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Oil Change. You be the judge

Discussion in 'Gen 3 Prius Care, Maintenance & Troubleshooting' started by jnet, Aug 19, 2013.

  1. GrumpyCabbie

    GrumpyCabbie Senior Member

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    OK ask this question. How much mark up is there on a brand new car? Then ask how much is on 60,000 miles of service and maintenance.

    There's your answer.
     
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  2. kbeck

    kbeck Active Member

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    My understanding is that the heavier the iron that a dealer sells, the bigger the profit margin. (Not a joke, I've seen the analyses, it's one of the reasons Detroit nearly gave up on small cars.) Some years back I tried to test drive a Ford Focus and found the same stuff you did: A showroom full of SUVs and pick up trucks. They had some Ford Focuses across the street in the back of the lot and they wouldn't show me or my wife any of them until they had a sales critter free from hawking big iron.

    Not all dealerships are like that, but it's obvious when one finds one. The ones around here aren't shy about putting the Priuses out front where one can see them, looks like you've got a poor one out that way.

    KBeck
     
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  3. edthefox5

    edthefox5 Senior Member

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    Yeah all those rich guys got together and spent millions building beautiful buildings with huge storage lots in town and non stop expensive tv & radio ads and monster new car floor plans and huge sales staff and then rubbed there hands together and said boy oh boy were gonna make a fortune fixin' them cars.

    Where's my oil filter wrench at?
     
  4. jnet

    jnet Member

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    The dealers have to sell cars in order to support their service departments. Service is where the real money is. This is why they offered me free state inspections for all of my other cars even for the non-Toyota cars. They make it sound like a good deal until they charge you $90/hour labor rate.

    Likewise in the U.S., they sell printers in order to sell ink and toner. Ink and toner are the real money maker. Printer manufacturers either not make money or even lose money selling printers.
     
  5. jnet

    jnet Member

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    Well, they are poor in selling Prius but not as bad as your experience with Ford. When I asked to see the Prius, the sales man didn't try to talk me into buying something else. At first, I thought that he didn't have any in stock since I didn't see one on the lot. After he checked the computer, he took me to the back of the building where the Prii were hiding. That's when I knew that the dealer wasn't interested in selling Prii. But they will sell it if you ask for it.
     
  6. edthefox5

    edthefox5 Senior Member

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    Oh........your a troll. Now I get it. Bye Bye.
     
  7. jnet

    jnet Member

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    The following is a clip from forbes.com

    "The Service and Parts Department is the real workhorse of dealership profits, representing both revenues and gross profit. For the Penske Automotive Group, which has operations in the United States and in the United Kingdom, service and parts represented 13 percent of annual revenues, but 44 percent of the gross profits.

    The gross margin for service and parts was 57 percent for the Penske group, vs. just 8 percent for new-vehicle sales.


    To be sure, dealerships still need the top line revenues they get from selling new and used cars. Customers shouldn’t get lazy about negotiating the best possible price. But they should also be aware where the real money is being made"
     
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  8. GrumpyCabbie

    GrumpyCabbie Senior Member

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    That might explain why many Nissan dealers appear reluctant to sell the Leaf. How do you make money out of a car that doesn't need oil changes, filter changes, require new exhausts etc.
     
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  9. The Electric Me

    The Electric Me Go Speed Go!

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    Calm down Ed.

    I don't think the point is you must have the dealer change the oil. The point is you must have the oil changed on a schedule and be able to document it. Whether you do it...or the dealership.

    Nobody is saying the dealership MUST change the oil, the debate all along within this thread has been as to intervals between changes.

    And with a new car, if you don't follow the recommended intervals, it could "hypothetically" become an issue if you needed any warranty work. But I don't think anyone is saying you can't do it yourself.
     
  10. jnet

    jnet Member

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    By the way, the title said "you be the judge". I'm not here to tell anyone that they should do what I do with the oil change habit. I'm just trying to point out some facts that I saw from the past and present and you can decide. It's your car and it's your money. Spend it as you please. In fact, I don't want to see dealers losing revenues because I need to have them around. So if you're happy to support them, please do.
     
  11. jnet

    jnet Member

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    Exactly....if my dealer didn't want to sell the Prius, they certainly would hate selling pure EV's. This past weekend, I went to the dealer to get my free oil change. This is what I saw. 2 people behind the parts counter, 1 cashier, 3 advisers, and 2 guys that run between the shop and the drop off area. I wasn't allowed to go into the shop so I don't know how many people work back there. That's 8 people that I could see at the front. I walked over to the showroom, I saw 3 people there. Not sure if there were salesman or not but it was pretty quiet there.

