Dealer markups set for a comeback?
A repeat of 2008’s dealer add-ons coming?
Over the weekend instability in the Middle East pushed oil prices to levels not since 2008, one of the worst years ever for the buyers of hybrid cars.
Back in 2008 it wasn’t uncommon for dealers to add $3000 – $5000 markups to the price of a Toyota Prius, while also adding dealer upgrades such as leather and other expensive amenities. Is history set to repeat?
In the last few weeks there have been several stories in the press noting that many dealerships have witnessed an uptick in interest for fuel efficient vehicles. Fortunately, demand is still below supplies.
However, the situation in North Africa and the Middle East threatens oil price stability far more than what was experienced this weekend. If for instance, Shi’ite protests in Bahrain and Yemen spread to Saudi Arabia, significant speculation in the oil markets should be expected. Such instability in Saudi Arabia could provide perfect cover for an attack on Saudi oil production and/or refinement – a move that wouldn’t just set oil prices on fire, but would probably crush the US economy into depression (these are ideal times for the likes of bin Laden).
So, if you’re in the market for a hybrid, but have been holding out for a deal. Today’s prices might be the best deal for a while.