Honda Dealers Losing Their Franchise

All car companies may go the same way and set the prices.

https://www.abc.net.au/news/2021-03-19/car-dealerships-honda...

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Comments

  • +1 vote

    Yeah this has been known about for a while, Honda switching to fixed price sales

    No doubt its where the industry will go in 5-10yrs. Slowly see the bottom of the top 15 brands switch to that model, with the top brands taking their time a bit due to the number of dealers

    • +1 vote

      yep… when i went to enquire earlier this year about a new car, the guy was telling me all about it. Basically said no more bargaining on prices and the only price reduction they'll give is if you trade in they'll bump the figure up to close the sale. Don't understand why they're getting rid of the Jazz though, the Civic is getting borderline sedan size

      • +2 votes

        I've said it before but it'll be interesting to see.

        I've worked for used car yards that have a fixed price model, and people can't wrap their head around it. It's just one of those things that people are used to haggling. There's whole cultures who refuse to pay the price shown on the window. Despite proof shown that your car is the cheapest of that year/kms/condition, they just want to bargain it further down.

        Don't get me wrong, I (and many of my colleagues) are aware that fixed price sales are on the horizon, it's just that it'll be interesting seeing that mindset switch

        • +3 votes

          It seems that in this day and age nobody is prepared to pay the sticker price for anything - cars, whitegoods, etc etc

          • +1 vote

            @Ocker: It's how we're all trained, essentially. You know in certain situations you can haggle, in others you can't. You don't go to Coles, go to pay and ask them to do a better deal. It's just how we're brought up, and depends on the people around you as well as your own assertiveness.

            •  

              @spackbace: Doesn't sound like a true Ozbargainer to me…I always ask Coles to do their chooks cheaper once they have been out for a few hours. Never refused. I would do the same for a car approaching the end of its manufactured year.

          •  

            @Ocker: Exceptions.

            Property - people will pay above quote
            Bitcoin - no underlying cashflow but people will pay just because it is limited. Buying a product created by we are not sure who, there is limited quantities (lets not talk about Bitcoin gold and other forks), value is held by the fact the people will pay more fiat currency to get it but you have to cash out into worthless fiat to spend it. Or like the guy who spent bitcoin on pizzas that is worth $440m.

            • +1 vote

              @netjock: Property - is a appreciating asset. People pay above guidance value with the assumption the property will increase in value.

              •  

                @kfcfatfat:

                People pay above guidance value with the assumption the property will increase in value.

                That is just ripping yourself off isn't it? It isn't magically going to appear. I think you'll find a lot of people pay above market for "hope" rather than any guarantee.

        • +19 votes

          The flipside is there's many of us that don't want to haggle. I want to know the price of the item and then make a decision on whether I can afford it/it's suitable or not.

          I don't want to spend ages pretending to be engaged in a healthy banter negotiation when you know you're never the winner anyway. No matter how much you haggle down, dealer always wins (they're meant to, it's a business).

          Just tell me it's $50,000 flat out. No games, no bs, no hidden cards. I'll then decide if I want it or not.

          No different to most other things you buy.

          I'm completely all for it. As well as car online ordering, customisation and delivery. We have to move on.

          •  

            @Hybroid: But that's the thing, there's always been an RRP for the car. You can walk in the door, pay that, walk out again without knowing anything different.

            Some people don't realise they can negotiate finance rates, because they just don't know. So they take it, pay it, walk out the door.

            Same same

          •  

            @Hybroid: exactly, buying a car should be like buying jeans, try it on, pay, walk out with it. or a phone. tell me the price, and I'll decide,
            does that include same day delivery? I'm not waiting 3 months, no way.

          •  

            @Hybroid: Can't agree more, really hate going to a dealer and negotiate.

        •  

          I hate negotiation. When I have sold some of my cars I just said in ad im not moving on price and told anyone who offered under to jump.

