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Old 05-18-2009, 01:59 PM   #1
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What does dealerships lose on GMS pricing?

I've search through numerous threads trying to find out wheather or not dealerships take a hit when honoring GMS. I'm a Credit Union Member and would like the GMS discount, but understand why I wouldn't receive it if dealerships get nothing in return. I've heard different stories about dealerships getting half the money back or 100 backs ect. Does anyone know the facts?

Scotty, I would love for you to put in your $.02
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Old 05-18-2009, 02:04 PM   #2
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He loses the difference between MSRP and the final price after getting back his money from GM. To the dealer, it's pretty much like getting invoice for the car.
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Old 05-18-2009, 02:06 PM   #3
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Originally Posted by qdz21 View Post
I've search through numerous threads trying to find out wheather or not dealerships take a hit when honoring GMS. I'm a Credit Union Member and would like the GMS discount, but understand why I wouldn't receive it if dealerships get nothing in return. I've heard different stories about dealerships getting half the money back or 100 backs ect. Does anyone know the facts?

Scotty, I would love for you to put in your $.02

also, Credit Union Discount and GMS are different............big time. GMS is Employee Discount.
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Old 05-18-2009, 02:10 PM   #4
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Hum I don't know if that money is flowing. From what I hear it's not, even parts & service money is supposed to be hard to get from GM corporate right now. There is no money for stuff.

Please correct if wrong.
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Old 05-18-2009, 02:46 PM   #5
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He loses the difference between MSRP and the final price after getting back his money from GM. To the dealer, it's pretty much like getting invoice for the car.

So the dealer gets absolutely nothing back? I've heard there is around a 1600 profit on these cars if sold at MSRP so if a dealership honors the Credit Union Discount and it saves me $1100 the dealership make $500 on the vehicle and get nothing from the Credit Union or GM?

Sorry for the redundant questions, I just want to make sure I understand this completely.
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Old 05-18-2009, 02:47 PM   #6
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also, Credit Union Discount and GMS are different............big time. GMS is Employee Discount.
Do you know what the Credit Union Discount might be?
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Old 05-18-2009, 03:02 PM   #7
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I emailed GM customer service about the discount and they said they did not know if it is available on the Camaro.....this was a few weeks ago......so even they don't know. I am a member of 2 credit unions and nobody seems to be able to say yes to any discount on this car.
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Old 05-18-2009, 03:29 PM   #8
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Its each dealers choice whether to honor employee or supplier discounts (credit union). As far as whether the dealer makes money on it is up for grabs. I have yet to read where a dealer gives us all the variable involved in such a transaction. So it is really hard for us customers to tell if they are making anything. I would suggest that they are making money on it but not much. Part of my rational behind this is that dealers seem to be very secretive about how much they make on these type of deals.

I dont see why it is so hard. Each program has its predetermined spread. Seems to me that it would be an easy figure to divulge.
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Old 05-18-2009, 04:02 PM   #9
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I emailed GM customer service about the discount and they said they did not know if it is available on the Camaro.....this was a few weeks ago......so even they don't know. I am a member of 2 credit unions and nobody seems to be able to say yes to any discount on this car.
shoot CamaroScotty a pm............he'll know. he posted an application to get the Credit Union Discount.
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Old 05-18-2009, 04:37 PM   #10
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I guess my answer wasn't accurate enough. Sorry.
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Old 05-18-2009, 05:18 PM   #11
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I think you explained tersely enough...........Moe.
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Old 05-18-2009, 05:29 PM   #12
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I emailed GM customer service about the discount and they said they did not know if it is available on the Camaro.....this was a few weeks ago......so even they don't know. I am a member of 2 credit unions and nobody seems to be able to say yes to any discount on this car.
One of my banks has a program, it was about 700 off of MSRP was the discount, I found a dealer that would do that discount or GMS, but my order just went to 3000 today, so im not changing.
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Old 05-18-2009, 05:30 PM   #13
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I was trying to get clarification on this as well with no success.

If the dealer makes $1600 on MSRP, then what I'd like them to do for me is let me use the GMS (as is should reduce their invoice), and then I will make up the difference in profit... they still get the $1600, and I get it below MSRP (although above GMS).

Where am I going wrong?
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1000, Dealer Order (4.06.09)
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3000, Order accepted by production control (4.21.09)
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Old 05-18-2009, 05:35 PM   #14
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I think you explained tersely enough...........Moe.
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Old 05-18-2009, 05:37 PM   #15
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So the dealer gets absolutely nothing back? I've heard there is around a 1600 profit on these cars if sold at MSRP so if a dealership honors the Credit Union Discount and it saves me $1100 the dealership make $500 on the vehicle and get nothing from the Credit Union or GM?

