03-17-2021, 03:29 AM
New bike sales have suffered under Covid-19. Assembly plants everywhere are affected by interrupted supply chain and irregular labor force patterns. Nobody is working at anything near full capacity.
Margins on new bikes aren't as large as you might think. For something like the NC, it's about 10%-12%. Aside from any inherent dealership overhead, freight and assembly and dealer doc are real expenses, though not as much as what you were quoted.
So, is a business allowed to make money on those expenses? Are plumbers and electricians allowed to make more on parts they carry on the truck than what he paid at Home Depot? Every business does this, no one incurs expenses without seeking compensation. It's like saying a bottle of beer at a bar should cost what it does at Bevmo.
We often think there are huge profits made by the dealer, such as when we see the MSRP of a 2014 CB1100 drop from over $10k to $6k. Not so. After a few years, Honda drops the MSRP on remaining unsold units drastically, and the dealer's cost too. Any bikes the dealer bought at the initial cost and is unsold if/when the price drops means he is largely upside-down on the bike.
Margins on new bikes aren't as large as you might think. For something like the NC, it's about 10%-12%. Aside from any inherent dealership overhead, freight and assembly and dealer doc are real expenses, though not as much as what you were quoted.
So, is a business allowed to make money on those expenses? Are plumbers and electricians allowed to make more on parts they carry on the truck than what he paid at Home Depot? Every business does this, no one incurs expenses without seeking compensation. It's like saying a bottle of beer at a bar should cost what it does at Bevmo.
We often think there are huge profits made by the dealer, such as when we see the MSRP of a 2014 CB1100 drop from over $10k to $6k. Not so. After a few years, Honda drops the MSRP on remaining unsold units drastically, and the dealer's cost too. Any bikes the dealer bought at the initial cost and is unsold if/when the price drops means he is largely upside-down on the bike.