3 HN users recommended this explainer3 months2022–2024score 3.5
Years with an HN recommendation, 2007–2026
Offered as a well-researched counterpoint in threads complaining about car dealerships and direct sales.
FortNine explains the economics of the dealership model, arguing that dealers absorb inventory risk and help manufacturers' finances. It looks at whether cars and motorcycles could be sold more cheaply without them.
“Here is a well researched youtube video on the subject.” (HN, 2022)
Here is a well researched youtube video on the subject. [this video] And on that subject. What may be the best channel on youtube, amazingly well researched, written, shot, presented... and it's a(incredulous tone) motorcycle channel?!
This recent video on motorcycle dealerships argues that dealerships are beneficial for the financial arms of manufacturers and also manage risk due to warranty/recall work and sales flops. [this video]
Argues dealerships help manufacturers' finances and manage risk.
Just as a look at the other side: [this video] - The Stealership Trap - Why We Need the Dealership "Rip Off" This is for motorcycles but the jist of it is that the situation with dealerships is convenient to motorcycle manufacturers. I suspect it's semi applicable to cars as well.
Other side of the dealership model, from motorcycle industry.
It's mostly on the car manufacturers. Most of them seem to want the dealership model nowadays. There's no such laws in place requiring independent dealerships in Canada. Aside from the usual direct sales car companies, Genesis dealerships in Canada are all owned by Genesis Canada and I can order a car direct from Genesis. Yet most of the big names in cars operate with independent dealerships, as well as practically every motorcycle manufacturer as far as I know. In fact, Mercedes-Benz Canada just sold off all their Toronto dealerships to a AWIN/Zanchin [1] and AFAIK it wasn't because they were forced to. I don't have any real insight into why this is the case. Most I can say is that if direct sales was so lucrative for car makers, one has to wonder why they didn't take advantage of it here. That being said, FortNine released a video on why motorcycle dealerships work this way; I suspect a lot of it applies to cars as well: [this video] [1] [link]
Explains why motorcycle dealerships work this way.
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