GM offers a range of highly desirable vehicles and enthusiast-oriented products, including the new C8 Chevy Corvette Z06 sports car, the battery-powered GMC Hummer EV off-roader, and the high-performance Cadillac Escalade-V. Now, GM Authority has learned that GM will limit the warranty transfer for these three vehicles, potentially curbing incidences of owners “flipping” high-demand vehicles for profit.
According to a document seen by GM Authority, GM is limiting the transferability of certain warranties and will prevent sellers from placing future sold order or reservations for high-demand models if a new owner resells their 2023 Chevy Corvette Z06, GMC Hummer EV (including both SUV and SUT models), or Cadillac Escalade-V within 12 months of ownership. GM indicates that these changes are intended to prevent these three high-demand vehicles from being quickly resold, a practice that can negatively impact GM’s customer experience and related GM brands.
GM notes that these changes will not impact product recalls.
Indeed, when it comes to high-demand vehicles like the new Corvette Z06, GMC Hummer EV, or Cadillac Escalade-V, it’s not uncommon to see these vehicles quickly resold at greatly inflated prices. When it comes to the C8 Chevy Corvette Z06, GM is also offering buyers 500,000 My Chevrolet Rewards points, a hefty $5,000 value, to those customers that retain ownership of their new vehicle for at least 12 months. This is once again intended to incentive owners to not flip their vehicle for a profit, with the points redeemable for things like GM Financial Payments, Chevrolet accessories, and more.
Of course, these efforts will undoubtedly fail in preventing all new owners from flipping their new Chevy Corvette Z06, GMC Hummer EV, or Cadillac Escalade-V for a quick buck. However, for those folks simply looking to get one of these highly coveted vehicles in their garage, every bit helps.
Subscribe to GM Authority for more Chevy Corvette news, GMC Hummer news, Cadillac Escalade news, Chevy news, GMC news, Cadillac news, GM business news, and around-the-clock GM news coverage.
Comments
Not a smart method. Just increase MSRP to prevent quick resale to happen.
Aren’t the “Stealers” already doing that ?
Well my theory is, if the consumers can’t flip them, then dealerships can’t add on the MSRP.
If dealers or individual buyers can sell GM vehicles at a price much higher than MSRP, it simply means the MSRP is set too low and is not a fair market price. A MSRP should be high enough to ensure the vehicles still can be sold, but dealers cannot add too much markup. For instance, if a base Z06 MSRP is $140K, dealers won’t be able to sell it for much more than $140K. Anyone, who really want Z06, will simply buy from dealers instead of looking for resale from individual owners. GM management should keep the profit in GM rather than giving it to dealers.
Seriously, who cares about GM’s profit. They certainly can figure out themselves what they need to ask for MSRP.
Hao, How stupid is that… I think you have a loose connection
Possibly Jd try expressing yourself with something tangible so we can all learn. You seem to have strong beliefs hidden behind emotional words.
So, it is OK for the dealers to mark these vehicle up 30 – 50 thousand for their profit, but not OK for an individual. They did not put enough items n place to stop dealers from doing such, but now want to punish the actual consumers.
I work at a Chevrolet Dealership that does NOT sell over MSRP as a company policy. GM is investigating dealers that are charging over MSRP and will cut off allocation if they find evidence that it’s happening. That’s on all models, not just high demand vehicles. I can tell you that there will never be enough production to meet the demand for the Z06.
The dealers are still doing it .Chevy just looking the other way !!
After 4 years I find it incredible that GM is just now hearing that dealers have been doing this. Out of touch is what I say. If GM really cared about the ADM they would renegotiate their agreements with the dealers and prohibit ADM
Nice to hear that your particular dealership is not marking up vehicles but just about every other dealer is, GM, Acura, Audi, Porsche the list is endless. Ridiculous amounts in some cases. Karma is going to be a real b!tch for these unscrupulous and unethical dealerships. And for those that say its just demand, then to an earlier comment, the manufacturer should have increased the MSRP in line with demand and inflation, not allow the dealer to do what they want and smirk while doing it!
