As a distributor, Penske may earn profit of as much as 8 percent on each Smart, compared with typical new-car margins of 2 percent as a retailer, Thomas Weisel's Nemer said.
Senior Vice President Anthony Pordon said Penske is now considering new global markets including Eastern Europe, Russia and Asia.
In the U.S., Penske will start distributing the Smart next year through 70 dealers, including seven of its own.
As a distributor, Penske may earn profit of as much as 8 percent on each Smart, compared with typical new-car margins of 2 percent as a retailer, Thomas Weisel's Nemer said.
Seems like this would make for a good case that Penske should push these through his currently owned and operated dealerships immediately. Have we dug in to the fact that the overall dealership number is pretty small?
Seems like this would make for a good case that Penske should push these through his currently owned and operated dealerships immediately. Have we dug in to the fact that the overall dealership number is pretty small?
I would think that as a part of the distribution deal MB required him to distribute through non-Penske MB dealerships.
Not a chance. Car dealers like to take full advantage of the supply-demand market, just look at that Mazada Miata epidosde.
Wouldn't surprise me to find the market artificially held back at reduced import numbers and the prices going through the roof for hungry contedners.
Then it'll settle back down to the ho-hum business like the Miata after the dealerships have had their time to feast.
Right now the Samrt has to contend with competitors that offer identical MPG at various prices. Some used cars can get the same mileage for a fraction of the cost of a SMART.
It all boils down to how bad you really want this car, and how much bucks you have to back up your dreams. There is an old saying which goes "some people have more dollars thane sense.."
Roger Penske is a smart smart savvy business man, and know how to fully exploit and take full advantage of an opportunity. That is how he got to where he is today. Him letting go a limited supply of Smart cars for only couple hundred dollars profit??? Not a chance in this world.
That wouldn't even pay his electric bill at his dealerships. My guesstimate is to DOUBLE the original asking price on the first year's batch of "limited supply" SMARTIE-mobiles - and they will come on hordes to pay.
EBAY will have a full "entrepeneurs" taking full advantage of this situation as well.
My only comment is "allow common sense to guide your rationale".
I doubt there is any rule or law preventing the PAG to hold as many "reservations" as they want for PAG dealers to sell as they please.
Estimates of 25,000 to 35,000 "reservations" @ $99 is a grand chunk of operating cost money
Getting the $99 taken off the invoice at time of sale will really mean their normal "Dealer Prep fee", "Documents fee", " Processing fee", or "LOT tax" of $150 is now just $50. Most of these type fees on the sales sheet are 100% profit
Another thing to consider is the true cost for PAG to order these cars...
Brand new in Germany these cars are cheaper. Even with the Euro dollar conversion, the prices stateside are a tad high. When I was in Kaiserslautern in April I could buy a well equipped 2007 Smart Cabrio for around 14K euro
Orlando - with all due respect I would say that you are in the minority as to the probability of price gouging. Penske has been very selective in contracting dealers so as to weed out the opportunists.
Case in point are the 1000 Grays that were imported. There are still many of them unsold.
Brand new in Germany these cars are cheaper. Even with the Euro dollar conversion, the prices stateside are a tad high. When I was in Kaiserslautern in April I could buy a well equipped 2007 Smart Cabrio for around 14K euro
I guess I'm missing something. In April the euro / $ conversion rate would have made that 14k euro car cost between $18.5 and 19k.
You are right and I was not too clear. The cheaper statement in an error...I was rememebering (dangerous with my age induced CRS)
The 14K Euros was the quote without VAT included. I can get a VAT relief form through the Military Moral Welfare Recreation (MWR) folks.... At the time I was comparing to the Grey Market prices.... It was when I started exploring import to USA intrigue that I found out about this program with PAG for the 2008 451s.
All I really am suggesting is that we don't know the true invoice costs of these cars. PAG may have made a fairly sweet deal for 16,000 to 22,000 of them.
My experience is not really a good example of this--- just fodder for thought
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