          I would love this

      •  

        I doubt they're getting out of the sub-compact market, lol. The Jazz has been rebranded overseas to fit and life. Plus they have the city.

        •  

          New Jazz has been confirmed as not coming to Aus

          https://www.caradvice.com.au/898018/2021-honda-jazz-final-ed...

          The 2021 Honda Jazz Final Edition has been announced, offering buyers extra features ahead of the model's departure from Australia next year.

          Market is all about SUVs these days. Compacts don't offer them the profit margins, nor do they sell in great scale

          •  

            @spackbace:

            Market is all about SUVs these days

            Jack up a sedan, call it an SUV and people will pay more for some extra length coil overs, shock absorbers and some black plastic wheel arches.

            It doesn't take a rocket scientist to know SUV shape will always be less aero dynamic than same body lower to the ground. I guess it is more entertaining to be above to see over the sedan in front to see the SUV in front of that sedan or the back of the semi going slow up front.

            •  

              @netjock: they're useful though when you're forced to kerb by some idiot driver.

              • +3 votes

                @petry: You are forced to the curb because you are driving in someone's blind spot. Personally my front is either a meter behind their rear corner or a meter in front of front of the other driver. Never linger in someone's blind spot.

                Also you'd rather get hit than curb and potentially hit a pedestrian or cyclist. They aren't protected by 1T of metal. Asked whether my painted panels are more important or potentially a pedestrian / cyclist's life. I'd know I'd pick the latter.

                People just believe an SUV can mount the curb, you see some of the low profile tyres on these sports SUVs? They can hardly mount a small speed bump.

                SUV drivers can only dream about mounting the curb. Going off road is like going to the moon.

                •  

                  @netjock: Get some AT tyres.

                •  

                  @netjock: nope - many other reasons why you need to get the hell out of the way including those driving the wrong way, drunks, overtaking trucks etc etc.

                  •  

                    @petry:

                    wrong way

                    You would think you'd see that coming whether you drive a sedan or an SUV. It isn't like Sedan is a tram that can't swerve. As the moose test shows time and time again. Less body roll and more agile in sedans.

                    drunks

                    You'd think people are drunk already and you can see signs of behaviour. We don't have a sudden down pour of drunk people.

                    overtaking trucks etc etc.

                    Well you shouldn't overtake on the left and you shouldn't be trying to drive on a truck's blind spot.

                    If all three has happened to you and frequently I'd suggest you either move or reconsider your driving style. If people are buying SUVs based on the "potential" of the above then they must have skipped statistics

                    • -2 votes

                      @netjock: the first time i ever seen a drunk swerving across you from right to left blamed on the driver in the left hand lane - try that in a court..

                      also applies to asleep at the wheel so maybe you should also give that one a go.

                      oh and when you headon someone by crossing sides you can also claim they were driving in your blindspot in front of you….

                      a simple post and look at the accusations levelled… looks like people have an axe to grind

                      •  

                        @petry: I don't have an axe to grind. You are just paranoid that those items listed happen more often.

                        By your logic we should all be driving APCs but then doesn't stop a tank running over you because the tank driver was either drunk or going the wrong way.

                        Maybe you only fly on 4 engine planes or you just drive tanks tanks interstate.

                        • -1 vote

                          @netjock: mate you're a laugh and a half

                          telling me not to kerb for any reason because I am always going to potentially hit a cyclist even when someone's coming at me headon or drunk or asleep like its going to be my fault ….

                          you have an axe to grind

                          •  

                            @petry:

                            telling me not to kerb for any reason because I am always going to potentially hit a cyclist even when someone's coming at me headon or drunk or asleep like its going to be my fault

                            You assuming the drunk or head on is coming down a one way street with no room on left or right? Where do you live Rome, Italy? Or SOHO, London, UK?

                            You are just dreaming.

                            How many court cases you been keeping count on?

                            • -1 vote

                              @netjock: still trying to provoke?

