"Out of door" costs in Boston, MA

[Bremer Speck]

After I read various posts about some dealers around the country trying to take advantage of Smart buyers by adding hefty "dealer prep" charges, I sent an email to my dealer in Lynnfield, MA, and asked them what my costs will be. I received the following response.
QUOTE
Sorry to hear that other dealers might be adding fees on top of cars. However, I can tell you your expenses purchasing from our dealer and they are not the same as you’ve heard from other people:
MSRP (plus any factory add ons you chose)
$645.00 destination charge from smart USA
Mass charges $83 for registering the vehicle assuming you are in fact registering in this state
Mass sales tax
$29 inspection sticker (again, if Mass)
$259 doc fee and $5 title fee which is not new to smart and has been in place at this dealership since inception
MINUS $99 reservation fee you paid to smart USA
UNQUOTE
So, I guess, the dealer prep is $259 doc fee + $5 title fee. I guess, that is reasonable.
Cheers,
Ronald

[bmx43]

Originally Posted by Bremer Speck

After I read various posts about some dealers around the country trying to take advantage of Smart buyers by adding hefty "dealer prep" charges, I sent an email to my dealer in Lynnfield, MA, and asked them what my costs will be. I received the following response.
QUOTE
Sorry to hear that other dealers might be adding fees on top of cars. However, I can tell you your expenses purchasing from our dealer and they are not the same as you’ve heard from other people:
MSRP (plus any factory add ons you chose)
$645.00 destination charge from smart USA
Mass charges $83 for registering the vehicle assuming you are in fact registering in this state
Mass sales tax
$29 inspection sticker (again, if Mass)
$259 doc fee and $5 title fee which is not new to smart and has been in place at this dealership since inception
MINUS $99 reservation fee you paid to smart USA
UNQUOTE
So, I guess, the dealer prep is $259 doc fee + $5 title fee. I guess, that is reasonable.
Cheers,
Ronald

it's not reasonable when we are only paying $55 but i don't know that there is anything that can be done about it. nothing but pure profit to the dealer.

[SmartAzz]

As long as you are happy - to me calling a mark-up a doc fee doesn't make it any better and I think $250 is a good chunk of change..

[bmx43]

Originally Posted by SmartAzz

As long as you are happy - to me calling a mark-up a doc fee doesn't make it any better and I think $250 is a good chunk of change..

yep. like i've been saying, it's not even about the $250. i can afford that. it's about the damn principal. it takes 5 minutes to run docs on a cash sale. stop the madness. the cost of doing business (docs) is figured into the MSRP.

[jwight]

Originally Posted by bmx43

yep. like i've been saying, it's not even about the $250. i can afford that. it's about the damn principal. it takes 5 minutes to run docs on a cash sale. stop the madness. the cost of doing business (docs) is figured into the MSRP.

We don't know the actual difference between invoice and MSRP but I've seen 7% posted on this forum. Don't know what the Mercedes/Penske dealer holdback is but for most others it's around 3% of MSRP. So, let's say 10% profit built right in, and they want to add "doc" fees.

Oh yeah, forgot this part: "$259 doc fee and $5 title fee which is not new to smart and has been in place at this dealership since inception" which translated means "we've gotten away with it for years, what makes you think we're going to stop now?"

John

[bmx43]

Originally Posted by jwight

"$259 doc fee and $5 title fee which is not new to smart and has been in place at this dealership since inception" which translated means "we've gotten away with it for years, what makes you think we're going to stop now?"

John

yep exactly!

[Bremer Speck]

Believe me, I am not taken the side of the dealer. I am simply thinking about profits in general from a business point of view. If the dealer really makes about 10% between what PAG pays them and the "doc fee", we are talking roundabout $1800-2000 on my car, a convertible with all the options. My dealer is presently receiving 15 cars, plus 2-3 for the showroom and as demos. I was told 15 cars will be delivered that are pre-sold. So take 15 cars by very likely a maximum profit of $2000 each. That's $30,000 and may sound like a lot of money. Another calculation would be to say, there are 30,000 reservations and about 75 dealers nationwide. That's an average of 400 cars per dealership per year. 400 cars times a maximum profit of $2000 comes to $800,000 - Sounds like a lot of money, too. Divide that by 12 months and you are looking at $66,666.67 - That is a lot of sixes but not enough money to pay sales people, general overhead, etc. - IMHO, the Smart is a "loss leader" for Mercedes. The only reason for why they finally decided to import it is because some other people tried to do it (Zap, for example) and that was a thorn in M-B's side. They sell it now through PAG in the hopes that you will come back in a couple of years, to trade-up to a Mercedes (maybe, an A-class, which is slightly bigger than the Smart) or some other model, which has a bigger profit margin. Your view?

[jwight]

I remember the old saw about car dealers losing money on every sale but making it up in volume.

These guys do not lose money; when pro athletes retire they buy car dealerships for a reason - because they make a ton of money. Their job is to take as much of our money as they can, and ours, IMO, is told hold on to as much as we can.

John

[bmx43]

Originally Posted by Bremer Speck

Believe me, I am not taken the side of the dealer. I am simply thinking about profits in general from a business point of view. If the dealer really makes about 10% between what PAG pays them and the "doc fee", we are talking roundabout $1800-2000 on my car, a convertible with all the options. My dealer is presently receiving 15 cars, plus 2-3 for the showroom and as demos. I was told 15 cars will be delivered that are pre-sold. So take 15 cars by very likely a maximum profit of $2000 each. That's $30,000 and may sound like a lot of money. Another calculation would be to say, there are 30,000 reservations and about 75 dealers nationwide. That's an average of 400 cars per dealership per year. 400 cars times a maximum profit of $2000 comes to $800,000 - Sounds like a lot of money, too. Divide that by 12 months and you are looking at $66,666.67 - That is a lot of sixes but not enough money to pay sales people, general overhead, etc. - IMHO, the Smart is a "loss leader" for Mercedes. The only reason for why they finally decided to import it is because some other people tried to do it (Zap, for example) and that was a thorn in M-B's side. They sell it now through PAG in the hopes that you will come back in a couple of years, to trade-up to a Mercedes (maybe, an A-class, which is slightly bigger than the Smart) or some other model, which has a bigger profit margin. Your view?

it doesn't matter. plain and simple. i said this elsewhere and i'll say it again here. I live in CA, the state with the highest cost of living. if my dealer can "survive" on a $55 state mandated doc fee, then why can't a dealer in KS where the cost of living is half of that of CA but they seem to be charging $250 or more!

cost of doing business is figured into the MSRP of all cars. if they didn't want to sell the cars, they should not have signed up for a dealership.

eventually, the rest of the country will catch on and your lazy politicians will mandate the fees just like our lazy politicians did. until then, pay away.

also, FYI, Mercedes is NOT the importer of these cars. Penske (PAG) is. So the Smart is not a loss leader for MB, they have nothing to do with it. PAG and the dealerships assumed the risk, not MB.

[smartNM]

How do you figure that Mercedes assumed no risk in the deal?