Pricing

[gipp]

This is just a personal observation. paying a dealer from 1% to 11% markup for a full walk-around presentation, vehicle wash and detail, full tank of gas, full delivery including demonstration of features and training on how to work the knobs and buttons, a contact (a real person) they can call if they have a problem, etc...PLUS the product.

I have never seen a salesman that provided a full tank of gas and a full demonstration of features and a contact for future problems. When I bought my wife a Lexus RX for her birthday I asked the salesman if he could put a ribbon on the car. I even supplied the ribbon. I told him we would be stopping at 7:30pm to pick up the car after a bithday dinner down the street. This salesman was very quick to give me his CSI card and ask for a perfect score. Well, you know what happened. When I brought my wife to the Lexus dealer for her big suprise the car was not even at the dealership, it was still at the storage lot. Not washed, not detailed and of course without the big red ribbon. The girl at the front desk felt so bad she got one of the mechanics to go get it and wash it up. The salesman comes up with a big smile and says he got the date wrong but would I be interested in an LS460h for myself so that we could drive home together in new cars.

I relay this story because I believe that we are willing to pay for premium service but have been conditioned over time not to expect it. Car buying has sadly gone from the fun, exciting family event into an ugly commodity transaction. Professional sales personel are rare. Most know nothing about the car except what they read in the brochure between customer visits. In New Jersey, it is rare to even get a sales person who will bother taking a test drive with you. They will say something like-"Well you seem to have done your research so I'll let you enjoy the test drive by yourself". Here are the keys to that blue one over there". You will note that the blue one isn't the same configuration or package level and they just shrug and say that is the one they have available. This happens at Lexus, Mercedes, Audi, VW, etc... At normal dealers you are lucky to get a sales person who speaks English. The only dealers in NJ that seem to care at all are Infiniti.

So guess what happens. We research, find the car we want. Test drive it to make sure it is what we want. And then we start the buying process. We go to the internet, we get four or five price quotes over the phone and then we go the dealership closet to our house and waste 4 or 5 hours haggling to get them to match the lowest price we already have from another dealer.

We then know that we will be subjected to different looks and verbal abuses from the business manager because we don't want to buy 12 year anti gerbal protection for the interior glove box for $2342. Window stenciling is also "dealership policy" for $385 . We can order the exact same kit on the interent any day for $19.95. We indicate that we live next to the Motor Vechile department but are told that it "policy" that we can not register the vehicle ourselves. They then charge you a $225 service fee to have you drive back to thier dealership for your plates 3 weeks later. Then they tell you to a make an appointment to have the license plates "installed" by the service department. When they put the plates on the car they will not bother to clean off the adhesive left from the temporary plate and but will ask if you have reconsidered the anti hamster protection and by the way since you now have a couple hundred of miles on the car you will be a total idiot if you don't let us put the special oil conditioning additive into the crankcase for $69 to ease the break in period.

This is why we haggle and distance ourselves. We know we will be ripped off for whatever and whenever possible for several hundred if not thousands after the sale before we can escape the clutches of the delaership. We know that the second we write the check we will be disrepected, probably verbally abused and definately not valued.

I am sure there are still professional sales people and dealerships that operate with integrity in the USA. I apologise in advance to those who do not condone or practice such tactics. But the fact is majority rules and the public will do what it needs to for the protection of thier family and assets.
I have my own business and I would not survive a week if I treated my customers with the institutional fake smiles and legendary lies and promises that hallmark the auto industry and the car purchase process.

 

[GrandPrix08]

Well, I wouldn't say ALL salespeople does that. When I got my 08 Grand Prix, the salesperson spent an hour(well, almost), explaining about the features of the car from the dash to the trunk, and the tank was full. The car was ready and all washed up about 3 days before I made the downpayment since they drove it there from the other dealer down south, who had it. So, I wouldn't put down ALL the dealers, though there are many like that. My only gripe(though I didn't really express it to them), was that it already had 52 miles on it, for they drove it there, I expected them to transport it by the automobile carriers, but oh well.

I am currently very happy with my car and the kind of service I got. I just got a first, free oil change done, and I have no complaints with the service and the dealer.

But, I do admit, there are MORE, BAD dealers than a good ones, so you have to watch out.

 

[EdVoylesHyundai]

Are you able to divulge about what percentage of your personal income comes from survey-related bonuses? I've heard that they can be the different between paying the mortgage and not paying it, but have never heard a figure.

