Cost of spare parts - how long will the scam last? - Rattle
Is it any wonder some brands are not selling when they have been ripping of customers for years with parts?

On technical now somebody has been quoted £320 from a dealer for a new throttle position sensor, now I am no mechanic but I do know about electronics, and surely all the TPS is a potemeter which changes the resistance according to the position of the cable?

Also if its anything like the one I removed from my old car it is a very simple job to replace.

A 500gb hard drive now costs £40, these are quite complicated, a motherboard costs £40 and is very complex compared to an ECU which is actually a very unpowered simple computer running a fairly simple computer prgram (compared to what we use on our PCs).

So how can they charge £1k for an ECU? £300 for a TPS etc? I understand cats are expensive because they require a lot of metal and a lot of engineering is involved in the manufacturer but I get mad when people are forced to pay £100's for a very simple part on a fairly modern car.

£160 for a clutch and bearings including labour and to it the gearbox needs removing etc, how can a TPS cost £320?

What also gripes me is dealers who charge £50 for an ECU scan which is fair enough if they know what it means, but half the time they seem to be oh it says you need a new TPS, but it turns out to be the wiring to it, surely you're paying £50 not to let a mechanic do some basic work but for a person to actually diagnose the readouts properly?

Another daily rant from HJ's young Victor Meldrew.
Cost of spare parts - how long will the scam last? - quizman
Rattle, you are correct about the throttle potentiometer being overpriced.

My John Deere throttle potentiometer was replaced just outside the warranty. They wanted over £100 for the part. My son, who is in electronics, looked at the part number and told me he could get it for under £10!

Yes we will get ripped off, if we let them.

Victor Meldrew is another of my heroes, I love a good moan.
Cost of spare parts - how long will the scam last? - Old Navy
Rip off Britain is alive and well!
Cost of spare parts - how long will the scam last? - Hamsafar
I agree. You can buy a new laptop for under £320!
Cost of spare parts - how long will the scam last? - Rattle
It puts me off running a new car, because if I bought one, and then needed a new TPS, if there wasn't any in the scrappy I would be forced to pay this kind of money. I actually think car manufacturers make money from spares than they do from the car itself.
Cost of spare parts - how long will the scam last? - Old Navy
It seems to be standard to sell hardware cheap, but the consumables to run it expensive. Razors, printers, electric toothbrushes, etc........
Cost of spare parts - how long will the scam last? - Ian (Cape Town)
OldNavy, but consider the poor dealer (Ok, 'poor' isn't a very good word...) ... He has to buy all those nuts, bolts, window opening handles, light fittings, electronic bits etc. BUT is he guaranteed he can sell them this year. Or next?
BUT he has to have stock in case somebody asks for one.
Meanwhile, he's shelled out, and the thing is gathering dust.

NOT that it makes it less painful, but that's the reality.
Cost of spare parts - how long will the scam last? - FotheringtonThomas
consider the poor dealer (..) he has to have stock in case somebody asks for one.


Is that really true? Don't they just order them in from a depot as required?
Cost of spare parts - how long will the scam last? - TheOilBurner
I used to specialise in writing Dealer Management Systems, in particular software for Parts Depts.

I can assure you, they don't keep absolutely anything in stock which doesn't move quickly, even then they'll keep the minimum they can. Anything expensive hanging around for weeks or months on end will result in the Parts Manager getting a stern ticking off at the very least.

The software is designed to ensure that the dealers can help identify demand so that only the most wanted parts are kept in stock and only in the quantities required.

There are of course exceptions, but not often.
Cost of spare parts - how long will the scam last? - Mike H
BUT he has to have stock in case somebody asks for one.
Meanwhile he's shelled out and the thing is gathering dust.


That's the ironic part - they've never got the bit you want in stock! Do dealers keep big stocks these days? I doubt whether they keep anything other than the commonly needed items on the shelf, so nothing much gathers dust.
Cost of spare parts - how long will the scam last? - Ian (Cape Town)
Certain bits, whcih go wrong once in a blue moon, will be on their shelves.
Or at the depot. where they gather dust.
These are the bits which still have to be paid for...

Yes, horrid thought. But that's the reality.
But referring to other answers - many blokes just replace, don't fix. If you have some bloke with a soldering iron and a basic knowledge, he could probably do a fix. But that would kill the goose, wouldn't it?
Cost of spare parts - how long will the scam last? - rtj70
When cars of mine have had problems and needed parts, the dealer has almost always had to order the parts in (e.g. EGR valves and boot lock on a Mondeo). They tend to keep in items that get used often.

As for the cost of the part though, if it's a genuine one then it might be the car/component manufacturer making a lot of the profit. Somewhere someone has stockpiled parts in case they are needed even when the car is no longer made. Or additional runs are needed to make new stock.

If a laptop or a PC broke in two year's time and needed a new part chances are you won't get it. Try getting a brand new 939 pin Athlon 64 CPU. And then if you swap the CPU, you need a new motherboard, RAM and maybe graphics card and hard disks (SATA connections used now).... in the car world you'd not be happy when you find out the replacement door handle needs four new doors as well ;-)

Comparing mass produced items like laptops or even a humble hard disk is not the same as car parts that are unique to a particular model. If my hard drive went I'd get a new one that would be cheaper, quicker, bigger than the old one. If the gearbox in a car went you cannot just drop in a standard gearbox from any old company....
Cost of spare parts - how long will the scam last? - Rattle
I understand that, but the profit margins are still excessive, and why can't they standardise more parts? Ford are very good at doing that, they have a fairly small amount of engines that fit into several parts. My car has two Transit parts fitted and they are both identical to the original.

I guess a laptop can be compared to a car, because apart from the hard drive and RAM most parts are unique to that system. I had to right off an IBM Thinkpad I used to own because it needed a new battery and cooling fan.

I also carry a large amount of obscure computer parts, I have bits unique Dell chasis fittings etc, but I charge £25.00 to fit and supply 1GB DD2 RAM if it is a regular customer because I like to look after them, people then come back to me with other problems as they know I don't rip them off. I've even had people coming a long way to me.

Don't these dealers realise that if they were always 100% honest, and they had a realistic and not excessive margin on their parts people would keep going back to them to buy cars from them. This is the reason I believe so many FIAT dealers go under, because they didn't offer the customer service.

Getting hold of older PC parts is getting a pain, my parents PVR needs a new hard drive and its a flipping IDE one, I just cannot get one at a realistic price anymore.

£200+ though for a part that costs pence to make and dosn't require much research is a rip off.
Cost of spare parts - how long will the scam last? - Falkirk Bairn
Spares are a rip-off in most industries.

Many years ago a major PC company had a spare that was 50% of teh cost of a complete unit.

How

Purchase price from supplier $20
Inter Company billing price - $xx
Change $$$ to £££ s= £xx (1:1 although it was £1 =$2.2 at that time)
Add Freight @ 20% = £1.2(XX)

Then multiply by 7 for the Spares Price-

$xx became £8.4 (XX)
$20 ex supplier in USA became £760 + VAT
Cost of spare parts - how long will the scam last? - mikeyb
I work in the aerospace industry - most of the spares are a multiple of the price we buy in at - usually at least 3.5 times......However, we bear the cost of development / R & D etc which is mega bucks, and if we didnt make profit in this area then there would be no future development for new aircraft, and in reality my employer wouldnt exist as an airframer. Incidently in this industry the airframer who takes most of the risk makes less than the operators and the airports!
Cost of spare parts - how long will the scam last? - rtj70
Rattle, with 1GB DDR2 memory starting at about £8 you charge £17 to fit? But this costs you to get to them, to procure the part (you need to make sure it's the right type). So you might be underchargingR for this service IMO.