                              from this 'they're useful though when you're forced to kerb by some idiot driver.'

                              to this

                              'You assuming the drunk or head on is coming down a one way street with no room on left or right? Where do you live Rome, Italy? Or SOHO, London, UK?

                              You are just dreaming.'

                              •  

                                @petry: Not provoking anything.

                                You are the one with provocative suggestions that people driving wrong way and drunks are regular as Friday and Saturday night drinks that you need SUV successfully curb your car, as if the modern low profile tires on SUVs can. Good luck.

                                •  

                                  @netjock: interesting reworking of 'they're useful though when you're forced to kerb by some idiot driver.'

                                  keep grinding away ….

                                  •  

                                    @petry: You just can't eat your own words. End of conversation.

                                    •  

                                      @netjock: ahh but your opinion that all suv's all have low profile tyres, and your accusation that

                                      'You are forced to the curb because you are driving in someone's blind spot. Personally my front is either a meter behind their rear corner or a meter in front of front of the other driver' regardless of the speed limit begs the question do you really know how to drive?

                                      •  

                                        @petry:

                                        regardless of the speed limit begs the question do you really know how to drive?

                                        shows you don't

                                        •  

                                          @netjock: so when they're speeding you speed, and when they are going too slow you do to?

                                          cuz according to you everyone drives at constant speeds….. cuz your 'front is either a meter behind their rear corner or a meter in front of front of the other driver' regardless of the speed limit …

                                          and not everyone's suv uses small tyres either which you'd know if you drove

                                          •  

                                            @petry: You assume I am following the same car. Oh you are such a genius. The genius that doesn't realise there is a potential fine.

                                            For such a claimed safe driver you don't understand what is a safe speed neither do you understand it is potentially dangerous to mirror another driver without regard for other users.

                                            You really should use some common sense.

                                            You are just being obtuse because you can't fathom being wrong

                                            •  

                                              @netjock: original post ' they're useful though when you're forced to kerb by some idiot driver'

                                              you think its wrong because

                                              of speed, cyclists, skinny tyres and whatever other crap you dream up …just keep on being abusive because that's all you're interested in being ….. grind away champ…

                •  

                  @netjock: I dream about not slowing for speed bumps and shit crossovers.

            •  

              @netjock: Regardless of your thoughts about SUVs, it's the market leader, and growing rapidly

          •  

            @spackbace: From memory it's because to get the ANCAP ratings, the safety features remove all the profit from small card, and people don't want to pay high prices for compacts. Personally, compacts have never looked right is AUS. In the back streets of Europe, fine. With the roads and speeds here, they look like death traps.

            •  

              @singingwolf:

              Personally, compacts have never looked right is AUS. In the back streets of Europe, fine. With the roads and speeds here, they look like death traps.

              It is the opinion of most people with zero knowledge and also done zero research. Bigger equals better is the assumption. There is large size cars with really bad crash test ratings like the Mitsubishi van (rebadged Renault).

              We also accept cars with low safety levels because "it looks good"

              Point of driving a car is not to get into accidents in the first place. It is a combinations of driver awareness (not putting yourself into harms way), skill (for when you do get into a situation) and last of all is luck. Having an extremely safe car only saves you because even with it's limited smarts it has better awareness (AEB is one example), skills (ABS) and some luck (not miss the other car but run off an embankment and car ends up in a fire ball before you can escape).

              Compact cars are not necessarily unsafe cars, look at Smart car vs Mercedes S class early 2000s

              You know from war movies the only way to survive is with a tank that is bigger than the biggest shells available and there is always bigger shells which needs bigger tanks. At some point the tank would be so heavy it just can't go anywhere.

      •  

        Jazz is a fantastic car, shame only you and I think so mate :(

    •  

      Will this head in the direction where dealers agencies might having multiple car brands.

      •  

        Most likely. You won't need large showrooms for 1 particular brand, not when most of the cars will be ordered in.