$0 (zero)

But, I am not a salesperson anymore. Every manufacturer varies in the support they give their salespeople, but Hyundai is relatively generous when compared to Toyota and Nissan (at least how they were when I sold for them about 6-7 years ago). And every dealer has a slightly different pay plan with different bonuses and such. As a salesperson here, as little as 0% to much as ~30-40% of your income can come from CSI-related bonuses. The wide variation comes from the fact that commission is paid based on gross profit, but the CSI bonus is a fixed amount per vehicle. So as the amount of commission rises, the percentage of the pay made up by the bonus declines. So yes, survey scores can make a HUGH impact on the salesperson's ability to pay the bills. If a salesperson is relying on CSI money to pay the bills, they may find themselves in trouble if they get one or two bad surveys. Currently with Hyundai, each salesperson has to maintain a certain CSI average to get paid any CSI bonuses If they fall below the required average, they do not get paid any CSI bonus until they get it back up. The store is also required to maintain a certain store average to be eligible for certain programs.

Hope that helps.

 

[EdVoylesHyundai]

I have never seen a salesman that provided a full tank of gas and a full demonstration of features and a contact for future problems. When I bought my wife a Lexus RX for her birthday I asked the salesman if he could put a ribbon on the car. I even supplied the ribbon. I told him we would be stopping at 7:30pm to pick up the car after a bithday dinner down the street. This salesman was very quick to give me his CSI card and ask for a perfect score. Well, you know what happened. When I brought my wife to the Lexus dealer for her big suprise the car was not even at the dealership, it was still at the storage lot. Not washed, not detailed and of course without the big red ribbon. The girl at the front desk felt so bad she got one of the mechanics to go get it and wash it up. The salesman comes up with a big smile and says he got the date wrong but would I be interested in an LS460h for myself so that we could drive home together in new cars.

I relay this story because I believe that we are willing to pay for premium service but have been conditioned over time not to expect it. Car buying has sadly gone from the fun, exciting family event into an ugly commodity transaction. Professional sales personel are rare. Most know nothing about the car except what they read in the brochure between customer visits. In New Jersey, it is rare to even get a sales person who will bother taking a test drive with you. They will say something like-"Well you seem to have done your research so I'll let you enjoy the test drive by yourself". Here are the keys to that blue one over there". You will note that the blue one isn't the same configuration or package level and they just shrug and say that is the one they have available. This happens at Lexus, Mercedes, Audi, VW, etc... At normal dealers you are lucky to get a sales person who speaks English. The only dealers in NJ that seem to care at all are Infiniti.

So guess what happens. We research, find the car we want. Test drive it to make sure it is what we want. And then we start the buying process. We go to the internet, we get four or five price quotes over the phone and then we go the dealership closet to our house and waste 4 or 5 hours haggling to get them to match the lowest price we already have from another dealer.

We then know that we will be subjected to different looks and verbal abuses from the business manager because we don't want to buy 12 year anti gerbal protection for the interior glove box for $2342. Window stenciling is also "dealership policy" for $385 . We can order the exact same kit on the interent any day for $19.95. We indicate that we live next to the Motor Vechile department but are told that it "policy" that we can not register the vehicle ourselves. They then charge you a $225 service fee to have you drive back to thier dealership for your plates 3 weeks later. Then they tell you to a make an appointment to have the license plates "installed" by the service department. When they put the plates on the car they will not bother to clean off the adhesive left from the temporary plate and but will ask if you have reconsidered the anti hamster protection and by the way since you now have a couple hundred of miles on the car you will be a total idiot if you don't let us put the special oil conditioning additive into the crankcase for $69 to ease the break in period.

This is why we haggle and distance ourselves. We know we will be ripped off for whatever and whenever possible for several hundred if not thousands after the sale before we can escape the clutches of the delaership. We know that the second we write the check we will be disrepected, probably verbally abused and definately not valued.

I am sure there are still professional sales people and dealerships that operate with integrity in the USA. I apologise in advance to those who do not condone or practice such tactics. But the fact is majority rules and the public will do what it needs to for the protection of thier family and assets.
I have my own business and I would not survive a week if I treated my customers with the institutional fake smiles and legendary lies and promises that hallmark the auto industry and the car purchase process.

Wow, that's terrible! I feel your pain and I am sorry that the dealer network up there has their heads so far up their...well, you know what I mean. Dealers like that suck. I understand your desire to protect your family and your wallet. It reminds me of the badger commercials for Johnson auto group. If you haven't seen them, you should (youtube). They pretty much sum up your post. It is unfortunate that these dealers are conducting business like that. They obviously have lost sight of the fact that they are in business for the customers and without the customer, there is no need for the dealer. As a business owner, you understand this concept. I hope your dealings with dealers get way better in the future. That sucks about the Lexus dealer. Sheesh. We would love to put a bow on your wife's new car!

 

[mkaresh]

It does, thanks.

The whole CSI system, with the requirement of perfect scores, is unreasonable. With more realistic targets, it would help. But when you expect perfect scores, you end up with salespeople explicitly asking for perfect scores. And neither the salesperson or the buyer feels comfortable with the request.

