Post by jeffolie on Dec 16, 2011 15:03:19 GMT -6
TrueCar: dealers' willing to sell prices angers Honda
================================================
Honda has told its dealers that it won't give them advertising allowances if they offer vehicles below invoice on TrueCar.com.
"... on TrueCar, the price at which dealers are willing to sell cars is transparent to all who visit the site.
The TrueCar system also is used by several large auto shopping referral services, including those operated by Consumer Reports and USAA, which provides financial services to members of the U.S. military.
Part of the appeal of shopping the online service is that it features a number of dealers who offer guaranteed pricing near or even below a vehicle's invoice, which many consumers believe represents the price the dealer paid for the auto. But because of various back-end allowances and payments, the dealer cost of a vehicle can be 5% or more below the invoice, according to auto industry executives.
"... TrueCar, which with 300 workers has almost doubled employment this year, will collect about $100 million in revenue in 2011. Dealers pay TrueCar $299 per new car and $399 per used car sold.
The online service is taking advantage of people's distaste for car price negotiations by offering upfront pricing, one expert said.
".... About 4 out of 5 shoppers now go to the Internet and seek out some sort of information about the autos they are interested in, including price data, Walker said.
TrueCar "provides consumers with a decent amount of information," Walker said. "Just by going to the site you are given the details about which dealership has the model you are looking for and the price, and that's probably a more acceptable model for many consumers."
But Walker cautioned that many shoppers remain wary of providing any personal information — either to the TrueCar system or other sales referral sites — out of fear that they will face a deluge of emails and phone calls from pesky car sales representatives. So some consumers will still be wary.
www.latimes.com/business/autos/la-fi-autos-honda-dealers-20111216,0,4913073,full.story
================================================
Honda has told its dealers that it won't give them advertising allowances if they offer vehicles below invoice on TrueCar.com.
"... on TrueCar, the price at which dealers are willing to sell cars is transparent to all who visit the site.
The TrueCar system also is used by several large auto shopping referral services, including those operated by Consumer Reports and USAA, which provides financial services to members of the U.S. military.
Part of the appeal of shopping the online service is that it features a number of dealers who offer guaranteed pricing near or even below a vehicle's invoice, which many consumers believe represents the price the dealer paid for the auto. But because of various back-end allowances and payments, the dealer cost of a vehicle can be 5% or more below the invoice, according to auto industry executives.
"... TrueCar, which with 300 workers has almost doubled employment this year, will collect about $100 million in revenue in 2011. Dealers pay TrueCar $299 per new car and $399 per used car sold.
The online service is taking advantage of people's distaste for car price negotiations by offering upfront pricing, one expert said.
".... About 4 out of 5 shoppers now go to the Internet and seek out some sort of information about the autos they are interested in, including price data, Walker said.
TrueCar "provides consumers with a decent amount of information," Walker said. "Just by going to the site you are given the details about which dealership has the model you are looking for and the price, and that's probably a more acceptable model for many consumers."
But Walker cautioned that many shoppers remain wary of providing any personal information — either to the TrueCar system or other sales referral sites — out of fear that they will face a deluge of emails and phone calls from pesky car sales representatives. So some consumers will still be wary.
www.latimes.com/business/autos/la-fi-autos-honda-dealers-20111216,0,4913073,full.story