Price negotiations

[chtucker]

There is a lot Grenadiers sitting at Elliot Bay Motors- Has anyone negotiated off of sticker?

 

[snowball]

Are they sitting, or sold and waiting for the buyer's to pick them up? The ineos business model can be deceptive.

 

[anand]

With the upcoming massive ad campaign/budget, I feel like the demand will quickly rise on these vehicles and any units in stock will be moving quickly.

as @snowball pointed out, although we're probably approaching the end of the run, many in stock units at dealers are orders that haven't been picked up vs. those who have walked away.

 

[chtucker]

There had to be 75 plus, my abandoned order from March hasn’t sold yet

 

[DoubleDoom]

75+ sounds a lot but given the distance covered by each dealer, that may not actually be a large number. Especially if the gap between shipments is quite long.

 

[ecohen2]

I think your odds of getting a discount on a Grenadier is going for a <1500 mile used one. You are more likely to find an individual willing to take a loss than the dealer...

 

[Roach]

there might be some arrangement between ineos and the dealers (US) that have them hogtied. One dealer I spoke to said that most of the people coming in the showroom are there because they have a car (different brand) being serviced and are killing time. This dealer had several ready to go but little interest. Inventory building, end of the cycle yet dealer unwilling to negotiate. Maybe one of the dealers that follow the board can comment.

 

[bikesandguitars]

The only incentive being offered in the U.S. is on aftermarket parts and accessories. There are no discounts on new models and, in fact, there is a scheduled price increase on 2025 models.

 

[bikesandguitars]

there might be some arrangement between ineos and the dealers (US) that have them hogtied. One dealer I spoke to said that most of the people coming in the showroom are there because they have a car (different brand) being serviced and are killing time. This dealer had several ready to go but little interest. Inventory building, end of the cycle yet dealer unwilling to negotiate. Maybe one of the dealers that follow the board can comment.

There is definitely a contractual agreement that dealers follow Ineos pricing, which includes no market based adjustments. Everyone pays sticker in the U.S.

 

[anand]

There is definitely a contractual agreement that dealers follow Ineos pricing, which includes no market based adjustments. Everyone pays sticker in the U.S.

Ineos has said that they can't actually enforce dealers to sell at MSRP in the US; in fact for most of last year the reply from IA was that while the reservation sales would be at MSRP, after that it would be up to the dealer to react with the market

 

[anand]

The only incentive being offered in the U.S. is on aftermarket parts and accessories. There are no discounts on new models and, in fact, there is a scheduled price increase on 2025 models.

They are running 2.9% for 60 months currently as well, until the end of July

 

[ADVAW8S]

They are running 2.9% for 60 months currently as well, until the end of July

You are seeing similar financing deals coming from other manufacturers. I say keep ot rolling until the end of year so I can get jn on it.

 

[Roach]

US dealers lack the ability for conceptual thinking. Dealerships, many owned by “old” families, are one of those things that we (the US) have been hanging on to like the vinyl record industry or celluloid film. I’m not anti dealer but I’m anti dealer process. Would like to see a new approach that combined “direct” with the dealer model, like a co-op…buy a car from an Ineos co-op and you become a fractional owner with benefits. Builds loyalty, Ineos now gets real data, and can be a club house of sorts. Just a thought.

 

[Zimm]

The only incentive being offered in the U.S. is on aftermarket parts and accessories. There are no discounts on new models and, in fact, there is a scheduled price increase on 2025 models.

I got 2.9% from the dealer. That's a nice chunk in interest, and it keeps Ineos from cutting the price, starting a deflationary spiral where people wait, showing losses in the model year, killing resale, bad press, etc. You may be waiting until later winter for them to dump '24's. In which case it may the ones inexplicably ordered sans lockers. As much as I like the truck with lockers, I would hate it without.

 

[singlefin]

I got 2.9% from the dealer. That's a nice chunk in interest, and it keeps Ineos from cutting the price, starting a deflationary spiral where people wait, showing losses in the model year, killing resale, bad press, etc. You may be waiting until later winter for them to dump '24's. In which case it may the ones inexplicably ordered sans lockers. As much as I like the truck with lockers, I would hate it without.

Wait, did you finally pull the trigger?

 

[Zimm]

Wait, did you finally pull the trigger?

Yea... and at 500 miles my drivers side door handle is so jacked, the window wont go down all the way, the door wont latch unless its up, it unlatches if unlocked and you lower the window as far as it can go, once locked, it can't be opened from the outside... yea... I bought it alright... waiting on word for shipping it back for repairs. That's not just an inconvenience, its a life safety issue.

Although, had I taken it March, I'd have these issue for a few hundred more a month... always look at the bright side!

 

[LeeroyJ]

There is definitely a contractual agreement that dealers follow Ineos pricing, which includes no market based adjustments. Everyone pays sticker in the U.S.

