what you are talking about so why not leave it before you embarass yourself further?

opinion guy

-Chris- wrote: »

I think I may have misphrased in my post, I'll clarify.

I have many friends in the motor industry, a lot of them in sales. There have been times that I've found out that a customer who's pricing with me is also pricing with one of my friends on a like-for-like basis.

I would never call my mate and ask them about their pricing, and if they called me I wouldn't give them my pricing.


Every now and again over a pint in the pub you might say "remember that crazy aul wan who was looking to buy the pink Polo, did she ever buy that from you? I never saw her again. What deal did you give her?"

Whether this is price fixing or not, I don't know. I do know that if the deal was still "live" that neither of us would either ask or answer that question, or you might have that "oops" moment where you ask the question and your mate says "she hasn't bought from me yet, I'm not telling you that!".


It was made very clear to me on my first day in car sales that discussing pricing with competitors was a fireable offence.

Oh I understand now. Humble apologies Chris my mistake!

opinion guy

R.O.R wrote: »

BMW 520d SE AUTO (F10) - 740,307DKR (approx €99,515.01) - Denamark

BMW 520d SE AUTO (F10) - €43,964 - ROI

Seems pretty reasonable to me.

UK list price £28,045
Minus Uk Vat = £23,868
Euro converison at todays rate (1.195) = 28,522EUR
+ VRT = 35,049EUR

EDIT - oops forget VAT = 23868 x 20% = 4774

Total cost to import = 39,822 EUR

So we are also getting ripped off. Just not as much as the Danes (poor Danes)

But this is not the place for this discussion.

R.O.R

opinion guy wrote: »

UK list price £28,045
Minus Uk Vat = £23,868
Euro converison at todays rate (1.195) = 28,522EUR
+ VRT = Total import price = 35,049EUR

So we are also getting ripped off. Just not as much as the Danes (poor Danes)

But this is not the place for this discussion.

As you said, it's not the place for discussion - but you've missed about €5,000 of ROI VAT in your calculation.

-Chris-

opinion guy wrote: »

But this is not the place for this discussion.

Bingo, and next person who "just can't help themselves" gets a few days off...