Approval was given by the Federal Court after Mercedes dealers lost a court case.
Mercedes-Benz's legal win over car dealers could transform the way new cars are sold in Australia
Mercedes-Benz Replacing Its Traditional Dealership Model with a Fixed-Price, Direct-to-Customer Agency Model
CurlCurl on 02/09/2023 - 11:53
Last edited 02/09/2023 - 12:10 by 1 other user
Last edited 02/09/2023 - 12:10 by 1 other user
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So now everyone get the same rubbish price no matter what? #awinforconsumers
Better than listening to someone get on with "how he manages to get x amount off because he used this trick and that trick and had previously slept with the sales rep and had a great time etc"…
Citation required for research purposes.
Who got your panties twisted? I thought this was a bargain site, not a let’s pay full freight retail and extras cause it’s easier.
Maybe Gerry should sell you a car then?
You know you can ignore people if you don’t want their advice, don’t you?
Rubbish price get adjusted based on supply and demand. You already seen that in Tesla/Merc.
I don't see a point of individual sales person getting a commission or buyer getting a deal. Perhaps when one car yard selling different branded cars.
@quog: No one’s scared to talk to each other. Regardless of you talk or press a button on website everyone should have the right price / same price.
Same with Tesla I believe
it be similar to Honda.
I prefer fixed price, not everyone good at negotiating.The Honda model that has increased prices by a ridiculous amount? How much is a Civic now? $50k?
Has not everything gone up?
Prices have increased but Honda have gone silly. Entry price for a Civic went from $39k negotiable to $47K fixed price, around 19% more.
Merc has been doing this for a while - this was for the court case that the dealers launched in response to Merc's move
It's not really a surprise to be honest as a ton of brands have moved or is moving towards this model particularly in the luxury goods space
Isn't it illegal to do this in the US?
No idea but I would doubt it given what else you can do in the US?
The US love a good system where the middle man can make good coin.
Except Tesla ?
Been in place for over a year, $tealerships are still rubbing eyes.
Honda is likely to die from it, plenty of Merc buyers could not care less.
Will Gerry sell cars soon when his now toilet line fails?
Wouldn’t be too much of a stretch, goes from selling shitters to shitboxes.
Apparently in some states it's illegal to sell direct to customer to protect existing dealerships, but since Tesla had no third party dealers to protect it didn't apply to them. But they are still banned in other states according to this undated article https://journalhow.com/why-can-tesla-sell-direct-to-consumer…
Ford claims that needing to sell through dealers costs them 2,000USD per car https://www.fool.com/investing/2022/09/30/tesla-is-right-to-…
Honda's massive jump in price is probably more the cause. I think the new civic jumped 10k starting price.
Just the legacy of having built great cars in the past is not going to save their future.
I am currently in Chennai and the sheer number of EV's sold here is staggering.
All dealers here have run out on the street to offer me free test drives in their latest EV offerings with MG being so pushy they did not even want to see my license just to talk about business.
Toyota? No EV? Tata has them ex stock, even the Merc dealers here put them outside ready to push sales.
Kia is also selling very well here since they have a local plant.
I blame all the kickstarters for this approach and their 'affordable luxury' because they 'cut out the middle man'
Tesla sold cars this way from the start, so they didn't have to face their dealers taking them to court. They never had any.
When Mercedes switched to the new sales model, Honda followed, and its sales fell 72%. But that occurred at the same time as they had limited supply of cars, and tried to move Honda upmarket in image and price to increase profitability per car, so its hard to untangle which of the factors cost it how much of its sales.
Mercedes legal problems, and Hondas sales problems made other companies hesitant to switch. But now the courts have signed off what Mercedes did as perfectly legal a few more might try it.
I think selling a base model civic for $47k is a good point of failure to start with.
