Over the past three years, the automotive industry has faced quite a bit of turmoil. From the pandemic and lockdowns to supply chain shortages and aggressive price markups, car dealerships have been put through the wringer. Now, used car prices have gone up and there’s more inventory at dealerships, but no one wants to buy because of inflation. The prices are higher and because of interest rates, the monthly payments are higher.
The average price of a decent new car right now is around $46,000. At a typical interest rate of around 6-7% over a 60-month term (5 years), the monthly cost for a new car is around $1,000 per month.
Now, where does that put the car dealership industry? Well, dealerships now have inventory but they don’t have any buyers. Manufacturers are pressing on dealerships from the other end, saying they’re not going to produce hundreds of cars for dealer lots anymore, and some aren’t going to be selling to dealerships at all. Some manufacturers want to sell straight to the consumer, like Tesla. No markups by the dealership, just straight from the manufacturer to the consumer.
What’s that going to do for used cars? Will used cars only be sold through dealerships? Where do you see the used car business in two or three years? Will there be factory stores with a small used car department?
What about electric vehicles? Many of these manufacturers are telling dealerships that in 3-4 years, they can only sell EVs or mostly EVs. Many states are even canceling the eligibility of gasoline vehicles by the end of the decade. So dealerships won’t even be able to sell gas vehicles anymore; they won’t be allowed to go on the road. It’s clear that dealerships have to make a big transition if they want to stay afloat, and that’s going to put a big crimp on their parts and service business.
Most dealerships have a fixed absorption, meaning the fixed operations (service and parts) covers the fixed expenses; meaning overhead, rent, taxes, and insurance, all of this is paid for by their service and parts department. The sales department is where the profit comes from. So if your service and parts department can do 100% fixed absorption, you’re in good shape.
Well, electric vehicles don’t need as much service compared to gasoline vehicles. They don’t have internally lubricated engines or transmissions that need to be serviced regularly. They might need new brakes or tires, but that’s not the same as more expanded repairs. A lot of this is covered by a warranty, but the manufacturer still pays the dealer for the warranty. So what happens when everything goes to EVs and the fixed absorption only comes out to 20-30%? Well, now the sales department has to cover the difference; and if you have a lower margin and a lower volume, that may not be enough to withstand the expense footprint of a large traditional dealership.
What do you think about phasing out car dealerships and buying directly from the manufacturer? Take away the wishful thinking of how you want a car dealership to be, and let us know how you think it’s actually going to be. No one wants to deal with a runaround salesperson who goes back and forth with the elusive “manager in the back”, would this alternative be a better option? What if negotiating was taken out of the picture and cars had fixed prices? What is the happy medium for consumers and how does a dealership enterprise create a structure that’s profitable and sustainable without going out of business?
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For as little as $159 for most processes, we will save you the headache and prepare all of the car title paperwork needed to get you a new title. Simply choose the title recovery method you’d like to use and we’ll get started!
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Order Vermont Title LoopholeOrder Deceased Owner Title TransferOrder Bonded Title ProcessOrder Abandoned Vehicle ProcessOrder Prior Owner ContactOrder Lien Release Request LetterPGlmcmFtZSBzcmM9Imh0dHBzOi8vYXBwLmFjdWl0eXNjaGVkdWxpbmcuY29tL3NjaGVkdWxlLnBocD9vd25lcj0xOTQ4ODEyNiZhcHBvaW50bWVudFR5cGU9MjMwNjY0MTAiIHRpdGxlPSJTY2hlZHVsZSBBcHBvaW50bWVudCIgd2lkdGg9IjEwMCUiIGhlaWdodD0iODAwIiBmcmFtZUJvcmRlcj0iMCI+PC9pZnJhbWU+PHNjcmlwdCBzcmM9Imh0dHBzOi8vZW1iZWQuYWN1aXR5c2NoZWR1bGluZy5jb20vanMvZW1iZWQuanMiIHR5cGU9InRleHQvamF2YXNjcmlwdCI+PC9zY3JpcHQ+
In the aftermath of hurricanes in Florida, the salvage auction pipeline is witnessing an influx of flood-damaged vehicles. While the rebuilding process is underway, it’s crucial to be aware of a potential pitfall – flood vehicles being sold with non-repairable or junk titles, often labeled as a “Certificate of Destruction.”
Vehicles designated as non-repairable or given a Certificate of Destruction are considered beyond salvage. Even if they appear outwardly undamaged or require minimal repairs, these titles indicate that the vehicle has been reported as irreparable due to severe damage, such as flooding. Once a vehicle receives this title, its VIN (Vehicle Identification Number) is canceled, rendering it ineligible for any state to issue a title.
The cancellation of the VIN places the vehicle’s status in the National Motor Vehicle Title Information System (NMVTIS), a federal database. This system ensures that the non-repairable status is recognized nationwide, preventing the vehicle from ever being legally titled and registered for road use.
