Dodge's Markup Deterrent Dexterously Defeated by Dealers

Matt Posky
by Matt Posky
dodge s markup deterrent dexterously defeated by dealers

Even though we knew the limited supply of Dodge’s SRT Demon would drive up prices astronomically, Fiat Chrysler still made a valiant effort to reduce markups by prioritizing deliveries to dealerships offering the vehicle at (or below) MSRP. Unfortunately, the plan didn’t work as intended.

This was especially true after some dealerships found a workaround by having intermediaries on eBay auction off the right to buy one of their Demon allocations. Instead of selling the car above the $86,090 sticker, which forces Dodge to omit custom nameplates and other Demon perks, they’re allowing prospective buyers to bid on the “privilege” of purchasing a Demon at the manufacturer’s stipulated value — for thousand of dollars.

According to Automotive News, buyers are shelling out $10,000 to $70,000 to acquire SRT Demons at a “fair price.”

Last week, dealers in South Carolina, Louisiana, and Tennessee auctioned the right to purchase coveted Dodge with reserves set between $10,000 and $22,500. However, earlier auctions showed some customers hitting final bids as high as $75,000.

Ebay sellers have been clear that they are only tangentially related to the dealerships, specifying they have an “outside relationship,” as if they are indicating some kind of complicated romantic status via social media. One lister explained that “there will be somebody directly from the dealership contacting the winning bidder prior to any money being exchanged so that the deal is understood from both sides.”

If that sounds sketchy, it is.

Meanwhile, the majority of dealerships should be satisfied taking the honorable route of gouging customers upfront. Though a few have also decided to list regular Challengers at unheard of prices, in the hopes to subtly pass them off as Demons. We even spotted a couple of V6 cars carrying $80,000 totals online. Those examples appear to be anomalies, however.

In June, Dodge brand chief Tim Kuniskis explained the automakers allocation strategy while urging dealerships to play fair. “We know some dealers may be tempted to sell to the highest bidder,” Kuniskis said. “But we are encouraging them to leverage the Demon as a halo for both the brand and their dealership, to bring customers into their showrooms and see everything we have to offer.”

However, when you can sell something for thousands of dollars more than MSRP it’s difficult to resist the urge to do so. Finding a loophole that also permits you to adhere to the manufacturer’s stipulations is just icing on the money cake.

A few dealerships are attempting to reach a moral compromise, though. Bill Marsh Chrysler-Dodge-Jeep-Ram in Traverse City, Michigan told Auto News its sole Demon will be sold for one dollar below sticker price, with the right to buy it being auctioned off among existing customers for the “benefit of four local charities.”

According to Marsh’s marketing director, Mike Kent, the auction alleviated a problem for the dealership, “which [is] ‘How do you maintain the integrity of one-price when the value of the car goes beyond its MSRP?’ This gets us beyond that.”

FCA said it is monitoring dealer actions in selling Demons, but confessed there was little the automaker could do beyond encouraging dealers to sell their Demons at the manufacturer’s suggested retail price.

[Images: FCA]

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2 of 39 comments
  • Since 100% of all new cars are sold at MSRP, selling one for over MSRP is totally out of line...oh, wait....never mind.

  • Bikegoesbaa Bikegoesbaa on Jul 24, 2017

    "How do you maintain the integrity of one-price when the value of the car goes beyond its MSRP?" Perhaps launch with a higher MSRP? Would it be possible to not specify one at all? Just put the cars on the showroom floor and let the market determine their value without even trying to establish a sticker price?

  • MaintenanceCosts This is now our fourth 20th Anniversary GTI, and the third of those four that had major structural modifications for purely aesthetic reasons. I didn't picture Tim as the type to want to join the STANCE YO crowd, but here we are?
  • JMII This is why I don't watch NASCAR, it just a crash fest. Normally due the nature of open-wheel cars you don't see such risky behavior during Indy car events. You can't trade paint and bump draft with an Indy car. I thought it was a sad ending for a 500. While everyone wants a green flag finish at some point (3 laps? 5 laps?) red flagging it is just tempting people too much like a reset button in a game.The overall problem is the 500 is not a "normal" race. Many one-off competitors enter it and for almost every driver they are willing to throw away the entire season championship just to win the "500". It sure pays way more then winning the championship. This would be like making a regular season NFL game worth more then the Super Bowl. This encourages risky behavior.I am not sure what the fix is, but Indy's restart procedures have been a mess for years. If I was in charge the rule would be pit speed limiter until the green flag drops at a certain place on the track - like NASCARs restart "zone". Currently the leader can pace the field however they wish and accelerate whenever they choose. This leads to multiple false and jumped starts with no penalty for the behavior. Officals rarely wave off such restarts, but that did happened once on Sunday so they tried to make driver behave. The situation almost didn't happen as there were two strategies in the end with some conserving fuel and running old tires, driving slower with others racing ahead. However the last caution put everyone on even terms so nobody had advantage. It always gets crazy in the last few laps but bunching up the field with a yellow or red flag is just asking for trouble.
  • Tim Healey Lol it's simply that VWVortex is fertile ground for interesting used cars!
  • Jalop1991 I say, install gun racks.Let the games begin!
  • EBFlex For those keeping track, Ford is up to 24 recalls this year and is still leading the industry. But hey, they just build some Super Dutys that are error free. Ford even sent out a self congratulatory press release saying they built Super Duty’s with zero defects. What an accomplishment!