Hi Katie, Where do you live?
Dana On Mon, 30 Jun 2003 17:44:25 -0700 (PDT), Katie Howell <[EMAIL PROTECTED]> wrote: > Car? I don't need no stinking car. I have a Huffy > one speed beach cruiser with coaster brakes. Of > course I have to spray it down with WD40 and replace > it every year because of the rust. I've only been > here two months and the handle bars are orange! > > Was in lurker mode while getting settled. How is > everyone? > > Katie > --- [EMAIL PROTECTED] wrote: >> <inline> >> >> > 1) Cars have a fairly large profit margin. >> True - even if you see the "invoice" price the >> manufacturer "charges" >> the dealer for the car, there are "incentives", >> "holdbacks", "promotions" >> etc. which go to the dealer by back channels. So the >> dealer is still making money even selling near "invoice", and the >> wholesale >> price from the mfg to >> the dealer has a lot of profit for the factory. >> >> > 2) At this point in the economy, auto >> manufacturers care about moving lots of > cars. >> True - also at this time in the model year, and time >> of the month. >> Note that the 2004 models are on the way, and they >> need to move existing >> inventory to make room and get money to pay factory >> for more. >> Plus, dealers typically finance their inventory - >> called "flooring" as it >> puts a floor under the cars. If they can move the >> car by the end of the month, they might save a month's "flooring" on it. >> >> > 3) Having cheap interest rates entices people to >> buy new cars. >> Worked for me! >> >> > 4) The amount of cars being sold outweighs the >> loss on lent money. >> True. >> >> > 5) Only the best customers get the "1.9%" interest >> rate. Everyone else gets > gouged. >> Yeah, they said you had to have "Tier 1" credit to >> get that (which I do). >> >> It may not be fair, but if you have money you can >> save money! >> >> -Ben >> >> >> > > ----- Original Message ----- >> > From: jon hall <[EMAIL PROTECTED]> >> > Date: Monday, June 30, 2003 5:31 pm >> > Subject: Re: New car >> > > > Ok...forgive me if this is econ 101, but I got >> another one :) >> > > > > So in essence the lending branches of the auto >> manufacturers are not >> > > traditional banks in that banks borrow money >> from the government, and >> > > these guys lend money out of their own >> pockets...so they do not have >> > > to worry about the prime rate. >> > > > > Wouldn't they still be vulnerable to inflation >> though? I mean...if >> > > they loan money out at 1.9%, and inflation >= >> 1.9%, the the real money >> > > that the car buyer is paying for the car is >> actually amounts to >> > > less than the sticker price + interest rate...or >> not? >> > > > > If I'm not way off base...my whole line of >> thinking is that the auto >> > > manufacturers are betting that inflation remains >> in check for at least >> > > the next 4 years...and for inflation to remain >> in check, there can not >> > > be a big economic improvement...which usually >> from what I've read, >> > > will cause inflation to rise until the Fed >> checks it with interest >> > > rate hikes. >> > > Even if inflation is about 1.9% for the next 4 >> years...doesn't that >> > > make the lending branches of these companies a >> lot less profitable, >> > > meaning they have to raise prices on the >> cars...meaning the inflation >> > > rate goes up even more if we get too fast an >> increase in > > inflation, or >> > > it stay too high too long? >> > > > > Good god...this stuff is confusing :) >> > > -- > > jon >> > > [EMAIL PROTECTED] >> > > > > Monday, June 30, 2003, 6:52:02 PM, you wrote: >> > > CG> Your understanding would be correct if it >> was straight > > financing, but it > > CG> isn't, so,well,it isn't. >> > > >> >> > > CG> These are promotional rates and have nothing >> much to do with > > actual intrust > > CG> rates like the "prime" rate >> and the >> overnight rate. They are > > usually funded > > CG> by the manufacturer, >> but usually the dealer >> has to kick in > > something as > > CG> well. Most of the big auto >> companies have >> their own lending > > arm, and,oddly > > CG> enough, it is often the >> most profitable part >> of the company. >> > > > > CG> There is no line relationship between >> interest rates and > > inflation. >> > > CG> Cary Gordon >> > > > > CG> At 06:16 PM 6/30/2003 -0400, you wrote: >> > > >>Congratulations :) >> > > >> >> > > >>I want to branch a little though...isn't 1.9% >> less than inflation? >> > > >>Doesn't that mean that over time, if interest >> rates rise, they > > will be >> > > >>making less money? Especially considering the >> fact that with all > > this>>built in economic stimulus...we are bound >> to see a really > > big uptick >> > > >>in inflation if/when everything starts to turn >> around. >> > > >> >> >> > > >>Or is my understanding of how this works >> incorrect? >> > > >> >> > > >>-- >> > > >> jon >> > > >> [EMAIL PROTECTED] >> > > > > > > CG> > > > >> > > ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Archives: http://www.houseoffusion.com/cf_lists/index.cfm?forumid=5 Subscription: http://www.houseoffusion.com/cf_lists/index.cfm?method=subscribe&forumid=5 Your ad could be here. Monies from ads go to support these lists and provide more resources for the community. http://www.fusionauthority.com/ads.cfm Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=89.70.5