Edited by rtj70 on 19/12/2008 at 18:46

Cost of spare parts - how long will the scam last? - Fullchat
What annoys me is that as parts departments seem only to stock fast moving consumable everything else is ordered on demand. Fair enough.
But a visit for parts will inevitably result in a next day or soon after delivery. Unless you have established a relationship with your parts person two trips are involved. Often necessary to describe the exact part you require by reference to the parts catalogue.Time consuming and extra expense of fuel. Indeed some impact on global warming.
Now if the catalogues were on line??????
Cost of spare parts - how long will the scam last? - Rattle
It depends on the PC, if its a motherboard or a PC I know well and there will be no configuration offer then it is only a five minute job. It probably is a bit too cheap but very often its part of the same visit, so I may tune their PC and then say youhave Windows Vista Premium and only 1GB of RAM so another 1gb will make a difference. Most my jobs are within 10 minute walking distance. The only problem with this is it has become a bit of a habbit, so I have too many £17 profit jobs atm.

I admit in the past this plan has gone a bit wrong, and I've had to go all the way to Microdirect (which is a good 25 minute drive away) just to get the RAM, I only try and co-ordinate my visits though. I just like to compete with the computer shops who only charge £10 to fit RAM, but then they usualy sell the RAM for more than what I charge my customer.
Cost of spare parts - how long will the scam last? - rtj70
Didn't want to hijack the thread though just wanted say you might be working too cheap. Luckily for me, Microdirect opposite the biscuit factory is 5 minutes away ;-) I remember when it was where the Aldi on the A34 near Burnage is (an old cinema).
Cost of spare parts - how long will the scam last? - ForumNeedsModerating
Manufacturers know, more or less, exactly how many of which part will be required over a model lifetime (including the legacy period when the model is no longer made, but still in circulation). From this they make or contract out to make that number - theoretically, when the last Model X by manfr. Z is on its last legs the final part ordered for it will be the last part anywhere. So the idea of warehouses full of obscure & unsued parts gathering dust is (or should be) false.

I quite often slag-off my Mercedes, but one thing they do well is stock parts & have a good quick & efficient ordering procedure - I can phone up today, verify a part number & have it delivered next day. Maybe though with my vintage of Merc that's a good thing!
Cost of spare parts - how long will the scam last? - the swiss tony
I do have to laugh at these comments sometimes......

lets try and clarify a few points about car parts....

1/ profit on parts (at dealer lever from manufacturer)
major units.. engines gearboxes etc... no more than 7%
run of the mill parts.... 20%
service parts ...40%

compare that to clothing in the high street @.....200% - 600%!

2/ Stock availabilty
parts departments often have a top 100 list of parts they HAVE to stock, whether they sell or not...
other than those parts, you really need to sell 4 or more a year for a part to be worth keeping in stock.
dont forget, rates have to be paid on every square metre, so profit has to be made to cover said rates, as well as keeping the parts in good condition, counting them at stockcheck etc....

again compare that to retail shops where stock turn would be 100 plus a DAY! (how often are supermarket shelves refilled?)

3/ looking up the correct parts is in fact a skill... not only do you have to understand exactly what the customer needs, which isnt always what they ask for... you have to know a part under lots of different names, or even just a poor description ' I want that silver thing, thats just behind that black round thing by the top hose....'
Then you have errors on the parts info (EPC... Electronic Parts Catalogue)
parts can be listed in strange places... the list goes on....
(BTW EPC's can be found online these days.....)

4/ Parts people are not the highest paid people by a long chalk - but they are expected to be skilled, work long hours, often 6 days a week, understand customer needs, give technical advice, and take the flack when the part isnt on the shelf!
Cost of spare parts - how long will the scam last? - jbif
I just like to compete with the computer shops who only charge £10 to fit RAM, but then they usualy sell the RAM for more than what I charge my customer.


Rattle,

apart from your old Fiesta, what other business overheads do you have?
Can you say approximately how much those fixed costs amount to per year?
Do you have a public liability insurance policy and/or otehr business insurance policies? How much do you pay for that?
I also carry a large amount of obscure computer parts, I have bits unique Dell chasis fittings etc

Where do you store those spares? Does your home insurance cover you for it? Is your home council tax baseed on business use?
Are you a sole trader?
Are you registered for VAT?
What gurantees do you give in respect of parts & services?
etc. etc.

Cost of spare parts - how long will the scam last? - Rattle
Why?

I ama sole trader, not VAT registered just pay income tax and NI. I also have public liability insurance which is fairly cheap. My other costs are phone bills, advertising, travel etc. I give 12 months warranty on new parts, 12 months labour on hardware and upto 3 months on software depending on what the job is.
Cost of spare parts - how long will the scam last? - jbif
I also have public liability insurance which is fairly cheap


Rattle:
How much is that?

How much is your home insurance policy for storing business parts at home?
Do you pay business rates on your home? How much?
Are your mortgage providers aware that you are using your home for business storage?
Does your car insurance polciy cover you to carry parts in your car? How much extra does that cost you?

It is hard to believe that with your expertise/experience, expert knowledge, degree in computing, etc. that you can only charge so little for your time, and yet make a profit after allowing for all the overheads that you must be carrying. [You said in another thread that with your charges undercutting the Techguys, you can only afford to run a car on bangernomics. ]

p.s. - I agree with swiss-tony.

Edited by jbif on 19/12/2008 at 21:15

Cost of spare parts - how long will the scam last? - Rattle
I did used to charge more, but with the credit crunch I seem to be charges less but I have a lot of work so I would rather have a big pool of customers in times like this it reduces the risk. Mortgage company are aware, and as only a small proportion of the back room is used for business and a little cupboard in the shed business rates don't apply.

Also my car insurance company are aware of my business and what my business is, which allows me to carry any item connected to my business. I am not sure how much extra it cost, as I just told them my details and they gave me a quote which I accepted. However I am 26, paying £880 a year with 1 years NCB fully comp (it was no more expensive than standard but allows me to drive any car with owners permision).

I have been looking into getting a very very small retail unit for repairs and selling the basics but there is never any small units availible even in the current conditions all the small shops are taken and it would only work in my local area as that is where I have a good reputation.

I could afford a brand new car if I wanted, but then I would have to stop going out every weekend, I would never have a holiday etc.

The big problem is now I have a lot of older customers who will phone me and ask me to teach them how to scan something, often it will only take 5 mins and I charge them £10. If I suddenly put my prices off it would put them off phoning me.

Once I have more driving experience there is a few jobs I have thought about applying for.

Anyway the thread is getting a bit off topic now, buit the idea of having a car was to reach more customers and save time, so far the opposite has happened!
Cost of spare parts - how long will the scam last? - Mr X
Which dealer is that, I'd love him to be mine. All I've ever heard from the parts departments of dealers is ' Will be in by tomorrow afternoon. Would you like to pay for it now " ?
Cost of spare parts - how long will the scam last? - Armitage Shanks {p}
Quite correct Rattle! When I earned a living selling military aircraft the rule of thumb was that an aircraft costing £X Million would need spares worth £4X million during its working life.
Cost of spare parts - how long will the scam last? - freddy1
Quite correct Rattle! When I earned a living selling military aircraft the rule of thumb was that an aircraft costing £X Million would need spares worth £4X million during its working life.