Are you sure about this? I haven't heard from any of the dealers about their arrangements with Ineos yet.

I don't know who "owns" the vehicles in the dealer lots. Since Ineos doesn't have a large laydown/storage lot in the US, they may have negotiated with the dealers that Ineos maintains ownership of the vehicles until they are actually sold (just guessing). So if that's the case, the dealers are just acting as a warehouse for Ineos and those unsold units don't really cost the dealers anything (other than parking lot space). In that case they don't have the same financial pressure to get rid of inventory that a traditional dealer might have. But again that is pure speculation on my part.

Interestingly (to me), I thought that manufacturers putting limitations on what price a dealer can sell a vehicle for were against anti-trust laws (because there are tons of forum posts where internet experts tell you that), but at least on a Federal level, that is not actually the case. This FTC article says in relevant part:

"If a manufacturer, on its own, adopts a policy regarding a desired level of prices, the law allows the manufacturer to deal only with retailers who agree to that policy. A manufacturer also may stop dealing with a retailer that does not follow its resale price policy. That is, a manufacturer can implement a dealer policy on a "take it or leave it" basis.

Limitations on how or where a dealer may sell a product (that is, customer or territory restrictions) are generally legal — if they are imposed by a manufacturer acting on its own. These agreements may result in better sales efforts and service in the dealer's assigned area, and, as a result, more competition with other brands."

It seems though that some states might have laws that prohibit this.

 

[chtucker]

Did the deal.. picked up my own abandoned order from March/April. Couple of glitches (stained cargo area) and spare tire rattle... and it needs to go back for seat covers/side runners..

Wife is very happy, I am happy, pretty good outcome.

 

[Zimm]

Its a franchise so either they own them or they floor planned them. As for pricing, I believe most of these cars were pre-orders with agreed upon pricing. You're gonna have a real tough time proving collusion when it's not in any dealers best interest to cut pricing when per-ordered cars without money down haven't been delivered yet. It would be suicide as soon as the word got out to the undelivered orders, as they all balked for a better price.

You have 6 more days of 2.9%. Put the min down, and place the rest in an index at 15% and be ahead. They are paying you to finance the car. Take it if you want it.

 

[bikesandguitars]

Are you sure about this? I haven't heard from any of the dealers about their arrangements with Ineos yet.

I don't know who "owns" the vehicles in the dealer lots. Since Ineos doesn't have a large laydown/storage lot in the US, they may have negotiated with the dealers that Ineos maintains ownership of the vehicles until they are actually sold (just guessing). So if that's the case, the dealers are just acting as a warehouse for Ineos and those unsold units don't really cost the dealers anything (other than parking lot space). In that case they don't have the same financial pressure to get rid of inventory that a traditional dealer might have. But again that is pure speculation on my part.

Interestingly (to me), I thought that manufacturers putting limitations on what price a dealer can sell a vehicle for were against anti-trust laws (because there are tons of forum posts where internet experts tell you that), but at least on a Federal level, that is not actually the case. This FTC article says in relevant part:

"If a manufacturer, on its own, adopts a policy regarding a desired level of prices, the law allows the manufacturer to deal only with retailers who agree to that policy. A manufacturer also may stop dealing with a retailer that does not follow its resale price policy. That is, a manufacturer can implement a dealer policy on a "take it or leave it" basis.

Limitations on how or where a dealer may sell a product (that is, customer or territory restrictions) are generally legal — if they are imposed by a manufacturer acting on its own. These agreements may result in better sales efforts and service in the dealer's assigned area, and, as a result, more competition with other brands."

It seems though that some states might have laws that prohibit this.

Manufacturers are certainly allowed to enforce MSRP or franchise pricing and have several ways to address dealers that violate MSRP. They can limit allocations or even cancel franchise agreements. Granted, there are different rules in different states for minimum advertised pricing, market adjustment, offered pricing, etc., but there are no restrictions in any state on “everyone pays the exact same price”.

As for how payments work, I don’t know the specifics of the Ineos franchise but, generally speaking, the dealer agreement guarantees a certain number of allocations from the manufacturer each defined period in exchange for immediate payment from the dealer. Most manufacturers require payment be made upon receipt of the vehicle. That does not mean that a dealer writes a check to the manufacturer. Usually, there is a financing arm in place that allows the dealer to take delivery and the manufacturer to get paid with very little cash outlay by the dealer - and immediate payment made to the manufacturer.

Arguably, the greatest benefit of the franchised dealer system is in the steady flow of inventory to the dealer. If you’ll recall the crazy demand for used cars during the pandemic and the astronomical prices dealers were paying, it’s easy to understand how important a steady flow of inventory is to the dealer.

Finally, don’t expect any dealers to freely disclose the terms of their seller agreements with any manufacturer. There are strict NDA’s in place long before any franchise agreement is offered. I doubt you’re going to hear from any dealers about their agreement with Ineos.