GM is doing nothing because they can’t and why would they Corvette is selling I just have a hard time believing that there are shortages still for this car I mean they have been building it since 2019
What don’t you understand about supply and demand? And why should a dealer be held to selling at MSRP with about a $15,000 gross profit if the buyer can and will then resell it for $50,000 more than MSRP? Why is it ok for a buyer to resell for $50,000 over MSRP but not the dealership? And if MSRP is all a dealer should ever sell anything for, even low availability-high demand units, then are you ready to pay MSRP for every vehicle you buy in the future, even overstocked models and not shop around looking thousands off? Hypocrite much?
For me, it’s about integrity and trust: I would never buy a new car or especially a used car from a dealer who would try to charge me more than list price on a new one. Also, I would never buy a car from someone who had purchase a car from a dealer with the intention of flipping the car for a profit. Good business practices makes for returning customers…..if it’s all about the money, I trade somewhere else.
Do you work for free. We work jobs that make us money, no matter what it is and dealers aren’t different. You can say it all day every day but at the end of the day, every job is done because of money.
Your statement also applies to drug dealers……I don’t do business with them either.
Bob Lutz:
I have to congratulate and thank you. You are one true car guy that thoroughly knows and understands this very complex business. A rarity in today’s automotive world.
While GM tries to remake itself into a higher end automotive entity while going ” all in ” in very dangerous uncharted waters with EV’s, I hope that GM is tapping expert savvy old timers like yourself as a guide in this new rough sea.
I’m spooked and concerned about this ” all in ” direction. Most of the emissions they are trying to abate are coming from the second and third world and human waste emissions from 8+ billion souls on this planet.
If Uncle Sam mandates EV’s which is very plausible at this time, GM will be in the Catbird seat. I think Mary is taking this to the bank. She and Brandon have been in private discussions I’m sure, since she is reaching out for more unsecured bond money.
Most of the emissions they are trying to abate are coming from the second and third world…..
Suggest you do a bit more homework. US is the 2nd largest in the world, behind only China, in Greenhouse Gas Emissions for 2020 and amongst the highest GHG per capita. So Republicans (I take it that is your persuasion given the term Brandon) may think this is all a big old hoax but your grandkids sure as hell won’t.
What flavor of cool aid do you like the best?
Another election denier
What you dont understand that these people you are charging over sticker for used their tax money to bail you out from going bankrupt and this is the thanks we get for doing so !!!
I think Mary and Farley over at Ford must be dating…. but she is not paying attention… Farley IS going after the dealers that jack the “suggested retail” price of vehicles while Mary is just going after the flippers…
There is a cure for dealers boosting retail prices… Ask the dealer for a “detailed” copy of the vehicle build sheet… It will be about 20 or so pages and the dealer can print it up in 2 minutes… ask for a copy of the vehicle detail sheet from the factory that is stuck on the glass of new vehicles at the factory. That has the factory’s suggested retail price with a condensed listing of options. An honest dealer will gladly give you both. I have both in my file. Given the nature of the vehicle supply and demand, I did not negotiate but paid sticker price for the vehicle BUT, I got them to sharpen the pencil on things like the good quality preformed floor mats, etc…
None of this matters. What did it turn at the Ring. Seems like they forgot to tell us
GM and it’s dealers are tied into the mandatory ADP monthly whole good reporting system for new vehicles. This accounting system tracks sale price and profit margins per each new vehicle sold within the month for the factory data banks. This data is used for marketing and planning purposes. GM can slap rogue dealers hands that are hosing the public by pricing above MSRP.
Female new car buyers often have a higher gross profit margin from the ADP reports, whereas male new car buyers have a lower gross profit margin. Male new car buyers are much more savvy on car product and vehicle bargaining skills than female purchasers.
My ex wife goes to a dealer for a new car, sees one she likes, and tells the sales person I like that one, write it up, my trade is parked over there.
In 1986, I priced a Honda CRX. It was 5% over the MSRP. I went up the road to the (then new) Acura dealer and ordered an Integra at MSRP and got a better engine in the process.