When I first read that , I thought you worked from home , and just kept a stock (of the planes) in your garrage , for immewdiate delivery!
Cost of spare parts - how long will the scam last? - Kevin
>an ECU which is actually a very unpowered simple computer running a fairly simple computer
>prgram (compared to what we use on our PCs).

You are underestimating the build complexity of ECUs and their software.

An ECU has to take many input signals, deal with them in a predictable time (realtime) and then provide the necessary output signals. The programmer can't throw up an hourglass and "Please Wait" message if a sensor does not respond within a certain time. The software is far from "simple".

The components used in an ECU are not your average PC stuff either. They have to work reliably under much, much harsher environmental conditions so they are usually MiL spec. which cost several times their domestic equivalents.

>So how can they charge £1k for an ECU?..

Take a look at the prices for ruggedised laptops.

Kevin...
Cost of spare parts - how long will the scam last? - yorkiebar
"do have to laugh at these comments sometimes......

lets try and clarify a few points about car parts....

1/ profit on parts (at dealer lever from manufacturer)
major units.. engines gearboxes etc... no more than 7%
run of the mill parts.... 20%
service parts ...40%"



Nice try Swiss Tony but way out on the mark ups!

I dont deny the expense of running a main dealers, but I assure you, the Sales depts normally runat a loss (often because the way the books show the costs). The Service department generally breaks even or there abouts.

The only profitable department is the Parts, and they dont runat the margins you quote.

Engines , gearboxes, major parts are around 15 - 25% (Gross)Profit.
Run of the mill parts around 60 -70 % (GP)
Service Parts around 40 - 50 % (GP).

Not at all makes I agree, but certainly the majority of poular ones.

Just bear in mind what discounts are given to the trade versus retail and you will believe some of the prices.

Lets take an exact example? a wheel bearing (onlya bearing, no nut etc) costs around £ 65 retail, £ 45 trade. The exact same part no and make from a factor in a kit (with nut costs trade £ 32. The part is from the same manufacturer with the same part number on it.

Seriously trying to tell me that the part cost the Dealer Network more than it costs a factor to buy? In the words of the trade, "you are having a laugh!"

I spent some of my time in the parts supply business ( and help out at a local factor run by a friend, that supplies local main dealers) so I am not talking out of my hat. The price the dealer wants to pay for parts is way below what the factor can supply the trade at. Consequently the dealers only buy from the factors when stuck for time/supply.

Another fact, most factors run at healthy margins (seen many go bust?) because of the healthy mark up that their competition (dealers) make.

If their parts departments cant keep the business afloat then maybe the glass palaces are too expensive generally?

Edited by yorkiebar on 19/12/2008 at 21:09

Cost of spare parts - how long will the scam last? - the swiss tony
Nice try Swiss Tony but way out on the mark ups!
I dont deny the expense of running a main dealers but I assure you the
Sales depts normally runat a loss (often because the way the books show the costs).
The Service department generally breaks even or there abouts.
The only profitable department is the Parts and they dont runat the margins you quote.
Engines gearboxes major parts are around 15 - 25% (Gross)Profit.
Run of the mill parts around 60 -70 % (GP)
Service Parts around 40 - 50 % (GP).


LOL what dealers are you talking about there????
Ive been in the motor trade 30years, and I have NEVER seen parts @ those margins!
service parts always have the highest margins, by the mere fact thay are the fastest moving, so you are way off the mark there!

In my experience its the service Depts that make the profit, with labour rates @ say £120 PH do you think its costs £80 PH to run one?

I have in my time worked for factors, and their margins ARE higher than dealers, those ' The exact same part no and make from a factor in a kit' are often parts that have failed the manufactures quality control - im not saying they are unsafe, just not up to the higher standards - and in such cases often have the OE trademarks ground off... or take a short cut through the supply chain, thus less people making profit, cheaper price.

Ill agree that the sales depts struggle to break even on new cars, used ones (before the CC) however were a different kettle of fish...
Cost of spare parts - how long will the scam last? - yorkiebar
Going to have to disagree ST.

My info is based on fact, not prepared to name Dealers or Factors.

Info regarding OE trade marks ground off is poor. The same bearing fits more than 1 Make of car, very difficult to grind off the 5 or 6 makes? Maybe it isnt on there in the 1st place?

Tell the suppliers of the bearings and other parts that they are supplying lesser quality parts? Dont think they wouldbe too keen on that comment? They openly advertise they are OE suppliers, and that the same parts are available to selected outlets in the aftermarket.

Another example for you if you wish. There are 2 French manufacturers (I prefer to call them assemblers) that often have interchangeable parts. Indeed the part (same part number and label etc) is available in the same packaging at both dealers, at vastly different retail prices, let alone trade prices.

There is a huge mark up on most dealer only parts. Service items are generally lesser marked up because of the competition from other sources and the need for the Assemblers to "appear cheap on service parts" !

I have only been around a long time too. I dont have any issue with high mark ups on generally available parts; but I hate excessive mark ups on dealer only parts . Another example, a door cable. I was given 55% off retail. Retail was offered to my customer when he rang to confirm the price. If I get 55% off then they must be making more ? Or are they selling at a loss to me to help me stay in business?

Naive I may be, Stupid I am not.

Edited by rtj70 on 19/12/2008 at 22:10

Cost of spare parts - how long will the scam last? - the swiss tony
My info is based on fact not prepared to name Dealers or Factors.

So is my info - based on 30years in the trade. would you be prepared to name franchises?
Info regarding OE trade marks ground off is poor. The same bearing fits more than
1 Make of car very difficult to grind off the 5 or 6 makes? Maybe
it isnt on there in the 1st place?

I was speaking generally not on just one type of part i.e bearings..
Tell the suppliers of the bearings and other parts that they are supplying lesser quality
parts? Dont think they wouldbe too keen on that comment?

Well it the truth whether they own up or not!

There is a huge mark up on most dealer only parts.

NEVER have I seen that, and I have worked for many franchises! including one of the 2 you mentioned... I will however agree about the differing prices between the 2.

Another example a door cable. I was given 55% off retail. Retail
was offered to my customer when he rang to confirm the price.

Id check other dealers to make sure they havent added to the retail price. 55% to trade? I wish my department could offer close to that on a captive part - normally 10-15% tops!
Naive I may be Stupid I am not !

Havent said you are, just wondering which franchises can offer deals like those you have stated.
Cost of spare parts - how long will the scam last? - 1400ted
I agree entirely with Rattle, I had a small gearbox malfunction on Erin Doors's C3 Sensodrive. Had to take it to Citroen in Sale where they charged 2 hours labour @ £75ph to plug it in somewhere and download the upgraded software. Couldn't do that myself ! Rattle, if you want mechanical stuf, try Autocom on Darnley Street, just behind Tesco on Upper Chorlton Road. The two brothers have been in the game a long time and you'll get a good cabaret as they argue all the time.
Ted
Cost of spare parts - how long will the scam last? - freddy1
have you seen the mark up on bearings from a bearing factor ! makes your eyes water , if you have to pay retail
Cost of spare parts - how long will the scam last? - Garethj
The components used in an ECU are not your average PC stuff either. They have to work reliably under much much harsher environmental conditions so they are usually MiL spec. which cost several times their domestic equivalents.

Take a look at the prices for ruggedised laptops.


