vplaza

but last I checked, Ikea had tons of inventory that they try to move, sometimes with sales. Of course, there aren't really any "salespeople" to haggle with.

But I would have to wonder how a "showroom" would be able to make any money at all if all they did was have cars that people would test drive but not buy from them. Sounds like they'd need to be heavily subsidized by the manufacturer or actually be owned by the manufacturer.

And I don't know about others, but I do want to see the exact car that I'll buy before I buy it. Just like I probably wouldn't buy a house, major piece of furniture, or other large purchases without actually seeing and touching it. But maybe that's just me.

TheWalrus

And yes, my goal would be to have the manufacturers buy out the dealership effectively getting rid of the middle men. There would be no subsidy, rather direct ownership. I believe (though not certain) that Apple owns its stores. Those are not franchises like McDonalds.

As for me, I've never had the luxury of seeing the exact car I buy before buying it. Because I drive manual and most dealerships won't carry manuals, it has never worked out that way.

I agree with you on a house, only because every house is unique. As for furniture, I've purchased ~$3K items of furniture over the internet without hesitation (www.dwr.com for example). But then I used to work for Amazon and am very comfortable with e-commerce. Ordering from www.audiusa.com would be a lot like ordering from www.dell.com. Businesses place orders of >$50K every day with the goods sight unseen.

Maybe it's just a timing thing, but I think my perspective and general comfort level will become more common, not less, in the next 5-10 years.

SFV A4

He/she doesn't need to custom order things nor does he/she want to buy site unseen. Most people who buy cars walk into a dealership, spot a car and color they like, take it for a test drive, become excited or turned off by it, and make their decision to buy or walk away. The process listed by the OP is nice, but it caters to a small % of the buying population. Dealers are the way they are because buyers are ignorant and usually end up paying more than they should. If everyone was loaded with the facts like we are here, dealers would get choked out and the ordering idea would work.

bpp

well, almost direct...
Besides, the 'sales force' is the last place for info on upcoming models. AW is 'the' best information source you'll find or need.

markcincinnati

Well, that WAS the claim made by Philip Evans and Thomas S. Wurster in their book "Blown to Bits," 1999.

I drank the Kool-Aid when I first read the book in 2000. I bought copies of the book and gave it out as Christmas presents.

Much of what they claim does appear to be true -- the Internet has "deconstructed" almost everything -- perhaps save for auto retailing.

For the reasons sited up and down this discussion (in favor of Blowing Auto Retailing to Bits) it certainly seems a reasonable and virtually irrefutable argument.

Yet, car dealers nearly 10 years after the book's "sitting ducks" assertion, soldier on.

The Internet seems to be the place for research and some folks do buy cars from the Internet salesperson of their local (or regional) fill-in-the-blank car brand. Overall, however, folks still go to the dealership, test drive the car they want, attempt to negotiate a deal and then buy or not buy.

The lunatic fringe (takes one to know one) here on AW represents, I would guess, an insignificant buying group, in the overall scheme of things.

If we COULD (or would) actually put our money where our opinions are, well THAT might blow them to bits.

I always order my cars -- but if I could find what I wanted on the lot at the time I was ready, I would not turn it down in favor of ordering and waiting. It just never seems to work out that way -- they "never" have the car I want in stock.

The same is true for BMW and Infiniti and on and on and on. Sometimes it is possible to find what you want if you are willing to take things (options or packages) that you don't want or in colors you don't want.

Other than "you guys" and my wife, I don't know anyone who orders their cars -- well, perhaps using the "dealer locator" to search for something within 300 miles would be "sort of" ordering.

So, read the book, nod your heads that "Car dealers are Sitting Ducks," and then wake up to the current reality -- we are still buying from a three tier system. It shows little indication of a sea change -- at least as far as I can tell.

Ordering a car is anti-American, anti-instant gratification. Most folks think doing that is for rich folks or rare cars or something that I certainly don't understand. Ordering is like getting a new car twice in 6 months, generally gets you a lower price and always gets you exactly what you order (BARRING an order screw up.)