        You could have 1 model of each car on show and licensed, to be used to test drive etc. The rest you'll just have a big screen or computer to make your decision.

        •  

          That is exactly the way it i done in Tokyo, and has been for 30 odd years

  • +1 vote
    •  

      Edit

    • +1 vote

      Why are you linking to the same article which is already in the OP (and the whole thread is about)??

      •  

        added another then

  •  

    Be intersting to see how this pans out,
    I know in Melbourne there was once a massive used car dealership that introduced "No Haggle Best Price" pricing, within 6 months they had exited the consumer car market, downsized to a smaller lot and were focused only on Tradie vehicles (vans, Utes only) this Tradie car yard haggles.

    •  

      Used and new are very different markets

      •  

        As someone who worked in the industry for many years i agree… but the fundamentals are the same
        People do not want to pay sticker price plain and simple

        • +1 vote

          I just think new are easy to compare therefore its harder to differentiate. Used is harder to compare so its easier to not have a fixed price.

          Also used you do not have a manufacturer supplying the product who can tell you what to do.

  • +1 vote

    Isn't this already a thing in other countries? I remember 6 years ago when I went to the US, and my friend there ordered a X3 online with the options and just went in to do the payment + pick up the car.

    The issue here is we have a stupid import tax that makes otherwise reasonable cars super expensive, hence everyone wants to haggle, and why pay 20k+ more when you can get a BMW x5 from 120k down to 95K… if I only had to pay 65k USD for a BWM x5 plug-in hybrid I wouldn't bat an eye if its fixed price.

    • +1 vote

      Luxury brand, luxury price. 👍

      •  

        Tesla Model 3 starts at 45k AUD in the US and 66k here.

        Honda accord is like 25k USD compared to Australia 53k AUD, both entry model.

        Hopefully fixed price means its cost + Margin and done! no dealer margin.

        •  

          lol -where does it say import taxes removed?

    • +1 vote

      I actually bought our car a few years ago by emailing all the dealers in Melbourne stating what I wanted, and what was their best price. Negotiated via email with someone, paid a deposit via credit card, and then a few months later got an email saying car was reading for pick up

      I never even met the guy I was dealing with

      •  

        Used to be in the trade. This is most effective way. I tell people again and again to do this.

        •  

          Except when the majority of the salespeople are stuck up (profanity) that refuse to deal over email because they know you're hunting for a better price.

          •  

            @nurries:

            because they know you're hunting for a better price.

            Well duh lol

            There isn't a trick we haven't seen, I don't get how people feel like they're the only ones to come up with these ideas.

            •  

              @spackbace: It's not a trick. It's just people trying to reduce your extortionate prices down to something half decent. The entitlement is real.

              •  

                @nurries: Extortionate? Have a look at how much of a car's price is government taxes, then think about it

  •  

    Almost every industry has in recent times been affected by forces beyond their control. It's silly for business owners in the motor industry to think that they were somehow immune to these changes.

    •  

      You know people whinge when they've had it too good for too long and expected to be continued to be feed the same size servings plus some more.

      Bit like Bitcoin from $750 to $60k which is 80x. Even if it goes to $1m it is 16x but some people won't be happy with that.

  • +3 votes

    Another win for the weak willed negotiator.

    Consumer as a whole loses out.

    If someone doesn't want to negotiate, they are under no compulsion to now, they can just pay the price they are quoted and then stop whinging.

    Tesla are driving a sales model that exists for them due to the demand imbalance. A crappy honda jizz is not the same.

  • +2 votes

    Already having problems selling vehicles in Australia and now they want to nail the final nail into their own coffin.

    I don't know how many dealerships I have walked out of in my day where they have given me "the price IS the price… The haggling has been done for you" line. Yeah, nah.

    •  

      Yeah, nah.

