Ryan Day¹ describes how the rise of independent auto dealers is a “gray swan” event for the automobile industry. This was not only bound to happen, as observed by the author, but also long overdue. The article states, “...current state laws prohibit OEMs from selling new vehicles directly to consumers (D2C). Selling directly would cut out the dealership franchise—the middleman—and all the associated price markup fees. This could theoretically save car buyers an alleged 30 percent of the cost of a car.”

This problem has been known for decades, and it is not something the supply chain’s value-adding stakeholders should continue to tolerate. Dealerships do not add value to the transaction, but if the 30 percent figure is correct, then $7,500 of the price tag of a $25,000 vehicle constitutes pure waste. My recommendation to consumers, as an immediate recourse in the absence of changes of the laws in question, is to game the system by waiting until the end of the model year to buy a new car. The car is still new but, as it is now last year’s model, the dealership must offer a substantial discount to get it off the lot to make room for more inventory.

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