Agree with Kevin. I've been a design engineer for the automotive industry and for domestic products and the difference in testing is like night and day. Automotive parts are tested at higher temperatures, usually with dust, water and vibration thrown in too.

The testing takes longer, is more expensive, puts more constraints on the design and limits the components you can use.

I have little experience of dealer mark-up, except to say since car prices fell 15ish years ago, they now make their money on parts and servicing.
Cost of spare parts - how long will the scam last? - Carrow
A motor factor over the year will average between 32-36% profit margin. Maybe a bit more if in a prominent retail area like a high street, but most are on industrial estates so majority of business is delivering to garages. We have to stock a wider variety of products these days, more vehicles on road=more parts, so more cost to us. Garages won't wait so we have to have the availabilty and then we have to deliver it quickly, so that intial margin starts to erode as quickly (Driver wages,insurance,fuel,running costs).

We are not paid well, yet are expected to know every nut & bolt of your car and be a font of technical knowledge about every vehicle on the road. Most of our knowledge is gained through years of experience and reading trade magazines and technical bulletins from manafacturers, most of which we read in our own time because we are too damn busy during the day. BTW, a 60 hour week is not uncommon in this job & some of us even get out of hours calls from mates or garages who are desperate for a fanbelt, alternator etc.

Apologies for the rant, but we who serve your needs are not involved in a 'scam' of any kind.

Snipquote for the person who didn't read the pop up message asking NOT to quote the whole post they're replying to!

Edited by Dynamic Dave on 20/12/2008 at 12:05

Cost of spare parts - how long will the scam last? - TheOilBurner
I also wrote a centralised parts management system for a major manufacturer (one of the biggest) and so I was privileged to see the mark up on both the dealers side and the manufacturer (remember they buy in most of their parts before selling on to the dealers).

The figures that Swiss Tony talks about are a little on the low side, but not massively so. However, the manufacturer also makes a similar profit on those parts. So the total mark up from OEM supplier to parts desk can be quite large. If you can buy direct from OEM than you will save quite a bit of money, for sure.

I'm not allowed to give specific examples, but on the whole I do actually agree with ST and Carrow.

It's not a scam, yes the margins can be high but not as extreme as other sectors such as clothing. I've been lucky enough to write software for a major chain of high street outdoor clothing, some of their mark-ups were enough to make eyes water! And it's not like it takes much skill to sell someone a pair of thermal gloves!
Cost of spare parts - how long will the scam last? - L'escargot
........ I do know about electronics ..........


.......... but apparently not about the economics of producing, packaging, stocking, and selling relatively small quantities of thousands of different spare parts, some going back umpteen years.

You'd be one of the first people to complain if you couldn't get parts for a certain umpteen years-old Fiesta!

Edited by L'escargot on 20/12/2008 at 10:30

Cost of spare parts - how long will the scam last? - rtj70
That was my point too L'escargot. You cannot compare PC parts with car parts - my home PC is now 3 years old. I cannot upgrade the CPU to a faster one because it's a Pentium 4 660. I cannot drop a core2 duo or quad in because that will need a new motherboard - and also new memory. At that point I'd might as well buy/build a new PC.
Cost of spare parts - how long will the scam last? - Rattle
I am still not entirely convinced. I am sure the manufacturers and can do more to standardise components, I know this has happened more in the past ten years e.g VAG.

What ever the logistics the bottom line is the consumer is being robbed with a £200 TPS.

As for ECUs there really dosn't seem to be much to them, yes I know the casing is very strong and solid, and they use higher grade capacitors but there are very few components inm the ECU itself.

I think the manufacturers need to work on making the ownership of cars lower like Kia has attempted to with their 7 year warranty. At times like this if somebody still owes £3000 on say a Vauxhall Corsa which is 3.5 years old and has a snapped camshaft it reallty could be the end of the world for them, and since VX may not being that helpful with over inflated retail prices I am sure their next car will be something else.

I know a few people who will not buy another Renault purely because they were charged over £80 just for a new head lamp, ok it may not be the dealers fault but the design was stupid.

I just think people need to think long and hard about it, if we made cars more standard it would make cars cheaper to fix and would partly solvwe the logistics problems on parts.
Cost of spare parts - how long will the scam last? - yorkiebar
"A motor factor over the year will average between 32-36% profit margin"

Quite a good average figure for most factors from my knowledge. A large national chain often mentioned in here actually achieved nearly 40% last year!

Main dealers operate at a much higher margin than factors, so make your own opinions.

35% Gross Profit (or therabouts) on the turnover most decent factors will achieve is pretty good imo. Judge it by the amount of factors going bust in this credit crunch? especially since the motor trade is collapsing! I dont know of any in this area that are going under! Bear in mind the low margin stuff they have to sell too.

My friend is quite happy with his standard of living from his factor business, as I am with my repairs and sales. But the dealers are the ones who are struggling? Maybe its a business problem, not a pricing problem?

Main dealers, who are the ones with the much dearer prices are the ones who are guilty of the overpricing. They carry less than a factor, for less vehicles, with a much higher stock turn and have a quicker availability backup system too, and then at a higher margin!

Dealers carry very little slow or dead stock, they just buy it in from suppliers (not necessarily the vehicle assembler either) and sell at handsome margins. Even older vehicle parts are not necessarily stored even in the vehicle assembler system; but made available from their suppliers.

I dont shed many tears for the main dealer and vehicle assembler network. To afford their glass palaces they must have been making some money somewhere; and if its not from selling cars..........

Cost of spare parts - how long will the scam last? - astrabob
My wife had a Citroen ZX car for over three years.

We bought it very cheaply, she did a high mileage in it, so it did need a lot of repairs.

In that time, we spent £30 on spare parts from Citroen. We spent £1200 mainly at the two well known national motor factor chains, but also at local motor factors and scrap yards.
Cost of spare parts - how long will the scam last? - the swiss tony
Main dealers operate at a much higher margin than factors so make your own opinions.


Im sorry.....you MUST live in a dream world! I have worked on both sides, and the factors DO have a higher margin than dealers.
Main dealers who are the ones with the much dearer prices are the ones who
are guilty of the overpricing.

Prices are set by the manufacturer NOT the dealers.....

They carry less than a factor for less vehicles with
a much higher stock turn and have a quicker availability backup system too and then
at a higher margin!

WRONG again.....factors on the whole only keep fast moving stuff, probably with a stock turn of over 10 a year... as i said dealers look at a stock turn of 4 or above...
Dealers carry very little slow or dead stock they just buy it in from suppliers
(not necessarily the vehicle assembler either) and sell at handsome margins.

TOTAL carp...... if a dealer gets caught selling non-genuine parts they are at risk of loosing the franchise!
I dont shed many tears for the main dealer and vehicle assembler network. To afford
their glass palaces they must have been making some money somewhere; and if its not
from selling cars..........

Really??? as I said before, the money 'was' made in the workshop, and the used car sales...Now, sales are down, and people are holding back on repairs, and dealers are closing everywhere... now IF we were making these huge margins you think we are, why is that so many are going down the pan?
Cost of spare parts - how long will the scam last? - yorkiebar
Ive been both sides of the counter at dealers, and at factors. Got friends at both places too. Got my eyes open.

Your info is wrong on so many counts. Factors carry stock for the whole vehicle parc from A to Z from 1970's thru to 2000's. Dealers carry the 1 (or 2) makes from around 2004 onwards, other parts generally to order. Not quite sure how you think a factor will have a better stock turn? Most will be happy for a stockturn of 4. Dealers in my area wont keep a part in stock unless it moves once a month ! Work that 1 out?