Sorry for the redundant questions, I just want to make sure I understand this completely.
Again, all of these GSU type deals bring the price to dealer as if he sold it for about invoice after all credits back from GM.

So, if the dealer were to sell at invoice (or GSU), he would lose the profit between that and MSRP.
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Old 05-18-2009, 06:24 PM   #16
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Use #'s please ... I am having a hard time following... and I am an engineer...

so if...

MSRP = $35,000
GSU = -$1,000
Customer Price = $34,000

Invoice = $33,000 (just a guess)

$33,000 < $34000 .... therefore, dealer doesn't get any rebate?
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Old 05-18-2009, 06:31 PM   #17
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This is how I understand it from talking to a friend that works at a dealership:

The dealer makes money on the following scale. The farther the discount from the top of the scale, the less profit they make. They have overhead costs, and for cars that sit on the lot, they also have interest expenses.


<---Above MSRP---->

<---Dealer Installed Options--->

<---Finance Incentives to Dealers/Extended Warranties/Undercoating/Etc--->

<---MSRP--->

<---GSU (Supplier), Military, Col, other Discounts--->

<---Invoice--->

<---GMS (Employee) (small rebate given back to dealer)--->

<---Dealer Holdback--->

<---Dealer volume discounts/rebates/special dealer incentives--->

<--Actual Cost--->


So, if a dealer sells at GMS or Invoice, they still make money on the individual car, just not as much. Depending on their overhead, and interest costs, lower volume dealers may loose money farther down the scale. Higher volume dealers generally have less overhead per car, because they are moving more units, and they may get additional incentives. That is why large dealerships may accept invoice or GMS pricing, while small dealers may not.
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Old 05-18-2009, 06:38 PM   #18
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GSU is not a specific rebate. It is a price on the invoice.

So, let's say MSRP is $35000.

Let's assume GSU is 33700.

Dealer loses $1300 by not selling it at MSRP. Simple.
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Old 05-18-2009, 07:21 PM   #19
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Originally Posted by RPO_Z28 View Post
GSU is not a specific rebate. It is a price on the invoice.

So, let's say MSRP is $35000.

Let's assume GSU is 33700.

Dealer loses $1300 by not selling it at MSRP. Simple.


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Old 05-18-2009, 09:53 PM   #20
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GSU is not a specific rebate. It is a price on the invoice.

So, let's say MSRP is $35000.

Let's assume GSU is 33700.

Dealer loses $1300 by not selling it at MSRP. Simple.
So if I understand correctly, the dealer eats all the cost of any of the discount plans issued by GM??? Why would a dealer ever accept one of these discounts? Are they just a ploy to make the buyer think they are getting a discount? If so, I should be able to negotiate the same deal with a dealer with or without a plan. I'm just confused, it doesn't make sense to me.
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Old 05-18-2009, 10:12 PM   #21
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So if I understand correctly, the dealer eats all the cost of any of the discount plans issued by GM??? Why would a dealer ever accept one of these discounts? Are they just a ploy to make the buyer think they are getting a discount? If so, I should be able to negotiate the same deal with a dealer with or without a plan. I'm just confused, it doesn't make sense to me.
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Old 05-18-2009, 10:16 PM   #22
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So if I understand correctly, the dealer eats all the cost of any of the discount plans issued by GM??? Why would a dealer ever accept one of these discounts? Are they just a ploy to make the buyer think they are getting a discount? If so, I should be able to negotiate the same deal with a dealer with or without a plan. I'm just confused, it doesn't make sense to me.
That's why it's the dealer's choice to accept it or not. If you have a car you can sell that's in high demand, it's like throwing money away if you can sell them all for MSRP.
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Old 05-18-2009, 10:21 PM   #23
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That's why it's the dealer's choice to accept it or not. If you have a car you can sell that's in high demand, it's like throwing money away if you can sell them all for MSRP.

You are right, except some dealers have committed to Supplier or Employee pricing back in October. They should honor the commitments they made.

-----------------------
Unfortunately, some dealers have gone even further. Why sell them at MSRP, when you can charge over MSRP?
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Old 05-18-2009, 10:32 PM   #24
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Yes, some dealers will agree to GMS pricing and employee pricing im sure in hopes to secure your business for years to come. Just like OTHER dealers will gouge your eyes for a 10k over MSRP price tag on a pre order. Both ends of the spectrum, go figure!
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Old 05-19-2009, 12:32 AM   #25
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That's why it's the dealer's choice to accept it or not. If you have a car you can sell that's in high demand, it's like throwing money away if you can sell them all for MSRP.
Got it, thx.
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