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Car Forum / Driving, Maintenance, Tuning / Maintenance and Repair / July 2006Why do car manufacturers charge so much for replacement parts?
Hi group: I've been considering purchasing an old Geo Metro for commuting purposes because of the good gas mileage it gets. When I looked at a 1997 Geo Metro offered for sale in my area by a private party, he told me that he owned the car about 6 months and when he acquired it, he had to put a fuel pump in it. He said it cost him almost $700 for the repair job. At first, I didn't believe him but he explained that the fuel pump is inside the gas tank and that adds to the labor cost. To verify this, I visited a local Chevrolet dealer and their parts dept man said the new fuel pump was about $625. Their service writer said the labor to install the part was a little over $200 (almost 3 hours of R&R). I was under the impression that the Geo Metro was one of the most inexpensive cars offered by General Motors in the last 15 years. The service writer also told me that when it comes to any Geo Metro, the parts are very expensive. If so, why is the fuel pump so expensive; or in general, why are replacement parts sold by auto manufacturers so expensive? I'm angry at the oil companies for the high cost of gasoline and their high profits; and at the Arabs for the high cost of oil....but the high cost of replacement parts has nothing to do with a diminishing asset whose cost is expensive because there are less and less of them. Why does the management of auto companies (domestic and foreign), who probably go to church, temple or mosque every weekend, have to SCREW their customers continually with the high cost of replacement parts? I look forward to your comments. Regards, Al Gershen Grants Pass, OR gassyal@hotmail.com > Hi group: > [quoted text clipped - 37 lines] > Grants Pass, OR > gassyal@hotmail.com Because they can. That's called a free market...if you don't like the price then buy something else- if enough people do that then the price drops. This works for computers, beans, cars and yes, even oil. > Because they can. That's called a free market...if you don't like the > price then buy something else- if enough people do that then the price > drops. He's a Communist for wanting reasonable prices. > > Because they can. That's called a free market...if you don't like the > > price then buy something else- if enough people do that then the price > > drops. > > He's a Communist for wanting reasonable prices. lmao > > Hi group: > > [quoted text clipped - 13 lines] > > the labor to install the part was a little over $200 (almost 3 hours of > > R&R). If you haven't learned about dealers yet, you deserve the humping you will usually get. it's been said the repair work by a dealership is where the money is, not new / used car sales, dunno. >mho >v fe >drive 10% less, fill up when half-empty at >the lowest major station (help create a glut) > it's been said the repair work by a dealership is where the money is, > not new / used car sales, dunno. I had a relative or two in the auto business. (If they had been in the cattle business in the same way, they would probably have been strung up here in Texas;>) Sometimes, they claimed, they only made $50-200 on the sale of a car. BUT, the dealership gets a rebate for each car at year end, so this figure can some up a lot. Usually, they try to get your used car for nothing, if it is any good. They may also make money on the car loans, extended warranties, etc. And, if they charge $100 per hour for mechanics time, plus cost times about 3 or 4 for their parts, they probably make some money out of parts and repairs. If you can't get the part at NAPA, of course, they can jack the cost up even more. And if there is built-in obsolescence, it can yield even more cash flow. Nothing about the above is illegal. HLS@nospam.nix wrote in article <13ssg.118399$H71.45051@newssvr13.news.prodigy.com>... > > it's been said the repair work by a dealership is where the money is, > > not new / used car sales, dunno. [quoted text clipped - 19 lines] > > Nothing about the above is illegal. I worked for a year as a trainer for one of the "Big Box" home improvement stores. The "Big Box" stores work on margins of around 30 percent. They reach those margins by driving their vendors to cut costs - manufacturing in China is one way. Anybody who is dumb enough to believe that ANY business can stay in business by selling product at or near "cost" deserves to be taken. Unfortunately, the lesson seems to never be learned. Same goes for the businesses who "...make a mistake and buy too much inventory - OVERSTOCKED!!!" - yet it seems to happen on a regular basis. If you regularly buy more than you can sell - "forcing" you to "unload" stuff at or "below cost" - you don't stay in business very long. And, the leasing scam where they advertise ".....you don't have to worry about repairs...." Most leases - if you read the fine print - limit total mileage to around 36,000 miles - well within most vehicle warranty periods and under the 50,000 mile federally-mandated emission control systems warranty - so the leaser really doesn't have to worry about repairs either! If you bought the car, you would be as protected from repairs, and at the end of it all, you would have some equity for the money you have spent. Spend $12,000 over three years for a lease, and you have nothing at the end - other than paying for any mileage over the limit, and any perceptible damage. A couple of dings on a car that you own, costs you nothing! dunno. > Hi group: > [quoted text clipped - 37 lines] > Grants Pass, OR > gassyal@hotmail.com (delurking) Al, I just did this job on a '92 