Is Toyota really looking to do direct sales

I saw a few articles about this. Closing a plant 1300 lose jobs that make the commercial truck.
I wonder how it would work with the dealers to provide
1) warranty work
2) certified trade in
3) add on things
4) parts sales

I think the dealers do deserve to lose new sales where they exceed MSRP and add add o s that are exceedingly expensive.

 

I've often wondered why some national-chain of warranty-work centers hasn't popped up in major metro areas.

In my model each center would have certified mechanics specializing in Toyota/ Ford/ Dodge/ ( etc ) -
I suspect you'd get better, and faster work out of a place like that.

These centers would back-bill the mfg leaving the dealer to do what they are supposed to do, sell sell sell and do
very minor maintenance. The reduction of their overhead could lead to lower prices for the consumer, but I doubt it.

 

no idea what you just said.

Dealers do not lose sales. They add a mark up. People pay the mark up. That is called a sale.

That is called a dealership.

 

Kids these days.

 

i'm trying to understand why.

how does it benefit toyota to skip dealers and deal directly with the customers? in almost every situation, it doesn't.

 

Dealers started to take too much.

 

take too much from who? not toyota.

and it's also not drastically damaging toyota sales-- they don't even have custom ordering, and sell every vehicle they build to their own predetermined spec.

again, why?

 

The dealership model is dead.

The quality of service they provide is abysmal.

Go do your oil change at the dealership and they will overtighten your wheel lugs, forget to fill up your oil correctly, and maybe even lose the center cap from one of your wheels and claim that it must’ve been you that did it. And charge you $120.

Warranty claims and warranty repairs are done half assed.

Dealerships don’t make a very good case for existing anymore.

They need to take a huge hit in the pocketbook and then be begging you for service and warranty claims instead of acting like you’re lucky if you get an appointment with a month.

 

It's bad enough that everyone in sales are liars and cannot be trusted, but service advisors too? I used to be able to find a decent service advisor. But when Covid and the lockdowns hit, almost all were furloughed. And then the service advisor positions filled up with liars - one guy admitted he used to be in sales. That was it for me - never went back. Screw 'em if you don't care about the customer. I was a three time repat buyer too. Screw 'em!!

 

I’m just going to list what happened with my 2013 4runner.

I’ve had service advisors show me a dirty air filter that clearly wasn’t from my truck and tell me that I need to pay them $60 to change it, plus the cost of the filter.
I’ve been told that all of my fluids look dirty and need to be changed even though the truck had brand new differential and transmission fluid and it was obvious they never looked.
I had a dealership charge me for changing differential fluid when the differential was never touched.
I’ve had a dealership refuse a warranty claim on the door locks because Southeast Toyota installed some type of aftermarket security thing, Southeast Toyota pretend they knew nothing about it when I took the claim to them.
I had to take the truck in three times for the airbag recall because they weren’t able to put the dashboard back properly, eventually they told me the huge lump that had appeared in it was normal.
When I had the steering rack go out, they didn’t do the proper procedure to bleed the air out of the system and I almost crashed driving home then they lied that I must’ve not been paying attention even though the problem went away after I bled the system myself.
They break and lose shit and then claim it was like that before I brought the truck in, this includes anything from wheels studs, center cap, valve caps, scratches and dings, etc.

 

So replace a full-service "dealership" with another entity that does everything but sell new vehicles?

 

Dealers are drastically damaging all automakers sales. Market "adjustments", BS fees, unpleasant buying experience, the list goes on and on. As of last week I've purchased two Teslas and it would take a pretty special vehicle to get me back onto a stealership's lot. I even live in a state where the stealers have bought the state legislature to attempt to keep direct sales illegal. Tesla's model of direct to the consumer is an absolute breath of fresh air. And, they provide service and repairs. The only difference I can tell is there are no pushy sales people and the buying process is as simple as clicking a few buttons on a web page.

 

I have a guy that I have been using for work on my cars that either I don't want to perform or that I don't have time for. I have been using him since 1999. He has his own shop, and I would say he is a master technician. I feel fortunate that I have access to him.

 

Just charge me what the dealer is paying and a $700 fee to drop it off near my house.

I don’t need any of the “additional services” dealers provide these days.

 

i'm not disagreeing on any of those things. the question i'm asking is "how does direct sales benefit toyota?"

toyota is already selling everything they make, for the price they define. and even better, each dealer is an entirely separate entity that deals with the customers, staffs themselves at no cost to toyota, handles warranty repairs, and gets their own private rankings. all without toyota needing to deal with the multiple locations, the staffing/HR issues, and essentially air-gapping the individual sales process from the toyota corporation--if anything goes wrong, toyota can easily release a statement about "this dealership made a mistake, doesn't meet our quality standards, etc." and they get to walk away as the hero for 'solving' the issue publicly.

in a direct sales model, they would be responsible for all of that crap directly, and why do they need that hassle?

you state that dealers are damaging automakers, but most dealers don't have extra inventory laying around on their lots. so can you better explain how dealers are damaging toyota?

 

When a dealer tells me I can’t buy a Toyota without paying them 15k over MSRP, they’re hurting Toyota because I’m not buying.

 

i get the frustration with dealers, and do everything in my power to avoid them, but how does the direct arrangement benefit toyota?

the arguments so far are from the individual purchase side. and on the purchase side, i agree.

but toyota is on the opposite side. the sales/production side. they're meeting their production goals. and if they're already meeting their goals, what benefit do additional sales opportunities create for them when they aren't making enough vehicles to fulfill those additional sales? is it really a 'lost sale' when no product exists to fulfill it?

 

Toyota had the opportunity to sell me, a lifelong customer, a Land Cruiser and a Lexus GX for my wife.

I’m going to keep my Tacoma and she’s looking at other brands.

I hope they’re fine with all the sales they’re losing.

 

A company the size of Toyota isn't going to worry about the crap of running a business, it comes with the territory. Let's say for sake of argument that the average new car deal makes the stealer 5% profit after all the expenses are paid. If Toyota could wave a magic wand and be rid of their dealers that 5% would go to Toyota. Now with all of those dealers out of the way they could consolidate the 1,473 (according to Alexa) dealers backend processes. There's got to be some savings there. Then if they went with a simplified lineup of vehicles (like Tesla's pick a model, pick a color, pick a tire size, done) that would reduce the cost of manufacturing. With a web based ordering system there is no need for commissioned sales people and all of the management they require. If I were Toyota I'd be absolutely salivating at the prospect of getting all the profit and savings back from the stealers.

Now as much as Toyota might like that it's never going to happen as long as state legislatures can be bought by the dealership organizations. Politicians are not about doing what is right for the average guy, they're about what's right for their pocket.

 

The dealers do mark ups are over $700. Plus you see that destination charge on the sticker… well now the destination is your house. If you look at any dealer. Markup a lot plus add things you might not want or want to overpay for. Example (ceramic coating. $1500) more examples but why bother point made