Prices are set by the vehicle assembler I agree, but they also set them high !

And dealers dont sell non genuine parts? Dont make me laugh ! On the invoice, the part is highlighted with * and a covering statement along the lines of "Part sourced from alternative supply". If the network cant supply an OE part in time then of course the dealers source parts as required. As you know its dearer to keep a car in a workshop taking up space rather than source a dearer part and move it on.

And in all my years I have never know any main dealer to have a decently profitable service department yet. Too much equipment, training, tooling, consumables, H&S requirements, mechanic down time etc etc etc. The aim is generally to break even, achieve small profit if possible. Its the parts departments that carry the profit for the glass palaces!

But when a dealer supplies an IDENTICAL part, from the same manufacturer, at vastly different prices than other suppliers of that part, then people will obviously accept that there is a bigger margin !

But we going to have to agree to disagree I suspect.
Cost of spare parts - how long will the scam last? - Bill Payer
And in all my years I have never know any main dealer to have a
decently profitable service department yet.


A neigbour of mine works in accounts at a Peugeot dealer and told me that the service department is the only part of the dealership that makes significant money.
Cost of spare parts - how long will the scam last? - the swiss tony
>
A neigbour of mine works in accounts at a Peugeot dealer and told me that
the service department is the only part of the dealership that makes significant money.

Thank you Bill Payer....and of course people are holding back on servicing / repairs, so in most dealers the workshops are not busy..... hence so many dealers going to the wall right now.

I really would like to know which dealers make massive parts profits, so I can get a job there and be able to pay my bills.......
Cost of spare parts - how long will the scam last? - rjr
>> And in all my years I have never know any main dealer to have a
>> decently profitable service department yet.
A neigbour of mine works in accounts at a Peugeot dealer and told me that
the service department is the only part of the dealership that makes significant money.


I used to work as an Analyst for one of the biggest dealership groups in the country. Part of my role was to benchmark and compare profitability by department across all the dealers.

Typical departmental profit margin (sales less cost of sales less cost of parts staff) for a parts department was 25%.

Typical department profit for a service department would be higher at around 33%.

These would usually be the only parts of the dealership that made any money to pay for the dealership overheads (rent, rates, admin staff, interest on loans etc).

Average dealership profitability would be in the region of 0-1.0% and I left the motor trade before the economic downturn. I expect that almost all dealerships will be making losses at the moment.

My experience of the motor trade makes me think that TheOilBurner, the swiss tony and carrow are closer to reality than yorkiebar.
Cost of spare parts - how long will the scam last? - Andrew-T
>Part of my role was to benchmark and compare profitability by department across all the dealers.

I don't suppose those analyses were easy to tie down. I changed cars last week at a long-established Peugeot dealer; the screen price on the 8-month-old 207 was competitive (about a grand below WhatCar's valuation) and the offer for my 306 was par (not much flexibility around the 1K mark). But the sell and buy prices entered on the bill of sale were adjusted by several hundred so that less went down the VAT plughole, the difference being called a 'Used Car Discount'. I was not surprised by that - I have seen it before - but it may make 'profitability' harder to measure and compare.
Cost of spare parts - how long will the scam last? - yorkiebar
"My experience of the motor trade makes me think that TheOilBurner, the swiss tony and carrow are closer to reality than yorkiebar."



It doesnt matter to me who is right and who is wrong, and where profits are made or not.

But I am no novice to the motor trade.

Just look at parts prices and discounts available and given though? Way different to what you are led to believe on here by some. Disounts of 25% are regularly given, but we are told there is only a mark up of around 15 - 20%. Compare Peugeot and Citroen identical parts but priced differently by huge amounts etc. Vauxhall trade club prices too?

Believe who and what you want.

Cost of spare parts - how long will the scam last? - L'escargot
I am sure the manufacturers and can do more
to standardise components ..........


If and when I buy my next new car I will want it to have the very latest technology. With all due respects, I will not want it to contain anything that was used in a 1996 Fiesta!
Cost of spare parts - how long will the scam last? - Rattle
Buty how much technology moves on? Surely preasure caps, brake fluid caps, hoses, radiators, water pumps, alternators, starter motors etc could be standard on all cars? Eidt I realise different cars need different fittings due to reasons of space, but I am sure more cars could use more standard parts./

Edited by Rattle on 20/12/2008 at 14:18

Cost of spare parts - how long will the scam last? - the swiss tony
Parts ARE getting more standardised BUT there are parts that have to be different
think about it, if all parts were the same throughout the industry, we would all be driving around in identical cars.... truth is the customer DEMANDS a choice

why are there so many different choices of motherboards, video, sound cards, hard drives... PC cases... etc..... surely it would be better if all PC parts were identical.... that would make rattles job a lot easier??
Cost of spare parts - how long will the scam last? - stunorthants26
I recently got quoted £32 for a genuine air filter for my Charade - needless to say I left it on the shelf.
I did have to purchase a new sun visor though at £39 which seems alot for what it is.
Still, its the sam evisor as in the Sirion, so parts are subtley used across ranges.
Cost of spare parts - how long will the scam last? - L'escargot
Buty how much technology moves on? Surely ......... hoses radiators water
pumps alternators starter motors etc could be standard on all cars?


The particular design restraints and performance, quality and durability requirements of different manufacturers and different models make it impossible for there to be much in the way of standardisation.
Cost of spare parts - how long will the scam last? - mfarrow
With all due respects I will not want it to contain
anything that was used in a 1996 Fiesta!


If you said the 1976 Ford Fiesta you still wouldn't get your wish L'escargot.
Cost of spare parts - how long will the scam last? - Andrew-T
>If we made cars more standard it would make cars cheaper to fix ..

Having now moved from eighties and nineties cars (205 & 306) to a noughties one (207) it is clear how design has changed, from owners being able to do many maintenance tasks to doing almost none - a way to protect vehicles from bunglers, but more essentially to protect garages' servicing income. Handbooks now reveal how to change bulbs, wheels and not much else. And to help in all this, many jobs are best done on a hoist, which few owners have.
Cost of spare parts - how long will the scam last? - Rattle
I am doing going to be deafeted, I am sick of taking my car into a garage when things I can do myself need doing. After christmas I am going to buy a good trolleyjackl and some axle stands.

I am not going to start messing with brakes or suspension but I can at least do things like that reverse switch, oil changes etc myself.
Buying a trolley jack - buzbee
[Buying a trolley jack]

Keep an eye open on LIDL. Once a year they stock ones, as sold elsewhere for more money. I went back and bought a second one. One each side under the front jacking points, for instance, will quickly lift the front.

As you know, by your intended use of axle-stands, those getting under cars should use back-up support, just in case the support collapses. I am always wary that the patch of concrete I am using may not be as good as it looks.




Edited by buzbee on 20/12/2008 at 20:46

Cost of spare parts - how long will the scam last? - Old Navy
[Buying a trolley jack]

Why buy two? You can only reach one at a time, so lift one side, axle stand under and repeat on other side. Machine Mart do some good quality jacks and stands at good prices.

Edited by Old Navy on 20/12/2008 at 20:49

Cost of spare parts - how long will the scam last? - L'escargot
........ I am sick of taking my car into
a garage when things I can do myself need doing.


If you got rid of your ill-fated Fiesta and bought something more reliable you wouldn't need to visit a garage so often!