It hasn't helped that ANCAP requires all vehicles to meet the same safety levels. It is harder and therefore more expensive to make a small car meet the same crash safety standards than a big car. And it makes it unprofitable to have to put the same safety equipment on a small car that customers expect to be cheaper. So you see companies discontinuing small cars, or pricing them at ridiculous levels. And the wonder why so many people are buying SUVs - they're big so its cheap to make them safe for their own occupants - and as a result vehicle weights, fuel consumption and CO2 emissions have gone up exactly when we want them to go down. Now, as if that is car manufacturers fault, not their own that that has occurred, they want to impose fleet wide emissions standards.
Now, as if that is car manufacturers fault, not their own that that has occurred, they want to impose fleet wide emissions standards.
It absolutely is partially manufacturers' faults. They circumvented American fuel efficiency standards by converting truck platforms (mainly ladder-on-frame) into SUVs. The craze caught on and they have nothing to lose pushing pumped-up hatchbacks sold with huge premiums.
It absolutely is partially manufacturers' faults
Car manufacturers aren't manipulating prices to get you to buy SUVs. They just want to build whatever they can make a profit on. They can make a profit on an SUV. And they can't make a profit on small cars, because its expensive to make them safe, and people will only buy them if they're cheap. We don't need more safety. That was yesterday's problem. It is largely solved. Today's problem is that we have a climate crisis, we need new cars to be smaller, lighter, use less fuel, and emit less CO2.
@GordonD: I think they're referring to this particular EPA loophole which allowed lazy automakers to categorise passenger cars as 'utility vehicles' rather than improve efficiency, which created the SUV body in the 70s-80s in the US.
Toyota producing over 10m cars this year but the waiting list still over 1 year for their popular models. What gives ?
People been calling Toyota downfall for lagging behind on EV rollout , but it seems there are plenty buying ICE/PHEV still.
Meh. They’ll set a price the market will bear. It’s not like Tesla aren’t making sales because it’s a direct to consumer model.
Mercedes-Benz Replacing Its Traditional Dealership Model with a Fixed-Price, Direct-to-Customer Agency Model
At first they laughed at Tesla and said they would be bankrupt……
Now the tables have turned and all the legacy OEMs are rushing to copy Teslas business model.
by selling bullshit green credits?
by selling bullshit green credits?
Yawn….. educate yourself instead of looking like a fool with comments like that.
And how !uch have tesla actually made from car sales
Zero - read their finacisl reports, and not be be foolish
@quog: LOL again, educate yourself instead of looking like a fool with comments like that. Tesla makes billions a year from car sales.
No, people were saying Tesla would go bankrupt because it was selling cars at a loss and over promising future software capabilities/regulatory changes.
Remember Musk promising that your Tesla can be a revenue generating auto-Taxi? That's a pretty bold promise made by the CEO.
With the amount of pending lawsuits and class actions, it might yet go bankrupt.Legacy OEMs wanted to direct sell in the US, but a lot of states have laws in place that require sales be directed via a third party middle man.
Tesla, not having any, went ahead and direct sold from the beginning. Leveraging its lack of dealerships to sell inter state from states that had no such requirement. Sometimes they would deliver to a mutual agreed location, sometimes it required the new owner to travel to get it.No, people were saying Tesla would go bankrupt because it was selling cars at a loss
People fail to understand the build out costs of creating a new companies. Tesla isn't just one company, its many companies it was building out. Sure it had some losses, but Ford is losing $32k USD per EV sold at the moment. LOL.
Legacy OEMs wanted to direct sell in the US
They struggled more with what to do with the exisiting dealer network they had in place than the state laws. Tesla is able to sell direct in most states. Why can't Legacy? Yep… dealer network.
Didn't realise elon had an account on ozbargain
Didn't realise elon had an account on ozbargain
Is that your best comeback to Ford losing $32k per EV….. while Tesla makes profit!
I bet you still think Tesla isn't profitable!
@JimmyF: I really beg you to read what I wrote, there are words there, And thats not the entirety of the issue.
@smalltime0: Same, I really beg you to read what I wrote. I replied to your two 'key' points. Tesla no longer sells cars at a loss, the 'loss' per vechile back then was build out costs of factories etc. Just like Ford losing $32k USD now on each EV. All that upfront overhead has to be covered somehow.
