GM-Volt.com : Questions to Darryl Harrison Jr. of Nissan USA

[evnow]

If I find myself competing with other buyers for a limited supply who are willing to pay premiums, I'll just step aside and let them be the early adopters.

No way. Nissan has led us believe through various means that we are "reserving"/"pre-ordering" and there is a priority list by market. Anything that breaks that would be unethical & most probably illegal.

Anyway, here is the important part. Nissan as a company is banking on Leaf - they are not going to want to create huge PR problems by letting their dealers throw the priority list in the dustbin and sell to the highest bidder. That will make NY Times frontpage news - this is not some eagerly awaited teen muscle car that dealers can take advantage of.

 

[Rat]

It's the "step aside" part that I have trouble with. What if the cars are delivered to my local dealer and the one nearest my house calls me up and says they have "my" Leaf now in, would I like to come down and test drive it. I do and want to buy it - at MSRP - and the dealer says sorry, it's $3000 more than that + an extra $1500 for the charger. So I try another dealer (only one other nearby) and he says all his are reserved for the closer people on his list, or he is doing the same gouging. Now what happens? If I decide to wait until the demand is less and the gouging stops, do I still have first right to buy, or is my reservation number no longer good, or "renumbered" to put me back at the end of the line, etc.? No one knows yet. I think we should be able to keep our spot in line indefinitely as long as our $99 is still held, but the dealer can still say no dice to MSRP and if I pass sell it to someone who walks in the showroom with no reservation and is willing to pay the marked up price. If Nissan "expires" the number and refunds your money when you fail to buy within a short time after "your" reserved car is offered, even if due to dealer gouging, then I will be one ticked off consumer.

 

[evnow]

It's the "step aside" part that I have trouble with. What if the cars are delivered to my local dealer and the one nearest my house calls me up and says they have "my" Leaf now in, would I like to come down and test drive it. I do and want to buy it - at MSRP - and the dealer says sorry, it's $3000 more than that + an extra $1500 for the charger.

Not the way it will work at all.

You select the dealer where you want your car delivered and Nissan will send it there. Besides, the charger would have to installed before hand and that is between you and AV. Nissan is not directly involved.

 

[LTLFTcomposite]

I guess this has wandered off the original point of this thread, but what the hell.

Something easily overlooked in all this talk about "reservations" is that while there will probably be a HUGE rush of early adopters wanting to get their hands on the first ones, if they have any kind of production capability at all, supply could easily catch up with demand as long as gas prices stay low. Remember at $3 a gallon the leaf doesn't really make economic sense; you'd be better of with a Versa and you don't have to buy a charger or worry about range. The $ saved on the purchase would fuel a Versa for 8-10 years and that's assuming the electricity is free. 13,000 reservations is nothing. Could well be the case that in 12-18 months you could find them on the lot selling at a discount off msrp. Or pick up a used one from somebody who had a job change etc and the car no longer works for them.

 

[Rik]

Here's a couple of experiences I've had buying new cars that were supply constrained.

When the MB SLK was first released a dozen or so years ago, supply was so constrained we had to wait 9 months from the time we placed our order until our car was delivered. Our dealer did not even try to charge a penny over MSRP. I learned that while MB could not force their dealers to not charge more than MSRP, if they learned one of their dealers did that, MB would cut that dealer's allocation for new cars. That apparently was a sufficient deterrent, because MB dealers could have charged way over MSRP for SLKs back then.

When we ordered a VW Jetta Sportwagen diesel (JSW TDI) in June 2008, these cars were supply constrained. We put down a $500 deposit for our car at MSRP. Several months later the dealer called to refund our deposit because they said it was going to take too long for them to get us a car. We objected, said we did not want our order canceled. We were assured that the order would not be canceled. We got our deposit back. It's been nearly two years, and that's the last we heard from that dealer. I have no doubt they sold their allocation of JSW TDIs at more than MSRP because most VW dealers - including every one of them we contacted - ended up doing that last year. We wanted a JSW TDI so we bought one from a different VW dealer in April 2009 at a premium over MSRP. We are quite happy with the car and don't regret the purchase, but I am not happy with VW dealers.

I have no idea what Nissan policy is about this. Are they like MB -- punish a dealer who charges more than MSRP? Or are they like VW -- hands off with their dealer pricing? The answer to that question may determine what we earlier adopters end up paying for our Leaf, because I think they will be supply constrained through 2011.

 

[LTLFTcomposite]

Here's a couple of experiences I've had buying new cars that were supply constrained.

When the MB SLK was first released a dozen or so years ago, supply was so constrained we had to wait 9 months from the time we placed our order until our car was delivered. Our dealer did not even try to charge a penny over MSRP. I learned that while MB could not force their dealers to not charge more than MSRP, if they learned one of their dealers did that, MB would cut that dealer's allocation for new cars. That apparently was a sufficient deterrent, because MB dealers could have charged way over MSRP for SLKs back then.

When we ordered a VW Jetta Sportwagen diesel (JSW TDI) in June 2008, these cars were supply constrained. We put down a $500 deposit for our car at MSRP. Several months later the dealer called to refund our deposit because they said it was going to take too long for them to get us a car. We objected, said we did not want our order canceled. We were assured that the order would not be canceled. We got our deposit back. It's been nearly two years, and that's the last we heard from that dealer. I have no doubt they sold their allocation of JSW TDIs at more than MSRP because most VW dealers - including every one of them we contacted - ended up doing that last year. We wanted a JSW TDI so we bought one from a different VW dealer in April 2009 at a premium over MSRP. We are quite happy with the car and don't regret the purchase, but I am not happy with VW dealers.