OK, so someone with their heart set on one of the three GM models cited may not have a similar option.
This is a good start by GM but not enough. GM should punish the dealers that do the markups. I’m sure GM has known for many years about dealer markups and I wouldn’t be surprised if they get some kind of kickback or incentive for doing it. I believe and this is my opinion that a small percentage of markups go back to GM and the rest goes in to the franchise owner of the dealership. This is a symbiosis relationship between dealership and GM.
This may very well slow down the flipping (which is good), but using this method instead of (for example) contractual limitations to buyers is focused on getting GM off the hook on warranty expense for what is likely going to be a very expensive repairs (esp. the z06 engine and prob all of the Hummer) with uncertain/unknown reliability. GM is looking at their bottom line first here, not solely the brand…perhaps financially smart in the short term, but not a good look IMO, esp. when they are not effectively controlling dealer mark-ups at all.
There are numerous legitimate reasons a buyer might need to sell their car in the first year without being a flipper…health, job change, just hate it, etc. And for these products, we’re all buying something we can’t even test drive first…
Now they can SAY in videos all they want that the z06 engine will be reliable (from racing experience. etc., etc) but actual reliability won’t be known until the car is on the road for some time…and Chevy already has a bad track record here, putting out engines with reliability issues on the last 2 generations of Z06 (overheating on the c7z and valve issues on the c6z).
I went from being very excited about the new z06, to being not sure anymore…and the pricing (which notably was higher than what their own marketing person said it would be) was only a small factor in this change for me…I just really don’t like what I’m seeing from GM across their range of products, and I’ve been a GM enthusiast my whole life…hope that I’m seeing things better when my spot in the z06 line comes up.
Engine life, performance and durability takes at least three years to fine tune in user field populations for a new engine. Some new models of engines never get it right. Examples being the Cummins 555 and Caterpillar 348 and 349. They lead a long slow user death over several years.
Henry Ford and Clessie Cummins were best buddies. Both attended to the Indianapolis 500 together each year and sat in the same box. It took Henry 3+ years of design and development before releasing his famed flat head V8, and then some field time afterward by users to perfect it.
Clessie Cummins wanted to mass produce his diesels for automotive applications and asked Henry about this. Henry advised Clessie not to make this pioneering move and to stick with lower volume production commercial truck diesels. The reason being is the warranty risk and costs of parts and service in a new high volume engine will eat the lunch of a small to mid size manufacturing company which Cummins Engine Co. was at that time in the 1930’s.
Henry told Clessie that Ford Motor Co. being a huge manufacturing operation with huge cash flows could weather a warranty storm on a high volume of warranty claims on a new product. Further, that all new engine designs have a warranty challenge during the first couple of years in the field.
GM’s Detroit and Cleveland diesel divisions faced this challenge during new engine development and release in the 30’s, 40’s and 50’s. Uncle Sam was Detroit Diesels angel buying bazillions of Detroit and Cleveland diesels during World War 2. With this volume, field repair and revenues, Detroit Diesel became a cash cow for GM and a mainstay go to leading choice diesel engine for the oil and gas industry due to the Detroit Diesel’s fantastic rap up and draw down in drilling applications.
Engine making is a very challenging and complex business. That’s why truck, aircraft and military equipment makers go to specialty engine vendors for this component.
Electric motors are downright simple compared to an IC engine. That’s why automakers are loving and embracing the change to EV’s. An EV costs about 30 to 40+ % less to produce than an IC vehicle, but can command a similar or in some cases a greater price for a comparable IC vehicle. This is symphony to the car makers.
I agree with your comments. I traded in my 2019 z06 for the c8 z06 with uncertainty of the reliability of this new 5.5L engine. I did have cooling issues with my c7 but only if pushed hard on a hot day. I’ve waited 2 years on the list and 10th in-line. But like you said how reliable is this new platform going to fair out over 2-5 years and beyond.
I’m not a lawyer – but one would think there’s going to be a lawsuit coming on this.
For sure, especially when GM fails to offer a way for buyers to check this information out prior to purchase.
And knowing GM, that certainly is in the realm of possibility.