We get the salespeople because we (apparently) need and want them. And, overall, I have few complaints with this system. But then again, my expectations are that the salespeople are sales people not car people, automatically. If you find a car person selling cars, you may or may not be actually working with a great sales person.

My sales people are adequately product aware -- that means they meet my expectations. My sales people know MORE than the majority of their customers. The fact that I know more makes me the minority.

Drive it like you live.

TheWalrus

Why can't I buy directly from Audi? If I know what I want and know more than the salesperson, then the salesperson doesn't really add any value. Why should I pay them? It's sort of a self-fulfilling prophecy the way it's currently structured. "No one" wants to custom order, because that's just not how it's set up.

*If* we had the option of going direct, bypassing the three-tier system, and saving money, you bet people would come around. Imagine telling your friends, "I just saved $2,000 on my new A4 by buying online." People would turn to the web in droves to save a buck.

The reason this hasn't happened is legal and political. Consumers adapt, especially when a few thousand dollars are on the line. No, the issue is that the manufacturers agreed not to bypass the dealerships in the contracts they signed with the dealers. No dealer would build a beautiful new building, build a reputation, build a business if they feared the manufacturer would bypass them a moment later. This made sense 60 years ago when going direct meant mail-order catalogs, but unfortunately it's holding this industry back. In an increasingly competitive industry, ever dollar counts. Eventually someone will attempt to realize the savings trapped in the bloated supply chain. This is less of an issue for Audi at the moment due to the demand for their products, but look at the Big 3. Look at how much inventory is on your local GM lot. That's really expensive as it all sits out there in the sun depreciating waiting for the "end of season blowout sale".

1990V85speed

First, automakers want no part of dealing directly with the buying public. One of my first questions to a senior AoA exec, when I was in the business, was to ask why Audi doesn't own its own stores. That was the answer I received from him.

Second, in Germany, you walk into a store and drive one of the few cars on the lot, then sit down with a sales person to custom order your car at list price - no discounts or negotiating. The system has worked great for years. Not sure if we could ever convert to a system like that here in the US. Saturn has tried.

Third, like most products that we buy here in the US, that don't let you negoiate on price, we just wait for a sale to buy the product if we dont' want to pay full price. Not sure if Audi dealers in Germany ever have sales. Anyone here know if they do?

Finally, the way we buy cars, here in the US, has been around longer than most of us here on this forum. Is it perfect? No! Will it change in the future? Yes, but probably not as much as we would like, so we deal with it as best as we can. If you're a good negotiator, or can wait for a sale, then you'll probably get a good deal.

CanuckRS4

salespeople/dealerships would be feasible. The mass public are still sheep when it comes to purchasing vehicles, they rely on the advice from these salespeople.
We all still need a place to look at/touch/drive the vehicles in question.
I think the most obvious first step would be the OPTION of ordering directly from the manufacturer if you know exactly what you want to buy. You would save money because part of the contract is that you just pick up the vehicle from an authorized "local" Audi delivery centre which is different from a dealership. Perhaps have one per state/province here in N/A.
Anyways, just a few thoughts on the issue, i'm sure there are many ways of looking at this.

vplaza

financial than political or legal.

Manufacturers have no interest in owning their own dealerships or showrooms. Why should they bear those costs if there are others who would? And if all they had were "showrooms", those would be cost centers and not profit centers, so again, why would they pay for them? If they did, I'd guess the prices of the cars would have to go up, negating any savings that one might think you'd get without dealerships.

IMHO, cars are not like TVs, furniture, or appliances that most people will buy sight unseen.

vplaza

but Apple Stores have what, maybe a few tens of thousands of dollars worth of items on display? A manufacturer showroom from Audi would need to have hundreds of thousands of dollars worth of items on display if they wanted to provide a decent representation of their product line (which they would have to do if they hope to sell cars to people who need to see what they would be buying).

I just can't see manufacturers taking the financial risk of doing away with the many outlets they have today and replacing them with their own showrooms in hopes that people would simply order cars directly from them once the dealerships are gone.