I have no idea what Nissan policy is about this. Are they like MB -- punish a dealer who charges more than MSRP? Or are they like VW -- hands off with their dealer pricing? The answer to that question may determine what we earlier adopters end up paying for our Leaf, because I think they will be supply constrained through 2011.

Even though they might not have charged over MSRP, did the MB dealer tack on any bogus extras like paint sealer? And did they charge you a dealer fee?

 

[Rik]

Even though they might not have charged over MSRP, did the MB dealer tack on any bogus extras like paint sealer? And did they charge you a dealer fee?

No and No.

 

[redLEAF]

Even though they might not have charged over MSRP, did the MB dealer tack on any bogus extras like paint sealer? And did they charge you a dealer fee?

No and No.

It appears that MBZ has a tight relationship with its dealer network as this same strategy (holding to MSRP) was the same thing I experienced with buying a new smart in '08 when it first came out. In Chicago only 2 MBZ dealers were granted the smart franchise out of about a dozen MBZ dealers in Chicagoland. For Nissan, the strategy may be different as the LEAF is not a separate 'brand' but I doubt ALL of them (there are many more Nissan than MBZ dealers) will offer the LEAF (at least initially) but I could be wrong. The smart rollout also assigned geographic areas for smart purchasers so dealer's couldn't poach each other's customers -- as to the add-on comments, no my MBZ/smart dealer did not do that either; but I will tell you that the maintenance fees for say 5K, 10K, etc. service is higher than most Japanese imports despite how small (and to others how simple) the smart is; it's very compact and requires special tools, uses synthetic oil, etc., etc. -- this shouldn't be a problem with the LEAF as noted by others on pure EV's.

 

[LEAFfan]

Here's a couple of experiences I've had buying new cars that were supply constrained.

When the MB SLK was first released a dozen or so years ago, supply was so constrained we had to wait 9 months from the time we placed our order until our car was delivered. Our dealer did not even try to charge a penny over MSRP. I learned that while MB could not force their dealers to not charge more than MSRP, if they learned one of their dealers did that, MB would cut that dealer's allocation for new cars. That apparently was a sufficient deterrent, because MB dealers could have charged way over MSRP for SLKs back then.

When we ordered a VW Jetta Sportwagen diesel (JSW TDI) in June 2008, these cars were supply constrained. We put down a $500 deposit for our car at MSRP. Several months later the dealer called to refund our deposit because they said it was going to take too long for them to get us a car. We objected, said we did not want our order canceled. We were assured that the order would not be canceled. We got our deposit back. It's been nearly two years, and that's the last we heard from that dealer. I have no doubt they sold their allocation of JSW TDIs at more than MSRP because most VW dealers - including every one of them we contacted - ended up doing that last year. We wanted a JSW TDI so we bought one from a different VW dealer in April 2009 at a premium over MSRP. We are quite happy with the car and don't regret the purchase, but I am not happy with VW dealers.

I have no idea what Nissan policy is about this. Are they like MB -- punish a dealer who charges more than MSRP? Or are they like VW -- hands off with their dealer pricing? The answer to that question may determine what we earlier adopters end up paying for our Leaf, because I think they will be supply constrained through 2011.

Rik...the simple solution is to buy from a Nisan-owned dealer. They aren't allowed to charge more than MSRP.

 

[Rik]

Rik...the simple solution is to buy from a Nisan-owned dealer. They aren't allowed to charge more than MSRP.

Good to know. Thanks!

 

[garygid]

Now, how to identify or locate a "Nissan-Owned" dealer?

 

[redLEAF]

Now, how to identify or locate a "Nissan-Owned" dealer?

I'll second that ... I think most if not all the dealers in Chicagoland are NOT Nissan owned based on both the TV and Newspaper ad's I've seen (always shows the owner grinning) but if there is one out this way I'd like to know or have an easy way to figure it out

 

[garygid]

Does Nissan have a list of the dealerships that they "own" (if any)?

 

[EVDRIVER]

Does Nissan have a list of the dealerships that they "own" (if any)?

It is my understanding that they do not own any dealerships. Where are these "Nissan Owned" dealerships?

 

[garygid]

Then, this "pay only MSRP" at a Nissan-owned dealership is just a fantasy?

 

[mwalsh]

It is my understanding that they do not own any dealerships. Where are these "Nissan Owned" dealerships?

See edit below...

 

[mwalsh]

It is my understanding that they do not own any dealerships. Where are these "Nissan Owned" dealerships?

Actually it was leaffan, who said this of his local dealership: "I can't speak for other dealers, but my dealer here already told me that they aren't ALLOWED to charge over MSRP since Nissan owns them...he said since they are not an Independent dealer, they have to sell THIS car at the already set price...when Nissan's letter said "dealer sets price", they were talking about all the Independent dealers. So I'm not a BIT worried about paying over MSRP."

 

[evnow]

I tried finding Nissan owned dealership list - I couldn't. May be someone else thinks of a better search phrase ...

 

[garygid]

I also tried, and found only one reference - that the % of female "sales" persons had gone up from 4% to 6% at "Nissan owned dealerships".

Well, maybe there is just one?

 

[Bicster]

I tried finding Nissan owned dealership list - I couldn't. May be someone else thinks of a better search phrase ...

In the United States, however, direct manufacturer auto sales are prohibited in almost every state by franchise laws requiring that new cars be sold only by dealers. These bans on direct manufacturer sales are part of a broad array of state laws that bar manufacturer ownership of dealers and regulate entry and exit of dealers through territorial restrictions and provisions on dealer termination.

Link: http://www.justice.gov/atr/public/eag/246374.htm