Is it a scam when a dealership or private seller charges more than original price? Why do they charge more than the original price?
Supply and demand. Fewer cars have been produced during the pandemic. There are chip shortages, which have closed some factories. Auto manufacturers have also seen the benefits (for them) of reduced supply on profit margins. So, there you go
The same thing is happening to the housing market, BTW.
I wouldn’t call it a scam, it’s just the law of supply and demand in action.
MSRP is set once for the year and is the same everywhere in the country. But local demand and short-term factors can temporarily drive prices over sticker at a given dealer. Unfortunate but very normal economics.
The exception is when they add useless things like “underbody protection” and overcharge for it... that’s a scam.
Pretend you're a miller selling flour in a small village. Suddenly the flour supply falls below customer demand for it. Pretty soon all the bakers in the area are shoving money in your face, and having bidding wars for your flower. That is how prices go up, and it's the way it has always been in free societies, and always will be.
In planned economies like we have in Canada, the government thinks they know best, and manipulate the economy. They dump out hectolitres of milk in order to artificially drive up the price. That to me is "gouging" and is the real sickness.
The scam isn't fluctuating prices. The scams are dealerships themselves. There is a stupid law in the books that says car have to be sold through dealerships. (Tesla found and is exploiting a loophole, that other car manufacturers cannot exploit.)
The dealership laws make prices higher than the probably should be, generally speaking.
I agree. It's anti-competitive
It's called unchecked Capitalism. @mountainmanjoe is a huge fan...he can explain it I'm sure. {black}:wink:
Basically, they are just out to get as much as they possibly can. It's just greed and I wouldn't buy from a person or business that price gouges. Either buy from someone else or skip the purchase all together.
I call it human nature. People will try to game and corrupt any system. At least the free market rewards competition, which is essential to freedom and a healthy economy.
If someone tells me "To Go To Hell" and I end up there, I wouldn't be a bit surprised to find out that Satan was a Horse and wagon dealership owner!
Not the best but definitely not a scam.
According to what I see around me, people set higher prices so they still get the amount of money they want if someone bargains with them for a lower price.
Even years ago, I had heard from others they went in to a particular dealership to see a specific car advertised on their website at a “good” price (that’s the only reason they went in), but when they got there they found out that price was only meant to generate interest and get them physically in the door. It turned out they didn’t qualify for that special pricing. Or in other cases, if they qualified, the dealer simply added fees on top of that listed price (including requiring financing through their arm). I call it “switch and bait” and that is not right. What I am mentioning is a different issue than just supply/demand. So, whenever you shop for a vehicle (even in normal times when things settle down again), just be aware the initial price and final price may not match. Not all dealers do this, but still something to be aware of: lots of dishonesty, shady practices out there.
