Do you need allocation?
Thread Starter
Instructor
Joined: Mar 2013
Posts: 103
Likes: 6
From: Fresno, Ca
Do you need allocation?
My local dealer told me that they didn't need an allocation if I was going to order the car. Chevrolet would automatically accept all special orders as long as I was a committed buyer. Is this true? They are a small dealer and this is their first year that they are selling Corvettes. They did have a Stingray on the floor. Cecil........
Le Mans Master
Joined: Jul 2013
Posts: 5,191
Likes: 3,388
From: Morrill Nebraska
My local dealer told me that they didn't need an allocation if I was going to order the car. Chevrolet would automatically accept all special orders as long as I was a committed buyer. Is this true? They are a small dealer and this is their first year that they are selling Corvettes. They did have a Stingray on the floor. Cecil........
Safety Car
Joined: Nov 2012
Posts: 4,737
Likes: 551
From: North California
Sounds like a dishonest dealer to me. There is no such thing as a special order. Sounds like he doesn't have allocation but wants you to either put a deposit or stick with him for a long wait.
There are dealers out there that won't mind having you wait for a 2016 model. Don't fall for it. There are plenty of dealer allocations left for an early 2015 run.
There are dealers out there that won't mind having you wait for a 2016 model. Don't fall for it. There are plenty of dealer allocations left for an early 2015 run.
Race Director
Joined: Sep 2000
Posts: 11,143
Likes: 1,913
From: Missouri City, TX
Sounds like a dishonest dealer to me. There is no such thing as a special order. Sounds like he doesn't have allocation but wants you to either put a deposit or stick with him for a long wait.
There are dealers out there that won't mind having you wait for a 2016 model. Don't fall for it. There are plenty of dealer allocations left for an early 2015 run.
There are dealers out there that won't mind having you wait for a 2016 model. Don't fall for it. There are plenty of dealer allocations left for an early 2015 run.
No corvette gets built for a dealer regardless of whether it is a Sold or for Stock order without a specific allocation given to the dealer by GM.
Jukebox Graduate
Joined: Jun 2014
Posts: 857
Likes: 3
From: Saint Louis MO
More likely they hope that if they could obtain a firm buyer with deposit they could leverage your commitment to procure an allocation from their zone rep/GM. This might even work, but it's not a very good place for you to be waiting on a car that could never arrive. And if you want a Z06 there are other options to getting one from a dealer with an actual allocation.
Advanced
Joined: Jul 2014
Posts: 78
Likes: 3
So if a new dealership opens up in a small town and has never sold a corvette. How would they ever get an allocation for a vette since you must first sale some in order to get allocations?
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
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Safety Car
Joined: Nov 2012
Posts: 4,737
Likes: 551
From: North California
The dealer should be able to make money on the deposit. First, the dealer can cash the check and invest it. It's not just your $8K it's many people's $8k over many generations of cars. It adds up! Two, the dealer will make money if your car gets built but you cannot or do not want to pay for it. Easy cash.
The dealer network should also be able to make money off the allocation program. If I were able to buy my Corvette from a local dealer, as I should be able to, I wouldn't have to pay for courtesy delivery. What is courtesy delivery if not you paying the dealer network the allocation fee?
The dealer network should also be able to make money off the allocation program. If I were able to buy my Corvette from a local dealer, as I should be able to, I wouldn't have to pay for courtesy delivery. What is courtesy delivery if not you paying the dealer network the allocation fee?
Le Mans Master
Joined: Sep 2000
Posts: 5,027
Likes: 320
From: N. CA
So if a new dealership opens up in a small town and has never sold a corvette. How would they ever get an allocation for a vette since you must first sale some in order to get allocations?
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
It is not able to get an allocation for the high end z06 Corvette. That new dealer simply needs to sell lots of Stingray's then they will be in a position to get an allocation for the Z06.
Z06 alloctions are based upon Stingray sales!
Jukebox Graduate
Joined: Jun 2014
Posts: 857
Likes: 3
From: Saint Louis MO
The dealer should be able to make money on the deposit. First, the dealer can cash the check and invest it. It's not just your $8K it's many people's $8k over many generations of cars. It adds up! Two, the dealer will make money if your car gets built but you cannot or do not want to pay for it. Easy cash.
The dealer network should also be able to make money off the allocation program. If I were able to buy my Corvette from a local dealer, as I should be able to, I wouldn't have to pay for courtesy delivery. What is courtesy delivery if not you paying the dealer network the allocation fee?
The dealer network should also be able to make money off the allocation program. If I were able to buy my Corvette from a local dealer, as I should be able to, I wouldn't have to pay for courtesy delivery. What is courtesy delivery if not you paying the dealer network the allocation fee?
How do you think they invest this illicit deposit money to make their fortune? Certainly, it would have to be more than what any bank pays these days because even $1M invested in a bank account would earn little more than $4500 in a year. And no one would rip off hundreds? Thousands? of innocent wood-be buyers for so little gain. The ponies? The market? Pork bellies? OMG! I've got it! This dealer is the front for a drug cartel! Good thing OP didn't put down a deposit.
