Real Talk: There's No Way Car Dealerships Will Survive This

Today I talk about the huge increase in the amount of negative equity that customers have in their vehicle trades and how this is forcing dealers to lower their prices!

[tag_]

I will not shed one tear or lose a single second of sleep over the prospects of dealerships going out of business. With the way they have overcharged on MSRP for certain vehicles and have taken advantage of people and find literally every way they can to screw people, I honestly HOPE and PRAY 95% of dealerships go out of business. I'd personally rather just order directly from the manufacturer anyway.

[GDTRFB]

The fact this many people were so willing to put themselves in this situation in the first place is beyond disturbing to say the least. People’s absolute stupidity, combined with predatory lending practices, is going to hurt all of us for years to come. But hey, it will continue to fall on the shoulders of the middle class. Bend over and get ready to get plowed.

[Rat-Builder]

Some dealers successfully are able to shoot themselves in the foot repeatedly. In 1985 I was going to buy a Chevy Sprint. The car (paid off) I was trading in booked at $2, 500. The Sprint was around $7, 000. We were $200 off on the deal. Credit Union financed X amount. I told them to jack the price of the new car up $200, and give me $200 more for the trade in. They said that they could not do that, so I walked out the door, after telling them that if I did in-fact walk out the door, I would not come back. This was in my home town. I went to another dealer in a town 250 miles away, (Nevada), and they were happy to make me a deal. $200, in my opinion was NOTHING!!! I am sure that there were many things that they could have done to make the "deal" go through, but they could not be bothered to do it.

Now, today, I have a 2009 Dodge Diesel 2500 pickup that is paid for. Less than 80, 000 miles on the clock. I am 75 years old, and I will never buy another pickup. They cost $75, 000 now days anyway. My daily driver is a 2002 Jeep Grand Cherokee with 217, 000 miles on it. I will keep this vehicle until I can no longer repair it. I am a retired heavy equipment mechanic, so I don't have a problem repairing that Jeep, or the Dodge either.

The Dealers have dug their own graves around here. (Idaho) The Dodge/Jeep dealer in this town will never see me for anything, and I own a Dodge and a Jeep. They lie, and did additional work that was not discussed on my Jeep. They destroyed the bearings in the rear diff taking them out to "inspect them, " and I had no choice other than buying new parts to reassemble it. For $600 they lost a customer for life, plus, I tell everyone about what they did to me!!!

So, I guess that the bottom line in this rant is that I could care less if the dealer in this town went bankrupt. I would laugh in their face.

[smarticus]

Let's not forget those dealerships played a significant role here with charging over MSRP during the shortages, etc. So it should not shock anyone that dealerships are now struggling to help their victims get out of these upside-down deals. Sometimes the chickens do come home to roost... ¯\_(ツ)_/¯

[billd]

If things get this dire, such that lenders are threatened by huge numbers of defaults, or the Big 3 are threatened by sales drying up, or even if large numbers of dealers' profits are threatened, there'll be another government bailout, just you watch, involving the words "Too big to fail."

[williamosgood]

Dealerships have been screwing over their new car customers for the past couple of years. The net result is that they have permanently removed their customer base from the market. There is no coming back from being so far underwater on their car values.

[chrisstadler]

Like I explained/predicted before, most of the little Mom & Pop used car dealerships on State Street will be gone by next Christmas. The awful reality of this inflation cycle is just beginning.

[sstjacques]

I pay cash for vehicles, but pay cash for used vehicles even though I can afford a new car in cash.. then pay cash for parts to fix them if needed and do work myself. Have not had a car loan since 1993 and never brought vehicle in for service at steelership unless it was warranty work. I feel bad for those that have negative equity, but it's you folks that are driving up these prices paying and buying your negative equity Car loans and upside down car deals.

[midlifecrisis]

Just drove down I45 between Houston and Galveston, it has a ton of new car dealerships within that stretch of highway and 95% of them were "empty", no cars on the lot for sale.

[michaelkolbe]

Really hope they get a taste of what it's like to be so broke ! Let them suffer ! Corporate greed just like many other corporations ! All they know is screwing people !

[Dntstpblvn]

The dealers who ripped off buyers making $25k profit on a vehicle above the sale price of the vehicle, deserve to go bankrupt and shut their doors permanently.

[Chief_]

Dealerships are fighting tooth and nail to keep the ADMs and full retail on used cars! 😬 most dealerships have thrown away customer good will over the past two years.

[will.davlin]

Aside from service I'd rather just buy online and get car delivered to the home anyway

[russell]

I keep telling my wife who wants to buy a car just WAIT.

[andrewb]

Dealers will get what they deserve. They let greed over volume drive how they took advantage of consumers. They artificially drive up the value of the vehicles in a way that mad the manufacturers also drive up MSRP so they could get their cut if the action.

[KPHVAC]

Don't buy all the accessories, and never pay more than MSRP! Always do a 20% to 30% down payment and you should never have this problem!! If you're upside down in a vehicle keep it until you have paid off the negative equity.

[jamesmcclure]

They should not allow people to roll warranties and added accessories into the loan. That stupid shit should be paid out of pocket. Moronic buying habits have put people in the situations they are currently in. Yes dealers are greedy, but if people are stupid enough to overpay for shit, why wouldn’t they do it. If everyone refused to overpay, dealers would be forced to lower prices to begin with. But, if you play stupid games, you win stupid prizes. Way to go people

[wanted-]

Let me see if I understand this. Many dealers in their greed to screw their customers inadvertently screwed themselves. Now that right there is funny, I don't care who you are. :)

[fattie]

I hope Dealers go out of business sooner than later.

[rcal]

I will be doing my research and absolutely will not ever buy from a dealer that charged ADM during the pandemic. I’ll be doing my part to ONLY buy from the dealers that treated people right and never went over MSRP, the greedy dealers can go to hell for screwing over so many people.