Olds Cutlass Supreme and a '93 Buick Century both within the last few months. It's not a bad job at all on either of those cars. Maybe 2 1/2 hrs. and I was taking my time. Just make sure to siphon all the fuel out of the tank you can as it will be too heavy to work with otherwise. I'm not saying it's as easy on a Geo Metro as it was on either of the cars I did, but I don't see how it could be all that bad. Just called Advance Auto Parts and they have that '97 Geo Metro pump for $132.88. The dealer is going to make money off his parts and labor, that's the business they're in and I really can't blame them. It's a competitive business. This is a job you can do yourself. Let the dealer do the things you don't have the tools or training for. I really don't think this is one of them. You might look into a subscription for that vehicle at www.alldatadiy.com if you decide to buy it. And no, I'm not affiliated with the website in any way. Just my .02. Garrett Fulton (relurking) > Hi group: > [quoted text clipped - 37 lines] > Grants Pass, OR > gassyal@hotmail.com I heard someone high up at Ford say they intended to make up for the low profit on vehicles with the higher prices on parts and also encourage people to replace vehicles sooner because of the cost of repair. All the manufacturers are doing it. I remember going in for a slip flange to repair a Festiva convertor. Ford wanted $65 because they could get it. I refused and went and machined my own. About all you can do is keep a spare vehicle for parts and do the work yourself. > I heard someone high up at Ford say they intended to make up for the > low profit on vehicles with the higher prices on parts and also > encourage people to replace vehicles sooner because of the cost of > repair. All the manufacturers are doing it. During the '50s, 90% of the profits made by the big three were through the sales of new vehicles. Now 90% of their profits are made by replacement parts and services. > Hi group: > [quoted text clipped - 18 lines] > service writer also told me that when it comes to any Geo Metro, the > parts are very expensive. Such a shock that a Japanese car has high priced parts. (Geo Metro = Suzuki Swift ) Just like every other import out there. > If so, why is the fuel pump so expensive; or in general, why are > replacement parts sold by auto manufacturers so expensive? Because the suppliers need to pay off the unions health and labor costs somewhere.... > I'm angry at the oil companies for the high cost of gasoline and their > high profits; and at the Arabs for the high cost of oil....but the high > cost of replacement parts has nothing to do with a diminishing asset > whose cost is expensive because there are less and less of them. Then stop driving your car and ride a bike, or walk. I don't see anyone holding a gun to your head to VOLUNTARILY buy those items. > Why does the management of auto companies (domestic and foreign), who > probably go to church, temple or mosque every weekend, have to SCREW > their customers continually with the high cost of replacement parts? Most of the repair parts you buy do NOT come from the manufacturers of the car. They buy the parts from a supplier just like you do. Very few parts are actually produced in house for any maker. Those suppliers are the ones who set prices for the repair parts not the management of the auto makers. > I look forward to your comments. > > Regards, > Al Gershen > Grants Pass, OR > gassyal@hotmail.com There used to be a "rule of thumb" as I was told - by the people at VW - that the replacement part cost something like 6 times what it cost at the assembly line. This was 40 years ago. I am quite certain the rates have gone up. Regards, Marv > Hi group: > [quoted text clipped - 37 lines] > Grants Pass, OR > gassyal@hotmail.com Marv Soloff <msoloff@worldnet.att.net> wrote in article <VPJkg.32983$mF2.4577@bgtnsc04-news.ops.worldnet.att.net>... > There used to be a "rule of thumb" as I was told - by the people at VW - > that the replacement part cost something like 6 times what it cost at [quoted text clipped - 4 lines] > > Marv In the 1960s, Pass & Weiss - the Boston-area distributor for Porsche and Volkswagen parts - built a VW Beetle from warehouse parts inventory. In those days, the Beetle went out of the dealership for around $1699. The one built out of inventory - and cost out at parts retail - went of more than $25,000! >Marv Soloff <msoloff@worldnet.att.net> wrote in article ><VPJkg.32983$mF2.4577@bgtnsc04-news.ops.worldnet.att.net>... [quoted text clipped - 6 lines] >> >> Marv >In the 1960s, Pass & Weiss - the Boston-area distributor for Porsche and >Volkswagen parts - built a VW Beetle from warehouse parts inventory. >In those days, the Beetle went out of the dealership for around $1699. >The one built out of inventory - and cost out at parts retail - went of >more than $25,000! Most of the cost is for warehousing and shipping. Unless you want to live inside a car manufacturing plant and only own cars under a year old, parts are going to reflect these costs. I suggest you buy 5 cars and keep them for replacement parts if you can't stand the concept of spare parts having shipping and warehousing costs. Of course, this will only make sense if you expect to have to replace every single part in your car. I'd prefer just buying the parts that fail. I'm even willing to pay a dollar for a 2 cent screw. It sure beats buying a hundred thousand dollars for spare cars. so they can charge retail for shop installed parts, and give a discount when necessary, maybe. >mho >v fe >drive 10% less, fill up when half-empty at >the lowest major station (help create a glut) maybe. |
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