New MB pricing

[stubax]

I bought my new GLB in August from a local dealer with a discount, looked online at current prices, not only is there no discount now there is also a price rise of £2000 on RRP! And they think this is god move, might be for them, suppose most won't be bothered as most cars will be on PCP. ☹

 

[Bobby Dazzler]

I bought my new GLB in August from a local dealer with a discount, looked online at current prices, not only is there no discount now there is also a price rise of £2000 on RRP! And they think this is god move, might be for them, suppose most won't be bothered as most cars will be on PCP. ☹

The fullness of time will confirm. Mercedes have already adopted the agency sales model in other markets and other manufacturers are following suit, so expect to see more the same from other brands.

 

[liamt]

I believe BMW have already adopted the agency model. Mercedes have a target to have 35% of their sales completed online by 2025 and the agency model facilitates this due to the fixed pricing. As Bobby Dazzler says time will tell. New Mercedes are commanding a premium at the moment due to limited stock, as long as they can sell cars at a premium then they will. As stock/availability starts to normalise then I would expect Mercedes to start softening the prices of cars, otherwise they are going to be left with stock that they can't shift.

 

[mioba]

Price fixing is a dangerous word. Franchisee are independent business - same prices is collusion surely.

 

[liamt]

Price fixing is a dangerous word. Franchisee are independent business - same prices is collusion surely.

Franchise dealers no longer own the new cars sat in their showrooms, Mercedes do. All vehicle stock is held by Mercedes who centrally control the prices, franchise dealerships purely act as an agency to assist customers with the purchase and delivery of new vehicles for which they receive a commission, they have no say in the pricing of new cars so they can't be colluding with Mercedes.

If anything the agency model is 'supposed' to bring transparency to the market as it is now a level playing field between the franchise dealers as the competition element regarding the price of new cars has been removed. It is also hoped that the residuals on used vehicles will hold up better due discounting being removed . Time will tell whether the model is successful, it is difficult to say at the moment given the current state of the new car market.

 

[Red C220]

It actually makes it all more simple and transparent.

If it works it will be a good thing as it will likely increase the residual values of used cars. Also I would hope to see a return of equity on PCP deals at full term rather than the negative sitatuation that occured due to finance and deposit support as part of many deals.

The previous free for all wild west discount style wasn't healthy, it was about shifting volume and making little, zero or even sometimes negative margins on the unit and making money only on the finance. The issue is it's closing the stable door after the horse has bolted, so it will be interesting to see if the model works.

Technically it's not price fixing or market fixing as you would have collude with other manufacturers of the same product. No one else makes MB's so it's MB saying - this is the price, buy it or don't buy it.

Realistically it's a return to the 80's and 90's when you'd buy a new 190, you might get the odd option thrown in of you were a regular customer, but you paid full list. The car was still worth 70% of new price at 2-3 years old.........where's the downside? If you're a cash buyer it's likely to retain more value. If you're a PCP buyer it's likely to have a higher GFV and create equity at the end of the term.

It's this deprecition situation that lead me to buying an FF (well it was one of the factors). The alternative I was looking at was an Alpina B5 Touring.....they were pretty much the same price if I bought the Aplina new...sure I'd get manufacturers warranty....but then I did with the FF anyway. The difference being one of the £120K cars was likely to be worth £50k-£60K at 3 years old and the other wasn't.. repair costs? I bought a manufacturer warranty to insure against catastrophic repairs.

Don't assume it's bad, it might actually make £120k E63's viable to buy new as you won't be taking a huge bath the moment you drive it out the showroom.

 

[Germgh0st]

This is the reason that my next car will not be a Mercedes. Not only have their prices rocketed but they've taken on their 'one car one price' policy.

BMW, as far as I'm aware, have not taken this agency approach as yet - weekend before last I negotiated a £7.2k discount on a new M340i, so their dealers are still allowed to work with the price. My choice was £72k for a new C43 or £58k (after discount) for a new M340i which is pretty much an equivalent car in terms of spec and as a bonus retains 6 cylinders.

 

[SpikyMikey]

This is the reason that my next car will not be a Mercedes. Not only have their prices rocketed but they've taken on their 'one car one price' policy.

BMW, as far as I'm aware, have not taken this agency approach as yet - weekend before last I negotiated a £7.2k discount on a new M340i, so their dealers are still allowed to work with the price. My choice was £72k for a new C43 or £58k (after discount) for a new M340i which is pretty much an equivalent car in terms of spec and as a bonus retains 6 cylinders.

Sounds like a "no-brainer" deal; was that on a car in BMW dealer stock or factory order?

 

[ALFAitalia]

ALFA are going this way soon too.

 

[Germgh0st]

Sounds like a "no-brainer" deal; was that on a car in BMW dealer stock or factory order?

Factory order that was

 

[JHS]

It actually makes it all more simple and transparent.

If it works it will be a good thing as it will likely increase the residual values of used cars. Also I would hope to see a return of equity on PCP deals at full term rather than the negative sitatuation that occured due to finance and deposit support as part of many deals.