Safety Car
Joined: Nov 2012
Posts: 4,737
Likes: 551
From: North California
I didn't realize this "dealer" was actually a crime syndicate parlaying hundreds of thousands (millions?) of dollars of the gullibles' deposits money into untold profits. You're a much closer reader than I because I didn't get any of that from the OP.
How do you think they invest this illicit deposit money to make their fortune? Certainly, it would have to be more than what any bank pays these days because even $1M invested in a bank account would earn little more than $4500 in a year. And no one would rip off hundreds? Thousands? of innocent wood-be buyers for so little gain. The ponies? The market? Pork bellies? OMG! I've got it! This dealer is the front for a drug cartel! Good thing OP didn't put down a deposit.
How do you think they invest this illicit deposit money to make their fortune? Certainly, it would have to be more than what any bank pays these days because even $1M invested in a bank account would earn little more than $4500 in a year. And no one would rip off hundreds? Thousands? of innocent wood-be buyers for so little gain. The ponies? The market? Pork bellies? OMG! I've got it! This dealer is the front for a drug cartel! Good thing OP didn't put down a deposit.
For billionaires like yourself it is chump change. Put that in contrast with the average U.S. family net worth:
http://en.wikipedia.org/wiki/Wealth_in_the_United_States
In 2007, the average family net worth when the head of household was aged <35 was 10.7 thousand dollars. That's roughly what Kerbeck is asking as a deposit.
Burning Brakes
Joined: Aug 2009
Posts: 1,073
Likes: 43
From: Camdenton Missouri
My local dealer told me that they didn't need an allocation if I was going to order the car. Chevrolet would automatically accept all special orders as long as I was a committed buyer. Is this true? They are a small dealer and this is their first year that they are selling Corvettes. They did have a Stingray on the floor. Cecil........
Sorry. I just couldn't pass it up. Takes many, many stingray sales to get one z06.
Thread Starter
Instructor
Joined: Mar 2013
Posts: 103
Likes: 6
From: Fresno, Ca
Burning Brakes
Joined: Dec 2007
Posts: 967
Likes: 6
From: Downers Grove IL
My only point was that the dealer "should be able" to make money from the allocation and deposit system. For most other people making more money off doing the same amount of labor and investment is a good strategy.
For billionaires like yourself it is chump change. Put that in contrast with the average U.S. family net worth:
Wealth in the United States - Wikipedia, the free encyclopedia
In 2007, the average family net worth when the head of household was aged <35 was 10.7 thousand dollars. That's roughly what Kerbeck is asking as a deposit.
For billionaires like yourself it is chump change. Put that in contrast with the average U.S. family net worth:
Wealth in the United States - Wikipedia, the free encyclopedia
In 2007, the average family net worth when the head of household was aged <35 was 10.7 thousand dollars. That's roughly what Kerbeck is asking as a deposit.
My dealer asked for a 1000 refundable deposit.....the z06 first year production will be maybe 1500 cars and spread that out over hundreds of dealer a big Corvette dealer may get 30-50 cars......maybe, if they sell hundreds of stingrays....the current rate on a CD is 1.5- 2 % return...I just refinance my house at 3%...taking in a hundred allocation deposits would be lets say 100-200k. deposit that into a CD and the return is 3- 4 thousand dollars....over a year.Now take into consideration of managing a 100 orders for customer, the accounting of the money for the benefit of the IRS, plus internal administrative maintenance of those funds. This is not money you can go day trading with and hope to hit it big. Anytime a customer wants it back you have to return it. so it has to be liquid at all times and what exactly is your point of average American net worth have to do with anything ? It's a 100k car....the average American home
is at around 170k. WTF does that have to do with anything ? when we are talking about a 100k car that's not even practical transportation ?
Burning Brakes
Joined: Dec 2007
Posts: 967
Likes: 6
From: Downers Grove IL
So if a new dealership opens up in a small town and has never sold a corvette. How would they ever get an allocation for a vette since you must first sale some in order to get allocations?
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
I don't understand the procedure. Why not just build what ever that dealer orders. I have to travel over 3 hours past numerous dealers just to talk to someone that I have never done business with. They already have loyal customers that they put in the front of the list. This will be my first vette if I'm lucky enough to find one on the lot. I've purchased over 17 new vehicles from my local dealer but since he has never sold a corvette(well maybe 3) in the past 10 years he can't get one.
Burning Brakes
Joined: Nov 2009
Posts: 860
Likes: 38
From: Everett WA.
Same thing happened in 01 & 02 when the C5 Z06s were introduced. Dealers could only order the Z06 if they had allocations which were given based on prior general Corvette sales. Still, some dealers took deposits without allocations in the hope they could secure one from other dealers that had them. Lots of unhappy customers back then that sometimes waited for months before getting their deposits back.
Race Director
Joined: Sep 2000
Posts: 11,143
Likes: 1,913
From: Missouri City, TX
I assume GM has special rules for new dealerships that have just opened. However in the case of high interest limited production vettes; ie Z06 & ZR1 for example, that new dealership would have to sell a certain number of regular vettes over a period of years before they qualified for allocations for the limited production cars.