 

[EdVoylesHyundai]

It does, thanks.

The whole CSI system, with the requirement of perfect scores, is unreasonable. With more realistic targets, it would help. But when you expect perfect scores, you end up with salespeople explicitly asking for perfect scores. And neither the salesperson or the buyer feels comfortable with the request.

And nobody benefits from that type of survey because it is completely rigged. In recognition of this, Hyundai has adopted a simple survey system with an actual grading "curve" that asks a couple simple questions and then give the buyer an opportunity to leave a message for the dealer to listen to. This has been a fantastic feedback tool and has allowed us to evaluate changes to our processes and facilities with direct feedback from customers. And you can get a grade other than perfect and still be eligible for benefits.

 

[mkaresh]

Is this a recent change?

When I conducted a survey on dealer practices WRT CSI surveys about a year ago, Hyundai salespeople tended to be pushy about getting perfect scores on the surveys.

 

[Viking]

A lot of great dialogue in this thread about dealership experiences - both good and bad. Not to be a downer but I would love to get it back to pricing.

I am anxiously awaiting the mid-July date to see a Genesis first hand and determine if it lives up to my expectations (after months of pre-news). Thanks to EdVoylesHyundai we have the pricing by package - or at least the MSRP by package. We will have to see if actual prices fall at, above or below those costs.

Does any one have any information on expected lease costs? I am still very curious how banks will compute the expected depriciation rate - since it is such an important part of the equation yet this vehicle is new.

 

[unknown_owner]

I see this thread getting so big with concern that I hope Hyundai takes some of the things said on here with some concern.

 

[EdVoylesHyundai]

Is this a recent change?

When I conducted a survey on dealer practices WRT CSI surveys about a year ago, Hyundai salespeople tended to be pushy about getting perfect scores on the surveys.

It is less than a year old. The perfect survey syndrome has been an issue with Toyota, Hyundai, Mitsu and Nissan when I worked for each. PM for more info b/c thread is indeed off topic.

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[luckfam]

I am really looking forward to the Genesis! I am a little dissappointed with the pricing as I really want the technology package, but not for an additional $7,000. The features in the technogy package is what makes the car so sweet! I still have a hard time paying $40,000. Before I even found out about the Genesis I had narrowed my choices down to a 2006 Lexus GS or Infiniti M35 and figured that I would pay about $33,000-$35,000 with nav and rear camera. So when I found out that I could get a brand new car for roughly the same amount I was stoked!! Now if I get it it will have to be without all of the technology that I love:-((( What is a man to do???

 

[Sal Collaziano]

I am really looking forward to the Genesis! I am a little dissappointed with the pricing as I really want the technology package, but not for an additional $7,000. The features in the technogy package is what makes the car so sweet! I still have a hard time paying $40,000. Before I even found out about the Genesis I had narrowed my choices down to a 2006 Lexus GS or Infiniti M35 and figured that I would pay about $33,000-$35,000 with nav and rear camera. So when I found out that I could get a brand new car for roughly the same amount I was stoked!! Now if I get it it will have to be without all of the technology that I love:-((( What is a man to do???

Welcome, LuckFam.. A lot of people are a little disappointed with the price.. Let's see how it goes when the Genesis hits showrooms. It could go either of two ways:

1. Dealerships price the car higher because they're selling fast
2. Dealerships give discounts because they're not selling fast

So I'd say you have about a 50/50 chance of getting a really good deal if you wait just a little longer...

 

[mkaresh]

I think every Hyundai to date has sold at a discount. With fuel prices high and interest in luxury cars waning, they'll probably have to add incentives.

I say this irrespective of the price. I'm not surprised by the price myself, perhaps because I never believed it'd be possible to start such a car under thirty.

 

[luckfam]

Thanks. I guess we will all wait to see what happens. The waiting is killing me

 

[rv65]

As for iPod you must buy a special cable. You can't just plug the iPod in using the USB cable. You must buy a hyundai cable. The hyundai cable costs around 24 to 30 USD. It plugs into both USB and Aux inputs. It's the only way to get full iPod integration.

 

[mkaresh]

Thanks for that bit of info. For the price comparison part of my site I list all features. I believe that if a car has iPod integration, it must have a USB port. But it can have a USB port and not offer full iPod integration.

 

[Simonwpb]

After only one month of retails in the pre-launch of Genesis S. Korean media is reporting lukewarm sales of the Genesis in the USA. nobody seems to have told them that the cars are not in wide supply yet, and no advertising has begun!

Ironically, Hyundai is going to be faced with a domestic gray market because of the disparity between the NA and S. Korean pricing.