The previous free for all wild west discount style wasn't healthy, it was about shifting volume and making little, zero or even sometimes negative margins on the unit and making money only on the finance. The issue is it's closing the stable door after the horse has bolted, so it will be interesting to see if the model works.

Technically it's not price fixing or market fixing as you would have collude with other manufacturers of the same product. No one else makes MB's so it's MB saying - this is the price, buy it or don't buy it.

Realistically it's a return to the 80's and 90's when you'd buy a new 190, you might get the odd option thrown in of you were a regular customer, but you paid full list. The car was still worth 70% of new price at 2-3 years old.........where's the downside? If you're a cash buyer it's likely to retain more value. If you're a PCP buyer it's likely to have a higher GFV and create equity at the end of the term.

It's this deprecition situation that lead me to buying an FF (well it was one of the factors). The alternative I was looking at was an Alpina B5 Touring.....they were pretty much the same price if I bought the Aplina new...sure I'd get manufacturers warranty....but then I did with the FF anyway. The difference being one of the £120K cars was likely to be worth £50k-£60K at 3 years old and the other wasn't.. repair costs? I bought a manufacturer warranty to insure against catastrophic repairs.

Don't assume it's bad, it might actually make £120k E63's viable to buy new as you won't be taking a huge bath the moment you drive it out the showroom.

Am I alone in trying to understand that a £20k/year depreciation is OK?

 

[Bobby Dazzler]

Am I alone in trying to understand that a £20k/year depreciation is OK?

It depends upon how deep your pockets are, I guess. Most brand new cars - especially those at this price point - will be purchased as a company car, rather than privately. That distorts the picture somewhat.

 

[JHS]

It depends upon how deep your pockets are, I guess. Most brand new cars - especially those at this price point - will be purchased as a company car, rather than privately. That distorts the picture somewhat.

I understand that, but £55/day just to own a car?
I am not a leftie, tree hugging , do gooding woke, but that would be a life changing amount of money to many people.
Ah, well, I am never going to be in a position to buy such a car anyway.

 

[Bobby Dazzler]

I understand that, but £55/day just to own a car?
I am not a leftie, tree hugging , do gooding woke, but that would be a life changing amount of money to many people.
Ah, well, I am never going to be in a position to buy such a car anyway.

It is indeed an awful lot of money.

 

[Red C220]

I understand that, but £55/day just to own a car?
I am not a leftie, tree hugging , do gooding woke, but that would be a life changing amount of money to many people.
Ah, well, I am never going to be in a position to buy such a car anyway.

This is the very reason Porsche are such a popular brand. Particularly if you get yourself on the GT model merry go round.

Some of the model range had such good residuals or even trade at overs that it was possible to buy brand new, run a car for a period of time and sell it for what you paid for it (sometimes more).

Mercedes (bar one or two very select models) have never been remotely close to this.

It creates an anomaly where it can actually be cheaper to buy and run a £150K supercar than a New E class, S class, C class etc.

Ultimately, what you're prepared to pay for a vehicle is determined by your personal circumstances and an accepted level of a certain cost associated with ownership.

I don't understand people spending £25K on stainless Steel Rolexes. but I'm comfortable buying a supercar which I drive daily, which many people find bonkers.

 

[Deleted member 55947]

The same principle works very well for Apple, whether it’ll work for a motor brand remains to be seen.
I wonder what their policy will be towards fleet sales ?

 

[Red C220]

The same principle works very well for Apple, whether it’ll work for a motor brand remains to be seen.
I wonder what their policy will be towards fleet sales ?

I would imagine that would be dealt with at manufacturer level and removed from dealerships, or there will be a tier system based purely on volume.

When I bought an Audi through Orange Wheels, the transaction took place at my local dealership with the fleet sales department, so they were obviously treating all referals via Orange Wheels as a single point of volume and applying fleet discounts to it.

The retail side of dealership that provided me with the test drive explained they've b losing £10K on invoice if they sold it to me at the price their fleet department did.

It's going to be based on volume alone.

I run my busines the same way, we don't do trade/retail pricing. It's based purely on volume - you want to buy lots of things all in one go (or firm advanced recurring orders) - we do a better price. I don't see vehicles being any different.

 

[Scooby_Doo]

So much for the new one car one price system :

MB Lincoln - C220 AMG line premium, 2240 miles , £80,000
MB Lincoln - C220 AMG Line . 5599 miles , £70,000
MB Lakeside - C220 AMG line premium, 3257 miles , £46,930
Ex Stock at MB Swansea - Brand New C200 AMG line premium 0 miles £47,345 discounted to £43,845 (looks very nice in white , I did have a think about buying it)

 

[liamt]

So much for the new one car one price system :

MB Lincoln - C220 AMG line premium, 2240 miles , £80,000
MB Lincoln - C220 AMG Line . 5599 miles , £70,000
MB Lakeside - C220 AMG line premium, 3257 miles , £46,930

I know which dealer I'd go to .

The agency model doesn't apply to used vehicles. Used stock is still owned by the dealers.

 

[Benz17]

Wow that is a big difference between the first one and the third, only 1k difference in mileage. Must be some sort of error, surely.