;-)
Cost of spare parts - how long will the scam last? - Kevin
>but there are very few components inm the ECU itself.

You're complaining that they have reduced the component count?

You really don't understand electronic design or manufacture do you?

It is intentional and good design. Fewer components - less to go wrong, better reliability and lower manufacturing cost.

Kevin...
Cost of spare parts - how long will the scam last? - RichieW
I had to replace a lambda sensor in May this year for a Zetec engined Ford. The local Ford dealership quoted me £122!!

The local factor had one in stock for £35. I've now made it a matter of principle never to go back to the dealer again unless there are no alternatives. Frankly it's more than scam, it's insulting.
Cost of spare parts - how long will the scam last? - Rattle
£122 is not actually that bad I have read of a lot of worse quotes. Was your £35 designed to fit a Focus or did it require soldering? Some of the cheap lambdas are generic and not always ideal.

Kevin I am not complaining about less parts, I am just compaining about people being charged £1000 for port that consists of a few capacitors and a processor which is about as powerful as a 386 DX. The research and development of the ECU should be covered in the price of the car, not some poor sod who owns the car 4 years later.
Cost of spare parts - how long will the scam last? - the swiss tony
Kevin I am not complaining about less parts I am just compaining about people being
charged £1000 for port that consists of a few capacitors and a processor which is
about as powerful as a 386 DX. The research and development of the ECU should
be covered in the price of the car not some poor sod who owns the
car 4 years later.

Rattle... how about looking at your own industry before saying such things?
There are many parallels in both industries!
IF R&D was paid for in the machine price you would never be able to buy a computer for £300, same applies with cars.
think about it, a production run for a car is about 5 - 7 years now, with facelifts in that time.. where the car will last upwards of 10 years, and require parts replacing (but not as many as yesteryear....)
The ECU you mention will have software in it, which like Windows is regularly updated (people who never go to a dealer can miss out on updates!) to help the vehicle preform better...
Remind me Rattle, How much is a copy of windows now?
I have built my own computers, so I have an idea of the prices, and I believe that the difference in regards a built up car/computer and the same thing in 'spares' plus software, isnt as large as you seem to think....
Cost of spare parts - how long will the scam last? - RichieW
Rattle. Re the lamda sensor. It was an identical part to the one it replaced. No soldering required as it had the correct electrical connectors for the wiring. It may or may not have been made by the OEM supplier, who knows these days?
Cost of spare parts - how long will the scam last? - welshlad
just been watching an old 'on the buses episode on t.v (and the 2008 award for most dubious motoring link goes too.......)and and one of them has just complained about a big plate of food costing him 12 of the new p (this was filmed in 1971) and you think we have it bad :-)
Cost of spare parts - how long will the scam last? - yorkiebar
Bear in mind Richie W, that the dealer, via the assembler, will have a much better purchase price than the factor; regardless of how they will tell you they work on no margin!

Glass palaces require more than turnover, they need margin too.

Find me the workshop that makes more than a parts department and I will find a hat to eat! MOT's are hated at delear level generally because they operate below cost price; subsised by the workshop generally. And they bring in around £ 50 anhour. So at £ 80 hour, and a full and busy workshop (thats not often in the normal times let alone now) they are making loads of money there and not the parts counter?

I really must believe more of what I am told rather than what I know though ! :)
Cost of spare parts - how long will the scam last? - rjr
Find me the workshop that makes more than a parts department and I will find
a hat to eat!


I spent 4 years benchmarking and analysing dealership profitability. I don't think I ever saw a parts department make more money than a service department.
Cost of spare parts - how long will the scam last? - yorkiebar
We are going to contiinue going round in circles then.

My contacts and info all tell me opposite and I have no reason to disagree.

Quite simply I know how much a workshop costs to run on a small basis. magnify it! I also know how much discounts are given on parts (none to retail usually). magnify that? Add in the cost of staff in Parts (laughng now) and work that out too.

Now, it may be the way it is shown in accounting, but it doesnt take a rocket scientist to work out where profits are made !
Cost of spare parts - how long will the scam last? - the swiss tony
Yorkie, I wish I had your contacts, coz I AM speaking as I have found, and I have been in the trade many years, and worked at different franchises from the bottom to the top end of the markets, and honestly I have NEVER seen the margins you claim...
tinyurl.com/e90p

with regards MOT's, yes.. they is no money in doing them, but if you get a car which fails, then hopefully you make some on the repairs, and most places will not fail just to get work.

discounts on parts? getting common now just to get the work in the workshop... often at 10-15% off retail.

Cost of spare parts - how long will the scam last? - Kevin
>Kevin I am not complaining about less parts, I am just compaining about people being
>charged £1000 for port that consists of a few capacitors and a processor which is about
>as powerful as a 386 DX.

But it is not a 386!

As I've tried to explain, it is a collection of custom built ASICs that have been designed to withstand temperatures between -50C and +50C while being shaken about under the hood of a car. You are paying for the component quality not the "power". You could stick the fanciest quad-core super dooper 5GHz processor in there and it wouldn't last ten minutes never mind ten years.

>The research and development of the ECU should be covered in the price of the car, not some
>poor sod who owns the car 4 years later.

What do you tell a customer who's 4 year old PC has just cooked it's CPU?

"Don't worry, the cost of a new CPU and motherboard is covered by R&D costs. I'll only charge for labour."

Kevin...
Cost of spare parts - how long will the scam last? - Rattle
On a four year old computer I would sadly say its time to through it in the bed, and yes it is due to labour costs rather than parts. I used to replace motherboards, but I would find I would only make £50 on each job, and would have to back the entire system up, format it, install the new drivers, obvoisly have the hassle of removing the old board, then putting a new board in, then the RAM won't fit so you need new RAM etc etc. So it is better value for my customer just to buy a new computer which I usually supply at cost but then make money on the labour.

This is my gripe with dealers, they charge £80 an hour (not arguing about that, that is another debate) but say the part has a 50% mark up and costs £500 they are already going to make a huge amount of profit just on the labour. Yes I know garages have high running costs, but so does a certain large computer chain yet if they sold a laptop at £500 they would be extremely lucky to make £15-£20 on it.

Now the dealers are going bust as people are keeping their working cars, but also going to cheaper local garages. I think many of us with more than 3 year old cars have tried the dealers once or twice and been insulated by the prices.

I do take your point that an ECU does have to work under a lot of stress, I was really only thinking about it from a simplistic software and procesing point of view, neglecting the fact it has to work under a lot of stress. PS 386 CPUs have been used for autopilots until very recently because a 20Mhz processor is all the system needs, and they were very reliable as they produced so little heat.

Kevin I am not trying to disagree with you, I am just telling you how I see it from a consumers point of view. e.g somebody not connected with the car industry.
Cost of spare parts - how long will the scam last? - LondonBus
Dealers are getting more real.

Our local Nissan franchise offers a very good price (compared with independents) for a service on vehicles which are out of Warranty.

(There's also the peace of mind of ECU being updated etc.)
Cost of spare parts - how long will the scam last? - yorkiebar
"Yorkie, I wish I had your contacts, coz I AM speaking as I have found, and I have been in the trade many years, and worked at different franchises from the bottom to the top end of the markets, and honestly I have NEVER seen the margins you claim..."

Erm, my contacts and info come from working in a few dealers, having a good relationship with a few dealer principals, a very good drinking/working arrangement with service managers and parts managers (manager of how many staff ?) and owner of a factors, and by running my own business.