The prices are out on the new Z06, if you order one or even if you buy one from non dealer, the build and price on the Chevrolet web site will tell you about what the list price is. This should tell you if your are paying an inflated price.
I am pretty frustrated with what’s going on in the world of Chevrolet and the corvette. Due to so many extenuating circumstances, Chevrolet cannot keep up with the demand for the new corvette. I worked on the assembly line in Tarrytown, NY during the 70’s and numerous dealerships later on in my life. I think I can consider myself a knowledgeable car guy, having ordered and owned over 25 corvettes in my life. I was lucky enough in 2019 to get a ZR1 as part of the last batch of 50 made, of which only 4 could be built from scratch, and have it sent to a dealership of my choice. That dealership originally had an an allotment of 2, for which they charged 10 and 15 thousand over sticker price respectively. I was charged sticker price since they had nothing to do with the original order. I just called them now about ordering a new ZO6 and they were kind enough to tell me that as a loyal previous customer they will only charge me 25 thousand over sticker. Really? Like GM is really going to punish dealerships that they “just found out” were gouging customers over the years for any hot product. I get the economics of supply and demand, but at some point the ripoff pricing dealerships need to be put on notice or out of business. Haven’t these dealerships learned that customer loyalty always beats out one and done?
What don’t you understand about supply and demand? And why should a dealer be held to selling at MSRP with about a $15,000 gross profit if the buyer can and will then resell it for $50,000 more than MSRP? Why is it ok for a buyer to resell for $50,000 over MSRP but not the dealership? And if MSRP is all a dealer should ever sell anything for, even low availability-high demand units, then are you ready to pay MSRP for every vehicle you buy in the future, even overstocked models and not shop around looking thousands off?
To protect and promote the brand, that’s why. The Corvette brand has incredible value that has been built over nearly 70 years…that brand value should and can be protected by temporary economic / political conditions.
Some dealers claim they do not mark them up like Stingray Chevrolet in Plant City Florida don’t bet on it I called ahead and check the price of one advertised got there and they Jack it up 30 grand on me I was told on the phone prior to Going the Distance about 40 miles each way that they do not mark them up and I get there only to get bait and switch happened to me last year and the salesperson was smug about it when I told him I’m not going to go that high he said I didn’t think so yes did happen
MY DEALER SAID HE REALLY APPRECIATED MY BUSINESS TO AND WANTED 20,000 OVER STICKER AND HAVE BOUGHT MOST OF MY CARS FROM THEM IN THE 54 YEARS THAT I HAVE DRIVEN….CUSTOMER APPRECIATION …YEA RIGHT
You might want to describe your experience in detail on the BBB site and let your dealer know that “what goes around comes around, comes around”.
I think it is great!
Now GM, do the right thing for your valued customers NO ADDED MARKUP (ADM)!
Jerry
Yea their valued customers are the ones that have big bucks and its the small guy that made the CORVETTE what it is today !!!
I highly doubt that the flippers or the “customer” willing to way, way overpay to get one of these vehicles cares much about this?? Can’t reorder?? Flippers always find plenty of ways around silly “rules” like those.
I’m first in line at our local dealership and getting my ZO6 at MSRP. I am not buying it to flip. The dealer has had my money for three yrs now and Im also first in line for the first ZR1. When you consider that there is no chance of testing a ZO6, they won’t give us any idea of what it ran at the Ring, and now they tell me that I have to tie up $150,000 on a car that I can’t sell for a yr even if I don’t like it.
Since when has GM become such a big deal that they can control what I do with my money.
Since when has GM become such a big deal that they can control what I do with my money
Since you let them…
There are nine Hummer EV’s listed on ebay right now and all are priced over $200k
Houstonian:
There is a sucker born every minute.
So let me get this straight. I buy a new ZO6 with no intention of flipping it but some hardship happens in my life and I lose everything. I have a $150k car sitting in my garage and I have to keep my car because GM says so.
In the meantime the dealers can charge over MSRP and make more than GM ever intended them to make on it.
On top of that the cost of the ZO6 is bringing prices of Stingray back up. I can still buy a Stingray and flip it for a profit.