      There will be a day where that happens, and you'll have to pay RRP for your Fiat 500 20th Anniversary

      •  

        Never happen. For a $3 can of beans, no need to haggle. On a $30,000+ vehicle, this would retail suicide to tell prospective customers “the price is the price”…I would sooner hit the used market in Fiat decided to do that to me…

        • +1 vote

          Never happen.

          Toyota NZ introduce 'haggle free' fixed pricing model

          Toyota dealers will not be allowed to discount new vehicles to beat their colleagues at other Toyota dealers.

          Nor will they have a stock of vehicles on their lots to sell customers, but instead Toyota will provide them with demonstrator vehicles only.

          Once a customer has decided what to buy, their vehicle will be sourced from three large Toyota hubs, in Auckland, Wellington and Christchurch.

          You've got your head in the sand if you don't think this will be the norm in 5-10 years

          •  

            @spackbace: Oh, I agree that it is coming, that part is written on the wall… but there are still a lot of people who are not going to have a bar of it. Either a majority of manufacturers have to jump on the fixed price wagon at the same time or bleed customers to companies that will still happily offer discounts.

            It’s basically telling consumers, if you don’t like our price, bad luck, go buy something cheaper if you don’t want to spend this much and that’s what a lot of people will end up doing, go shop elsewhere.

            Honda may be ahead of their time, but people will say “why bother going with a Honda if they can’t even compete with the deal I can get from the Hyundai dealer who is willing to discount…”

            People like to save thousands off new cars, so unless they are going to pass these savings onto consumers, this is going to hurt Honda in the short term.

            •  

              @pegaxs: Or no discount and people keep their car longer to make up the difference.

              Honda screwing themselves might be good for wallets and the environment.

  •  

    Searching for a discount code is going to get intense, "Honda5" would be my first guess.

    I think there might be more going on with Honda than just moving to the fixed price direct sales model though. For years now they have only brought in the Thailand built models ignoring the options out of Japan, some of which would be popular here like the hybrid CR-V and Odyssey.

    Maybe this is just a stepping stone to exiting our market.

  • +2 votes

    My heart bleeds for these 'poor' car stearships that are having their profits reined in….

    • +1 vote

      I think it's just a way of Honda getting a bigger slice of that fat profit margin pie. I would happily trade over to a "buy it now" system if they offered us the cars at the same price that they offer them to dealers, but they wont.

  • +1 vote

    Just part of the new 'do as you are told' world. They just want factory ordering, covid gave them a peek and that's the way its gonna go.

  • +2 votes

    Honda were screwed even before covid.

    Poor products poor engines poor warranty.

    We used to have two Honda CRVs that were perfect.

    Wouldnt touch Honda now.

    Remember when the Accord std and Accord Euro were top sellers?

    Where are they now?

  • +4 votes

    Honda never recovered from the GFC.
    They used to make great cars, unfortunately not anymore. I wouldn't buy one and neither would most.
    Expecting them to exit the Australian market in the not to distant future.

  • -1 vote

    Tesla sells direct.
    Tesla is the most vertically integrated car manufacturer on the planet (even got into mining minerals)
    Manufacturers that don’t switch to direct sales & EVs, like Honda, will go under

    •  

      Tesla does not mine their own resources. They might in the future, but they buy all their raw materials. (A lot of their lithium comes from PLL mines in Australia).

      Honda ditched their F1 program to build EVs, but it could be too little too late. Their current line up is extremely outdated.

  • +1 vote

    KARMA

    • +1 vote

      yep. I hate to sound like you or I are wishing ill will but these things are an effect of decades of mismanangement literally on a global level.

      Its no surprise Holden went out the way it did.

      Its no surprise Ford has effectively become the "Ranger and Mustang car company".

      Its no surprise that Mitsubishi ended up as a subsidiary of Nissan Renault.

      Its no surprise Toyota are still #1.

      Its no surprise that Hyundia Kia became the overwhelming force they have.

      It will be no surprise when the Chinese steamroller comes.

  •  

    I sort of get the fixed price model, but would trade-ins be dealt with?