    It's not hard to figure out where the real money is coming from for them
     
  12. kboofan

    kboofan New Member

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    I would love Grumpy Cabbie to give his opinion about removing the AC cabin air filter… stinks the damn car up. My last car was a 94 Honda, no cabin air filter, no moldy smell, still runs well. After one year my PRIUS stinks when turning on the fresh air fan -- what is that??? Many used priuses had this moldy stink from their AC/air circ system when I was shopping for this car...
     
  13. GrumpyCabbie

    GrumpyCabbie Senior Member

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    I don't remove my cabin filter but I do change it every 10,000 miles (not the 20k stipulated in the UK service schedule). Some people like to remove them completely but that just clogs them up with dust after a year or so.
     
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  14. chrisj428

    chrisj428 Active Member

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    Oh Emm Gee...so much misinformation I lost track of who I wanted to quote about what.

    First off, someone said that early-adopters of the Gen III still had to change their oil every 5k or the warranty was voided.
    --NOT TRUE Toyota sent out updated wording for the owners' and warranty manuals.

    Someone from the UK said we're being fleeced by dealers here in the US because of the shorter OCIs.
    --WITH RESERVATION The reason vehicles operated in the UK and Europe have the longer OCIs is due in part to the different formulations of oil and gas to which we are not privy here in the US. So, while a UK or European Prius may go longer between oil changes, it's not on a US oil formulation.

    Someone said there's much profit to be made in oil changes by dealerships.
    --WITH RESERVATION Oil changes are loss-leaders. Service departments lose money on every oil change that comes through the door. However, it gives them a chance to inspect the vehicle and make recommendations for other services and repairs. That's where the money is made; not with the oil change itself.

    Multiple people mentioned the longevity of the filter vs. the oil itself.
    --TRUE My concern lies not with the oil itself, but the tuna-can sized filter charged with holding 10k miles' worth of contaminants at bay while still providing effective flow rates.

    Someone mentioned changing the oil at 1k miles to remove all the "stuff" from the new engine.
    --NOT TRUE Engine blocks are cleaned after machining and before assembly. Just ask Chrysler what happens when the guy who's supposed to be doing the cleaning calls in sick at their 3.6 liter plant and nobody notices (true story).

    My '86 Mazda or '90 Fiasco 400 would go 40k between oil changes. I got 500,000 miles on the motor and it was still running strong when I sold it.
    --TRUE I'm sure they did. They also didn't have the tighter tolerances that today's engines do. They also typically ran cooler than today's engines do. They also didn't have to operate within the tighter parameters that today's engines do. That's like saying I'm not going to buy a house because it's $150k and my dad got one for $3600 back in the '60s. Who cares. They're both houses, but the circumstances are vastly different.

    A car is typically the second-biggest financial transaction the average person makes.
    --TRUE So, why cheap out on maintaining it? (note: I didn't say "take it to the dealer")

    [\endthread]
     
  15. Mike500

    Mike500 Senior Member

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    Yeah, RIGHT!

    I believe everything! NOT!

    For years I worked in the aircraft industry and did FORENSIC test of parts and wear.
    They can really clean and match the parts perfectly. Impossible, even in the best clean rooms available.
     
  16. Okinawa

    Okinawa Senior Member

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    It is not a warning to change your oil every 5,000 miles. Tire rotation at 5,000 miles and oil change at 10,000 miles.
     
  17. SageBrush

    SageBrush Senior Member

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    I agree with the conclusion that service is a lucrative business for dealerships, but GC's argument is weak:
    The car costs say $25,000, while the service is say $250
    So the mark-up on the service would have to be 100x that of the car for equivalent gross profit.

    A dealership has to keep a staffed and operational garage. That is a huge fixed cost. Service helps the dealership put that garage to use.
     
  18. edthefox5

    edthefox5 Senior Member

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    New car sales is the lifeblood of the American economy. Not servicing your vehicle. TV stations survive on new car commercials and not one mentions the service center.

    There is a very big mark up on a new Prius like any other new car. Enough to pay the salesman $300+ a pop and still make a killing.
    Why do you think there's so many salesman at a new car dealer. What do you think is paying for all the car commercials?

    The best $$$ part of a dealer maintenance plan is to get you in the building and walking around the show room looking at all the new shiny cars and smelling the new interiors while some guy who cant speak English wails on your car. Meanwhile your in the lobby measuring the quality of the service on your car by how tasty the donuts and popcorn is.
     
  19. GrumpyCabbie

    GrumpyCabbie Senior Member

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    I'm not saying they make NO money on a new car sale but doesn't anyone actually know how much money is made on a base Prius?

    Say it's $1,500. That's fine, but how much profit is made on servicing every 10,000 miles? Whilst not as much over 5 years as a new sale it is still worthwhile and significant and if that was to be lost, then that's a significant loss of profit.
     
  20. SageBrush

    SageBrush Senior Member

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    Lucky for me, I was not drinking anything when I read this. Thanks for the long laugh :)
     
    #80 SageBrush, Sep 3, 2014
    Last edited: Sep 3, 2014