S Koreans Reimport Hyundai Genesis From Cheaper US Market

SEOUL, Aug 7 Asia Pulse - When Hyundai Motor Co. (KSE:005380) debuted its new rear-wheel drive Genesis luxury sedan earlier this year, executives there were hoping to find a way to penetrate the luxury auto segment of the United States.
Nearly seven months later, however, Hyundai is facing a new headache at home as South Korean consumers have become increasingly aware of the fact that they have to pay 40 per cent more for the Genesis sedan than American consumers.

Hyundai, which controls over 75 per cent of the domestic market along with its affiliate Kia Motors Corp. (KSE:000270), sells the 3.8-liter Genesis for 58.3 million won (US$57,000) in Korea, whereas in the U.S. it sells for US$32,000.

That's good news for grey importers, who import goods legally but without the consent of the manufacturer, as well as South Korean consumers.

Even excluding the nation's punitive car-import duties, engine-displacement taxes and shipping costs, a Korean customer can save as much as 13 million won if he or she purchases a Genesis sedan that has been reimported to Korea from the U.S. market, auto importers say.

In addition, local buyers of models shipped back from the U.S. will benefit from Hyundai's 10-year, 100,000 mile warranty, which is only offered in the U.S., not Korea.

"As for Korean consumers, they could save big money if they buy the Genesis after it has been reimported from the U.S.," said Choi Jae-woo, a grey importer in Seoul.

Choi said he receives dozens of telephone and online queries a day from potential customers.

Since Hyundai announced details of its U.S. price range for the Genesis in May, disgruntled South Korean consumers have been abuzz with chatter on Internet sites about ways to reimport the vehicle from the U.S.

While there is no official data on how many of the sedans were reimported from the U.S., a TV news report on Tuesday by MBC, one of the nation's three major national broadcasters, revealed that one grey importer sold 40 of the vehicles to local consumers this month after buying them at American showrooms.

Amid rising consumer complaints, Korean anti-trust regulators are also investigating whether Hyundai and Kia have abused their domestic market dominance by charging higher prices at home.

An official at the Fair Trade Commission declined to comment, citing the ongoing probe. Officials at Hyundai's public relations team in Seoul weren't immediately available for comment.

Since entering the American market more than two decades ago, Hyundai has successfully raised its quality and consumer acceptance by offering generous warranties and affordable prices.

Still, critics say Hyundai's success in the U.S. market comes at the expense of South Korean consumers, who are being forced to pay higher prices than their American counterparts.

Hyundai was generating a profit margin of some 10 per cent on the Korean-built cars, compared with just two per cent for the same vehicles built in the U.S., according to industry analysts.

"With those kinds of margins to extort from Hyundai, it's no wonder the Hyundai Motor labor union desperately opposes open markets and the Korea-US Free Trade Agreement," said Brendon Carr, an American lawyer who has been working as a foreign legal consultant in Seoul for over 10 years, on his blog.

Hyundai's 45,000-strong union vigorously opposed a free trade deal signed by South Korea and the U.S. last year, which will cut car taxes and other non-tariff barriers on automobiles.

Hyundai began selling the Genesis sedan in the U.S. market last month. However, U.S. customers have given the new sedan a lukewarm response, with only Hyundai 649 models sold, according to the company data.

In comparison, Hyundai's domestic sales of the Genesis sedan averaged some 4,000 units each month for the first half of this year.

 

[bozzaj]

Hyundai began selling the Genesis sedan in the U.S. market last month. However, U.S. customers have given the new sedan a lukewarm response, with only Hyundai 649 models sold, according to the company data.

In comparison, Hyundai's domestic sales of the Genesis sedan averaged some 4,000 units each month for the first half of this year.

649 out of how many available? My local dealership got two, sold them in 3 days, and hasn't had any since - Checked on Tuesday.

 

[musher51]

"...the cooled driver's seat. I gotta have it!"

Rest assured...you're not the only one. I, too, absolutely HAD to have the cooled seat. As my nom de plume implies, I'm happier in -10F than +90F. To top it off, I grudgingly agreed to buy a black/black Tech car 'cause my dealer/brother-in-law was struggling to find the sapphire blue/beige with Tech that I preferred (but he made it worth my while with below invoice pricing...love that family discount!).

And I gotta tell ya...I LOVE the seat. It's been 90 and humid around here for a week, but it only takes a couple of miles for that seat to kick into gear and drop my misery level to nothin'. I only wish they hadn't cheaped out and limited it to the driver. I'd happily pay to have all four/five spots covered with that lil' technological marvel!

 

[Sal Collaziano]

It looks like Hyundai is selling a LOT of these cars in South Korea - and for a LOT more money than they're sold for here.. Very interesting.. It's also interesting to hear that at least 40 of the Genesis' sold here were shipped back to South Korea to those who refuse to pay the high cost over there.