Legacy OEMs who want to do direct sales in the US can in most states, they don't as the legacy stealship network needs protecting as they still need them.
So what is your issue that I need to read?
You are wrong, Mercedes-Benz is one of the earlier supporter and investor of Tesla Motors in 2009 having more than 9% stake. Various parts of the Model S cockpit is also sourced from Mercedes.
You are wrong
LOL am I really?
Mercedes-Benz is one of the earlier supporter and investor of Tesla Motors in 2009 having more than 9% stake. Various parts of the Model S cockpit is also sourced from Mercedes
All that has nothing to do with what I said about legacy OEMs coping Teslas business model of direct to consumer after laughing at Tesla for not having a 'dealer network'.
Also Merc only put $50m in to Tesla, chicken feed really. But if Merc beleived in Tesla, why did they sell their stake in Tesla in less than 5 years? Oh right, as they thought it would go under and be worthless!
Bet they wish they kept that $50m stake hey?
https://www.ccn.com/daimlers-now-sold-tesla-stake-market-cap…
In your face Tesla:
“Mercedes-Benz is the first car maker to have a 'Level Three' semi-autonomous driving system certified in California”.
How soon to arrive in AU?Isn't Level Three considered effectively completely autonomous?
You can legally play games it says. Or do some prescribed nasal powder…
Isn't Level Three considered effectively completely autonomous?
No.
Level 5 is autonomous anywhere. You don't need a steering wheel.
Level 4 is autonomous in a defined area. You don't need a steering wheel unless you leave that area.
Level 3 is the ability to perform most ordinary tasks, but a driver still has to be supervising in case.
Level 2 is the ability to flow with the traffic. Steering. Acceleration. Braking. With the driver actively paying attention.
Level 1 is simple driver assistance like cruise control.
Level 3 is a recipe for disaster. Humans are notoriously bad at sitting still while waiting for something to happen. If L3 autonomous fails and needs supervisor assistance it’s going to a lot to get the attention of a driver who’s just been sitting there bored for the last 30’min.
@Euphemistic: No. Tesla's sub par Autopilot advertised as it is now, hiding its limitations, is the recipe.
In your face Tesla:
Look at the details its basically useless
Mercedes-Benz’s Level Three semi-autonomous driving systems to be used on highways during daylight hours, at speeds of 40mph (64km/h) or less.
So can only be engaged on highways, during the day and at under 64kmh!? Hmmmm ok that is pretty limited.
it is a 'good way' to cut out the middleman but the people rich enough to buy 'most' mercs new probably dont care that much
I always wonder where people get this notion from; what makes you think wealthy people are any less mindful of their money than those without? Indeed it often takes the right mindset to be able to obtain wealth
On the otherhand, those leasing expenaive cars when they cant afford them, sure, the extra isnt going to impact their mentality one bit, hut if youre cross shopping a Mercedes where the price has gone up three times in 18 months, or a BMW or Audi where the prices are more reasonable (comparatively) smart money will choose the other options
Not sure it's working as sales were down 5.5% in the first year of fixed pricing, compared to a market up 3%
I always wonder where people get this notion from; what makes you think wealthy people are any less mindful of their money than those without? Indeed it often takes the right mindset to be able to obtain wealth
depends on what you 'consider' rich - im not talking blokes with a house and maybe an investment property earning in the 150-250k range - a lot of people think that is 'rich' that is very much middle class in modern …..most white collar or trades ppl are at this level after 10-20 years- you are still 'working poor' unfortunately the socialist media ABC is trying to convince you have a small amount of wealth makes people rich when in truth this is how they keep you 'poor' by taxing you unfairly and expecting you to feel like you are 'lucky' opposed to a slave to a unfair system
Rich people earning over 25-30k or more a week on business or high end jobs with invest portfolios and networths excessing a couple million are the ones who buy 5-100k handbags, 1-5k shoes, 40k watches, fly 1st class or in a private jet etc these people do not care about the cost of items - if anything they more expensive something is they better as it creates an element of exclusivity to the item.
