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I have a friend who works for a major automotive lead provider... She sent the following bullet pointed lists to me, and asked that I do not disclose her identity. She copied these lists out of an email that her company's newest VP (who came from True Car and worked directly for Scott Painter) sent to their internal team.
Select Affinity Partners (No-Haggle Auto Buying Program) – Zag traditional model – only premium dealers get these leads
Distribution Partners (TrueCar Price Reports)
I am posting this to the ADM Forum section to generate discussions around the topics referenced in each section and the bullet points that follow... What is your opinion or insight on the listed sections shown?
Haley Paglia has registered a special vanity domain and short-cut URL for the ADM Professional Community and assigned it to this Forum Discussion:
Please feel free to use this short-cut URL to refer people to this discussion and to get here without having to start at the ADM Showroom page...
I cancelled today. Feel strongly that dealers need to unite and stand together on this. Appreciate websites and communities like this where we as a dealer body can share things like this.
According to the WSJ article,
(CEO Scott Painter says that) TrueCar hopes to send car salesmen “the way of the travel agent.” Painter…says the slump in sales has resulted in discounts so steep that new cars can sometimes be less expensive than comparable used ones.
What Makes TrueCar Better?
TrueCar undoubtedly has a useful product, but why not use Edmunds.com or Kelly Blue Book to figure out a good price? According to TrueCar’s FAQ,
TrueCar is sharing the actual data itself, not opinions about what the price should be. We don’t have an opinion about price, we just show the truth. Others give statistical opinions of what is a fair price based on data, but they don’t expose the data itself. TrueCar also gives context to the numbers for the first time, by sharing the full range of prices people have actually paid.
Sounds good, but what makes the data itself special? I once again referred to the FAQ:
TrueCar aggregates data from dozens of sources – many of them proprietary and exclusive to TrueCar – and all highly confidential. TrueCar’s pricing data is currently calculated using roughly a quarter of all individual U.S. retail transactions per month. The company expects to expand that to close to half of all U.S. retail transactions by the end of the year.
How did TrueCar get its hands on exclusive, proprietary information? How much does that information cost the company, which is currently VC-funded? Are the number of sources along what make the data qualitatively superior to competitors, or is there more to it?
Slowly but surely TrueCar is getting what they deserve coming to them.
Actually the only benefit that I can see for TrueCar is the raising of the mini from the $150 - $200 range to the $300 for new and $400 for used.
All the salesmen who work for the 5000 or so TrueCar dealers should be going to the sales managers and GMs and getting this fixed now!
Orest - You bring up a great point that has been made by several others... How is it that TrueCar gets paid $300 for what is basically a "hand-shake TO" while the salesperson who does 95% of the work on the deal gets a $100 mini??? It seems like for $300 a deal, TrueCar should send reps to each of their 5,000+ dealers to do demo drives, write-ups and deliveries in order to earn that $300 sales commission they get...
This is WHY Scott Painter has said to remove the sales staff. TrueCar IS the sales staff, in his mind.
A Toyota Dealer Writes to me...
Jim, Thanks for stepping up concerning not only Truecar but all these other Internet pirates who have figured out a way to become car dealers without a franchise or any other of the costs involved in being a brick and mortar retailer.To me it is the electronic equivalent of just lurking around my dealership and greeting My customers when they arrive and then coming into the store with them under the pretense of protecting them from us in case we were going to try and make a profit.
They claim to have facilitated 235,000 car sales last year as if those cars wouldn't have been sold without them,and at least $299 per car ,they cost dealers over 70 million dollars in income.It seems that they find weak dealers who are incapable of selling cars in their own market and convince them by selling cars into everyone Else's at fire sale pricing that they will become more profitable.
I am a single point dealer who started as a car wash kid almost 50 years ago and have earned and built my store by the old fashioned way but I am not blind to the opportunities provided by the Internet and we use it everyday.
Paying these people a blackmail fee to keep them from directing my customers to a store who has "signed" up to be their delivery service is bullshit and then demanding customers proprietary information is just the tip of the iceberg.
Next they will be offering Financing services,extended warranty,certification for Pre-owned,and other sources of our income.I think the dealers that are signed up with these people should just add the 299 to the transaction price and pay their sales staff what they have earned.
In many cases the customer will show up here with the "TrueCar Deal" anyway and we will match it if we have to and I won't be paying them a nickel but I am sure that just helping the customer will be enough of a reward to them.
First the Manufacturers should get enough balls to stand up for the guys that invested millions of dollars in facilities and improvements to service their products.Some of the manufacturers and dealers are convinced that this the new way and we had better get on the wagon or be left behind but I am a car guy, we are successful because we have spent years developing relationships with our customers and I am not going to pay the overhead for people that intercept my Internet customers and then demand payment from us for negotiating "No Profit" transactions.
The customer can research invoice cost on any car without the TrueCar and like companies.Take back your store and stand up for yourself and the income of the employees that have helped build your companies.
Dealer Name Withheld