Buyers, especially those unaware of the implications, might be tempted by seemingly well-functioning flood vehicles in salvage auctions. It’s essential to recognize that even if repairs are feasible, the non-repairable designation means the vehicle can never regain road legality.
Whether you’re a consumer or purchasing through a broker, here are crucial tips:
While the availability of flood vehicles in salvage auctions might seem like an opportunity, the non-repairable title turns these vehicles into potential money pits. Being informed about the different title designations and thoroughly checking a vehicle’s history can save you from investing in a car that’s practically worthless for road use.
In the aftermath of natural disasters, it’s crucial for both consumers and industry professionals to exercise due diligence and make well-informed decisions when dealing with flood-damaged vehicles.
If you’ve ever wondered about the intricacies of titling a motor vehicle, you’re not alone. The process can be quite nuanced, varying slightly from state to state. In this update, we’ll focus on the requirements for obtaining a vehicle title, drawing insights from the state of Michigan, which mirrors the general requirements found across the United States.
The Michigan Secretary of State’s frequently asked questions shed light on the key elements required for titling and registering a vehicle. Here’s a breakdown:
Beyond the essentials, there are additional factors to keep in mind:
While insurance isn’t a prerequisite for obtaining a title, it’s a prudent step. Having insurance coverage protects your investment, providing financial security in case of theft, accidents, or other unforeseen events.
Understanding the requirements for titling a vehicle is crucial for a seamless process. Whether you’re dealing with a vehicle purchase, transfer of ownership, or estate matters, adherence to these guidelines ensures compliance with state regulations. While we’ve focused on Michigan, these principles apply broadly, allowing you to navigate the titling process with confidence. Stay informed, be diligent, and ensure all necessary documentation is in order for a hassle-free vehicle titling experience.
If you’re an owner of a classic car or restore classic cars, be on the lookout for unscrupulous restoration companies. Here’s an example of a restoration gone wrong that ended up costing the owner millions of dollars.
According to an article from IndyStar, the ex-CEO of Angie’s list, Bill Oesterle, recently won a lawsuit against a former mechanic. In this case, Oesterle was restoring classic cars and decided to work with a boutique mechanic, which is someone who does work on older vehicles. This mechanic performed work on the vehicles and also helped him locate others to purchase. Well as it turns out, over the course of a couple of years, Oesterle was overcharged for service work on multiple rare vehicles, and some of the vehicles were misrepresented.
Oesterle paid $50,000 for what he thought was a very rare Austin Healey 100M sports car as a coveted factory model that just needed some assembly. Come to find out, the vehicle that was purchased was not the original factory model that the alleged mechanic had promised. The mechanic told Oesterle the color, and the cost for assembly at $10,000, but sent an invoice for $130,000. But that wasn’t even the worst. In another instance, Oesterle purchased another classic car for $16,000 and was told the work would be done in two years and cost $200,000. Four years later, the job still isn’t done, but Oeseterle was left with bills totaling over a million dollars.
If you’re going to hire someone to restore your vehicle, make sure to research the company or the person beforehand. Even if you did your due diligence in the beginning, due diligence is an ongoing process. If the numbers aren’t adding up, say something as soon as possible.
If you’re a mechanic, make sure you’re managing your restorations properly. The mechanic in this case will have to pay back $7.2 million because of treble damages. Treble damages mean that if you’ve caused damage through fraud, you have to pay back three times what you took in. Treble damage statutes are found in many states, but not all.
So make sure if you’re a mechanic that you’re managing your restorations properly, and if you’re a vehicle owner, make sure you get regular updates. Do your due diligence on the company not only in the beginning but throughout the restoration process.
If you find yourself in the unfortunate situation of having lost the title for your motor vehicle, understanding who is eligible to apply for a duplicate title is crucial. Each state has its specific procedures, but the fundamental principle is consistent across the board – the current title owner is the only party legally entitled to apply for a duplicate or replacement title.
Let’s take a closer look at the application process, using the state of Utah as an example. Most states have similar forms for duplicate title applications. The key factor in this process is that the person signing and applying for the duplicate title must be the individual currently listed in the official title records.
Key Points:
Importance of Lien Release: The involvement of a lien holder is crucial, as the DMV needs confirmation that the loan has been paid off, even if it has been done in full. If the DMV is not informed, the lien holder’s name will not be removed from the title.
If your name does not appear in the title records, you are not eligible to apply for a duplicate title. However, there may be alternative title options available, and exploring these alternatives is essential. Check the DMV website for more information on the various title types and the eligibility criteria for each.
In summary, applying for a duplicate title is a privilege granted to the legal owner whose name is already on file with the government as the registered owner of the vehicle or lien holder. Understanding and adhering to these regulations ensures a smooth and valid duplicate title application process.
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