True, also unlikely to be looking at a Mercedes with that kind of money; as you say, it's not really a status symbol
@RMBC: depends on the 'merc'
CLA series where cars are around 70k
S-class where cars RRP around the 600k are not for plebs like myself
Mercs cast a 'wide net' from upper middle class to extremely wealthy - they have a large catalogue vehicles which are 'practical' and easy to drive. - dont get me wrong i like Lambos and Ferreris but even if i won 100m i probably wouldnt buy 1 becuz they are low, uncomfortable and are are two seaters
@Trying2SaveABuck: Very true, but the s class only makes up 0.8% of Mercedes Australian sales, being 263 of 33,034 from 2021's data, so not a large portion
The s class starts around $220k, and certainly, the wealthy will be looking around there, they'd also be cross shopped with large BMWs or Audis, or even the Porsche Panamera, but more likely these days, particularly at the higher end, the luxury SUVs from Bentley, Aston Martin, Lamborghini etc
Plus nearly all of the entreprenuers I know (clients mostly) like the game and having a win, haggling is part of that. Particularly the ones making the kind of money where they could buy these type of cars without any impact on their lives. Second generation wealth on the other hand seem to be happier just with the status symbol
"expensive" is a relative term, people with more bank are simply going to be less put off by higher prices
A fair point, but it also opens up many more optipns, so value and other considerations come into it
They are going to bring in the subscription model too. Want to unlock the car via the button on the keys, that would be $9.99/month.
Can't wait for others to follow. I am yet to meet an honest car salesman.
If they can't screw you with the car or options, they will with the finance. Stealerships and real estate agents - things that should not exist on this day and age.
Oh no!! Anyway…
It is only fixed price on "new" cars and selling vehicles that are from a "if you need to ask the price, you cant afford it" brand.
If the dealers had any stones, they would just say no to being a dealership and convert to another brand, but like true cucks, they will moan about it and just get on with the job of
sellinghanding over cars to customers.In the case of Honda, it's a stupid move. People who shop Honda want a bargain or are looking for a cheaper alternative than MB and they are in a segment that other manufactures allow negotiations.
I think what they need is both systems. If you want to go in and haggle, let them. If you just want a click and order experience, this too, should be offered.
Let’s open up both systems and see which one wins.
Exactly… there is no reason that car manufactures cant have both systems in place. You either buy through the manufactures website if you dont like to haggle, and it gives dealers the incentive to still drive a deal for your business if you want to go that route.
MB are just trying to be Apple of the car world by price fixing their cars. Dealers are just pissed that they wont be able to gouge customers to the same extent and that the manufacturer is going to cut into their profits.
Simple fix, the dealers are the customers of MB, if they dont like the deal MB is offering, walk away, start selling BMW's and Audi's instead. MB would have to fix their sales model if they had no more outlets to sell them from. This is part of the reason so many dealers were happy to give up Honda dealer networks. You want us to just be your delivery hub?? Yeah, no thanks. And you can see the affect this is having on Honda. Dealers drying up. Sales drying up, service centres drying up. Pretty soon, Honda will exit the Australian market and blame us for not buying their cars.
I can see that where there’s good competition it will pay brands to have showrooms etc. a car is a big purchase and many people want to sit in and drive before they end up with $50k worth of something they don’t like. Honda not having showrooms is really going to hurt because we can go next door to Toyota, Hyundai etc and actually drive their product.
Tesla has largely not had any competition until very recently. It has been the go to EV for everyone. They only have a couple of models and very few options. It’s easy to set up a website and wait for the customers to come to you. Now we are getting more options (and ok musky is really turning out to be a tool and not just eccentric) Tesla is going to have to worn harder to keep customers.
Remains to be seen wether the Benz badge is enough to make people buy without testing.
Don't Subaru also have fixed price? Not withstanding the luxury brands, most non utility cars on the road are going to be Toyota, kia or Hyundai with the Chinese brands catching up very fast. Honda and Nissan have completely lost it.
I thought we already discussed this topic time to time, it be similar to Honda.
I prefer fixed price, not everyone good at negotiating.