I may not be very eloquent, but I know what goes on. Tell me you cant get 45% off oil from some dealers? 25% off service parts? Same (identical) parts even cheaper elsewhere!

A lot of the cloud is probably how the accountants show it, but my opinion is based on facts, not impressions and hearsay.

In fact, having shown this thread to a parts manager, he comments. Maybe because the parts are transferred to the service department at nett price so they can show the profit in the workshop! Says a lot for the accounting, but the profit is in the parts which ever way you want to look at it.

Not bothered what people believe; but the hypocrisy of the dealers teling you that there is no money made (to run the glass palces) but then giving big discounts at the same time.

I make profits too; I have to to survive. But I dont deny the profits.

And as for the comments about the dealers making 1% profit. What a laugh; the moneyinvested would make more in a bank even at current interest rates. Dont believe that anybody operates at those margins and survives for any longer than weeks !

Convince the ordinary motorist on here that the parts arent over priced (often, not always) by all means. But dont try and convince those in the know!
Cost of spare parts - how long will the scam last? - RichieW
I'm with Yorkie on this one. It's just a case of accounting for different areas of the dealership. The silly profiting is still from the parts. If I'd taken my car to be fixed at the dealership then the service people would have realised the profit on the sensor to be fitted rather than the parts people.

Even if the invoice showed a reduction of ten or fifteen percent for the part they would still be laughing especially with the 15 mins labour or whatever minimum they charge these days at £80 an hour.The majority of the profit would have been on the parts fitted rather than the work undertaken.

I suppose the balance changes if you are doing a Mondeo clutch change and the parts profit component goes down as a percentage compared to the labour component which goes up.

Dealers just replace parts these days, there are few old fashioned repairs or fixes. The profit in my opinion comes from parts whether accounted for at the service bay or parts counter makes no difference. The customer is handing over his hard earned for the parts.
Cost of spare parts - how long will the scam last? - captain chaos
I wonder how much it would cost to build a car entirely from parts from the parts department and assembled by the dealer at their usual hourly rates? One million? Two million? How long would it take? "Sorry sir, that part is on back order from Germany and they don't know when they'll be getting them in"
I really must get out more..... ;-)
Cost of spare parts - how long will the scam last? - the swiss tony
In fact having shown this thread to a parts manager he comments. Maybe because the
parts are transferred to the service department at nett price so they can show the
profit in the workshop! Says a lot for the accounting but the profit is in
the parts which ever way you want to look at it.


transferring at nett to the workshop, is very rarely done in my experience, I have never in fact worked anywhere that has done that, with the exception of oils, and yes there can be a big markup on that.
Most dealers, (and every one Ive ever worked for) keep the accounting of parts, labour, and cars sales separate, that includes expenditure as well as profit.
Not bothered what people believe; but the hypocrisy of the dealers teling you that there
is no money made (to run the glass palces) but then giving big discounts at
the same time.
I make profits too; I have to to survive. But I dont deny the profits.

There IS very little profit at dealers right now, in fact the one I work at IS making a loss this year, and a very large one at that, yes they have made profit in years gone by, but today is a very different, and difficult time.... just open your eyes and see how many dealers, and groups are going down the pan right now... big profit today? BULL POOH!
And as for the comments about the dealers making 1% profit. What a laugh; the
moneyinvested would make more in a bank even at current interest rates. Dont believe that
anybody operates at those margins and survives for any longer than weeks !

your right... and as I just stated MANY ARENT!
Convince the ordinary motorist on here that the parts arent over priced (often not always)
by all means. But dont try and convince those in the know!


I have already stated dealers dont make the prices, and the margins Ive worked with, are nowhere near where you claim, Id stake my kids lives on what Ive said -I really dont know where you have got your info from -but as I have said, just look how many dealers are going under, that DOES NOT happen with high profit businesses
Cost of spare parts - how long will the scam last? - yorkiebar
But the poor old parts depts cant make the money to cover all the excess costs of the other depts! If servicing breaks even it takes the load off the parts. Servicing down = more costs to cover!

Simple accounting really. Its lack of turnover, combined with too much expense!

And yes there are some profitable dealers about still, less than there were I agree.

Lots are cutting back on mechanics and salesmen too. Any decreasing their parts sections? Absoloutely none that I know of ! Do you? I seriously doubt it! What does that tell you and other people?

Regardless of what you say. An item that sells retail £65, trade £45 and Im told they still make about 25% Gross, so costs about £33, isnt decent profit? Tell that to a factor ! And a part at 55% off? Selling at a loss are they? For a captive part?

Too much of your "info" is not right, eg dealers not allowed to buy and supply non genuine parts, for me to believe that you are in a position of sufficient knowledge to tell me how wrong I am (not) ! Likewise those telling me that they operate on a 1% profit margin.

Get real !

Fed up with this 1 now !
Cost of spare parts - how long will the scam last? - rtj70
Are people mixing up income vs profit. I can imagine the parts department does not bring in so much income but good profit. And we all know dealers get a good part of their income from sales bonuses and not selling the actual cars.
Cost of spare parts - how long will the scam last? - yorkiebar
And as for the comments about the dealers making 1% profit. What a laugh; the
moneyinvested would make more in a bank even at current interest rates. Dont believe that
anybody operates at those margins and survives for any longer than weeks !

your right... and as I just stated MANY ARENT!


I had to come back at this.

But the poster of the comment was stating how he had been analysing profitability for 4 years or so.

No way would any dealer have lasted 4 years at those margins, and Swiss tony comment agrees !

Way too much wrong info on here !

But thats the motor trade and cars in general for you. Everybody knows better about the car and the trade, than those working for a living in it!
Cost of spare parts - how long will the scam last? - rjr
But the poster of the comment was stating how he had been analysing profitability for
4 years or so.
No way would any dealer have lasted 4 years at those margins and Swiss tony
comment agrees !
Way too much wrong info on here !


I don't disagree with your comment about there being too much wrong information in thi sthread but we would probably disagree about who it was quoting incorrect information.

www.trevorjones.uk.com/publications/drivingforce18...f

The above link takes you to a motor trade journal. The interesting part is the statistical analysis across a large percentage of dealerships in the UK for the last few years.

National average net profit 2005 0.6%
National average net profit 2006 0.7%
National average net profit 2007 0.6%
National average net profit 2008 0.4%

The comparison on service and parts gross profit is self explanatory as well...
But thats the motor trade and cars in general for you. Everybody knows better about
the car and the trade than those working for a living in it!


Quite!

Edited by rjr on 22/12/2008 at 07:31

Cost of spare parts - how long will the scam last? - yorkiebar
If analysts and accountants and specialists are advising businesses how to continue to achieve those (less than 1%) profits (net, not gross as I was quoting btw) then they are very poor.

Best advice to anybody operating at those margins is to get out while they can. The money invested would have made more in a bank, and still would. Who would advise that those margins are worth pursuing? Nobody, full stop !

It seems to be prevalent since 2005 according to your sources!

How on earth have they survived until 2008 let alone through 2008.

Something doesnt add up does it?

Statistics, Lies and Damn lies springs to mind.

Cost of spare parts - how long will the scam last? - rjr
If analysts and accountants and specialists are advising businesses how to continue to achieve those
(less than 1%) profits (net not gross as I was quoting btw) then they are
very poor.
Best advice to anybody operating at those margins is to get out while they can.
The money invested would have made more in a bank and still would. Who would
advise that those margins are worth pursuing? Nobody full stop !

