MILFORD — The pandemic housing market has forced many home buyers to pay well over listing price for a home, something that would have been unheard of 10 years ago.
Car buyers are now facing the same surcharges with some popular new SUVs, pickup trucks and even sports cars.
Paul Johnson, a Milford, Ohio, small business owner, was stunned by a $10,000 "market adjustment" over his new Cadillac Escalade's MSRP.
"When I asked about the price, they showed me what the sticker was, and I saw that they had added another $10,000 over the sticker," he said.
He had never seen anything like it in years of buying new cars.
"They told me that was what they were able to get for the car, because it is in such high demand," he said.
Johnson doesn't want to name the dealer, to avoid damaging his relationship with them.
He finally negotiated on a few things but still paid well over sticker price.
"It's insane, really," Johnson said. "You pay sticker, no negotiation, and if you don't like it, they will sell it to the next person."
We were unable to find a local new car dealer willing to speak publicly about the surcharges.
However, the best way to avoid running into this situation right now, according to the automotive website iSeeCars.com, is to hold off buying some of the most in-demand vehicles, including Jeep Wranglers and full size, three-row SUVs.
"Smaller vehicles, economy cars, traditional sedans, they haven't been hot for years," said Karl Brauer, senior analyst at iSeeCars. "So that's where you want to go if you want to save some money."
Brauer says vehicles with the highest average markups as of September 2021 include the:
- 4-door Jeep Wrangler: As much as $9,000 over sticker.
- GMC Yukon (along with GM's Tahoes, Suburbans, and Escalades): $7,000 over sticker.
- Kia Telluride: $5,000 over sticker.
- Hyundai Palisade: $4,000 over sticker.
Surprisingly, the study found, even some sports cars are selling for above sticker price due to shortages, especially the Chevy Corvette and Ford Mustang.
iSeeCars says it is not price gouging, however, because the sticker is only a "suggested" price.
That is what the "S" in MSRP stands for.
Dealers expect supplies to new vehicles to improve a bit this winter, when fewer people shop for cars, but the parts shortages and high prices are expected to continue into next year.
As always, don't waste your money.
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