>>

Perhaps they understand the difference between profit (being return on sales) and return on investment (being equivalent to receiving interest on a bank balance).

Statistics Lies and Damn lies springs to mind.



I see, everything that is too complicated for you is a lie.
Cost of spare parts - how long will the scam last? - the swiss tony
Lots are cutting back on mechanics and salesmen too. Any decreasing their parts sections? Absoloutely
none that I know of ! Do you? I seriously doubt it! What does that
tell you and other people?

Yes I do know parts departments cutting down on staff.... 1st hand! the dealer I work for, for a start!
I dont know if Ill have a job next year, so dont keep telling me Im talking carp.. IM NOT!
Regardless of what you say. An item that sells retail £65 trade £45 and Im
told they still make about 25% Gross so costs about £33 isnt decent profit? Tell
that to a factor ! And a part at 55% off? Selling at a loss
are they? For a captive part?

As Ive said before, captive parts do not come into a dealer at that kind of percentage!
Normal trade, as I have said before is around 15% off retail, so your £65 part would be £55.25 trade, and probably £45 cost!
Too much of your "info" is not right eg dealers not allowed to buy and
supply non genuine parts for me to believe that you are in a position of
sufficient knowledge to tell me how wrong I am (not) !

You ARE wrong! it is in dealer agreements not to use non genuine parts, if you get caught you are at risk of loosing the franchise - not worth the risk!
Get real !

I am being real!
Fed up with this 1 now !

Not as much as I am!
Cost of spare parts - how long will the scam last? - yorkiebar
Despite disagreements, genuinely sorry to hear that your job is in jeopardy.

Absoloutley the 1st dealer parts dept cutback I have heard of (other than totally failing and closing down all together.)

We are not going to agree on other areas I know. I have my invoices, you see yours.

But good luck on the job front, and dont dismiss the factors if looking for work. Times are hard but not totally dismal.

Good luck, lets leave this 1 where it is. Other people can make their own minds up.
Cost of spare parts - how long will the scam last? - the swiss tony
Cheers for that Yorkie... I am looking as we speak for other positions, and yes... factors as well!

And yeah... lets agree to disagree.....

Edited by the swiss tony on 21/12/2008 at 23:23

Cost of spare parts - how long will the scam last? - oilrag
" it is in dealer agreements not to use non genuine parts, if you get caught you are at risk of loosing the franchise - not worth the risk!"

Not many people would expect an owner to to do interim oil and filter changes during warranty. Much less to carefully examine the oil filter (paper type) element and clean it up to see the brand.

Six months after the 1st year (main dealer) service I was startled to see an obscure name element - cheap seeming - straight pleat element fitted. Not a `concertina` more substantial, thicker pleated, Purflux type as was originally fitted.
(I`ve been buying filters from the same dealerships parts ever since and all have been the `concertina` pleated type the car had while new.)
Now you can make of that what you will - but when I called at the local factors hoping to source the concertina pleated type - I was presented with the less substantial - thinner and flimsy looking element type that seemingly had been fitted after the first service.

I never let anyone touch it after that - even during the warranty period.



Cost of spare parts - how long will the scam last? - jase1
I have to say that I find all this talk about overpriced ECUs amusing.

The more apt comparison is with something like a ruggedised network component, and you'll find that these also cost many hundreds, if not thousands of pounds and often have nothing more powerful than a 1.5GHz main processor and 256MB of main memory.

But that is missing the point. The custom ASICs on those things are staggeringly expensive to produce on a relatively short run, and the R&D that goes into the software needs to be clawed back.
Cost of spare parts - how long will the scam last? - Number_Cruncher
To add a little to jase1's post, when ESA are considering the costs of a satellite, each electronics box (typically containing 4 or 5 PCBs, and perhaps half a dozen ASICs or FPGAs), they budget on paying about 5 million Euros for it.

Car ECUs are seriously cheap, and remarkably reliable.

Cost of spare parts - how long will the scam last? - NowWheels
The more apt comparison is with something like a ruggedised network component and you'll find
that these also cost many hundreds if not thousands of pounds {{snip}} The custom ASICs on those things are staggeringly expensive
to produce on a relatively short run and the R&D that goes into the software
needs to be clawed back.


Jase1, consider an ECU fitted to a £10,000 supermini. The unit production cost of that car as it leaves the factory gates is probably only half that price, and I don't believe for a moment that manufacturers are going to allow a small box of chips to gobble up 10% or more the the total cost of producing the vehicle.

Sure, these are ruggedised units, but I'd be astonished if they are anything other than a standard box fitted to millions of cars, just with software settings customised for each application. I'd be very surprised if the unit cost was as much as £100, and the huge prices charged for replacement units have more to do with the captive markets involved than with cost-to-supply.

When a new ECU is needed, only the vehicle manufacturer can supply it, so they can charge what they like ... and it seems that is exactly what they do.
Cost of spare parts - how long will the scam last? - Kevin
>I don't believe for a moment that manufacturers are going to allow a small box of chips to
>gobble up 10% or more the the total cost of producing the vehicle.

A "small box of chips"? A new ASIC can cost millions to design and hundreds of dollars per unit to produce. Your "small box of chips" soon adds up when you consider the total amount of silicon in a modern vehicle.

Engine (and emmissions) management - silicon.
Transmission control - silicon.
ABS and traction control - silicon.
Airbags - silicon.
Security - silicon.

>but I'd be astonished if they are anything other than a standard box fitted to millions of
>cars, just with software settings customised for each application.

Then astonished you should be.

There is no such thing as a generic ECU that will fit millions of cars.

>I'd be very surprised if the unit cost was as much as £100,

Which simply indicates that you don't have a clue about engineering and manufacturing. The casing and connector probably costs £50 before you start filling it with "chips".

Kevin...
Cost of spare parts - how long will the scam last? - OldSock
To be fair, it's not just car spares, is it?

How much would you say it costs to manufacture a triple-blade razor cartridge - and how does that relate to their price in Sainsbury's?
Cost of spare parts - how long will the scam last? - Focus {P}
How much would you say it costs to manufacture a triple-blade razor cartridge - and
how does that relate to their price in Sainsbury's?


But if it was that easy, there would be lots of competitors undercutting them.

If a company is prepared to plough lots of money into developing something like that, then they should be entitled to make a bit of profit before the copycats come along and bring the price down. If the copycats stay away, perhaps it's an indication that the product isn't as overpriced as it appears to be.
Cost of spare parts - how long will the scam last? - OldSock
If a company is prepared to plough lots of money into developing something like that
then they should be entitled to make a bit of profit....


I'm sure car manufacturers would agree with that sentiment :-)

Still seriously considering growing a beard, mind!

Edited by OldSock on 22/12/2008 at 11:18

Cost of spare parts - how long will the scam last? - L'escargot
............ before the copycats come
along and bring the price down.


Buying unauthorised copies of anything is dodgy. The copier can measure a number of samples of the original and choose their dimensions based on that data, but they can never keep to the same upper and lower limits as the genuine articles because they won't know what they are.

Edited by L'escargot on 22/12/2008 at 12:18

Cost of spare parts - how long will the scam last? - Focus {P}
>> ............ before the copycats come
>> along and bring the price down.
Buying unauthorised copies of anything is dodgy.


Agreed - I was thinking of supermarket own-brand versions (razor blades rather than car parts).
 

Ask Honest John

Value my car