A person would have lost everything, and would be parking it back at the dealer. It would hit hard, as I would say giving 30k over MSRP would be part of their equation why.
We are a free market society; if companies want to charge a premium, they should be allowed. Customers can shop around as they do for all products and ultimately decide what they want to pay for the product. If a dealer marks up the vehicle by x amount and a customer wants to pay for it, it’s their choice, no one is forcing them to buy it. That said, it is the customer’s choice when purchasing a vehicle, completing the transaction, and deciding to sell the next day, week, month, or year not the manufacturers. If the manufacturers elect to void the warranty if the owner decides to sell the vehicle prior to x amount of time per their sales contract, the manufacturers will lose customers and open themselves up for litigation.
That free market society is the same one that protects a manufacturers warranty and a dealers legally contracted clearly written warranty restriction. I’d like to see a judge try to untangle something a person voluntarily agreed to. It could be worse. A Las Vegas Ferrari dealership owner violated a contract by flipping a personal owned La Ferrari before 2 years and lost their franchise. No better example of a free market.
GM CAN THEIR NEW CAR AND STICK IT ILL KEEP WHAT I GOT AND FOR ALL YOU PEOPLE WITH MORE MONEY THAN BRAINS GO AHEAD AND PAY OVER STICKER !!!
I am curious about the use of the words ‘certain warranties’ used by GM. Has there been an explanation of what ‘certain warranties’ include?
According to a document seen by GM Authority, GM is limiting the transferability of certain warranties and will prevent sellers from placing future sold order or reservations for high-demand models if a new owner resells their 2023 Chevy Corvette Z06, GMC Hummer EV (including both SUV and SUT models), or Cadillac Escalade-V within 12 months of ownership.
Also agree with prior posts that this is truly a double standard if GM continues to allow dealers to mark up vehicles above MSRP but take away the rights of customers who potentially do the same thing as a planned or unplanned event. So far they have only sent out letters (for PR reasons) to dealers encouraging them not to mark up vehicles but clearly do not intend to take action to actually stop them from marking them up. Will they cancel orders from dealers because of this behavior like they are going to do to their customers?
The quickest way to stop dealers from marking up above sticker price is for the buyer to refuse to pay anything over the factory sticker price for a vehicle. An honest dealer will provide the buyer with a copy of the window vehicle sticker with the price on it. An honest dealer will also provide the customer upon request a detailed build sheet of the vehicle (15 to 20 pages long).
Have a backbone, expect honesty from your dealer or move on to a dealer who will be straight with you. Also, If a dealer tries to scam you, report it to GM head office, that dealer’s allotment will likely be “adjusted” to teach them a lesson.
Dee Hart
If an auto dealer tries or is scamming you, contact the consumer affairs or fraud intake division at your state’s Attorney General’s office. However you must realize that a dealer can ask any selling price they want. If they rip you off on warranty, service, re do work, each state has within their Department of Motor Vehicles a unit that handles these issues. Lastly you have the Better Business Bureau (BBB), and small claims courts to handle complaints. Attorney’s are a crap shoot in handling complaints. They like to take your money and let the case ride.
What I am saying is simply, hold the dealer accountable… Most are, but those few that get away with this BS are making it bad for all dealers. I am not just talking about GM. When shopping for a new vehicle I was also shopping for Ford as well… They also have their issues on the showroom floor… I just won’t put up with it, that’s all.
GM cannot limit warranty transfers on individual buyers without the ensuing litigation. To previous comments, GM cannot let the dealers go unchecked, as they have done for the last 18 months, charging huge mark-ups and gloating over it, and then prevent an individual from selling the vehicle by limiting the warranties that come with the vehicle. This is not a very limited production Ford GT (where you have to sign a legal document stating no sale before 2 years of ownership), this is a mass produced sportscar. I am on a list to buy at MSRP. If I want to resell it, that is up to me unless GM makes me sign a Ford GT type contract at the time of ordering.
We’ll said and I totally agree… It is just amazing that GM doesn’t get a grip on this situation and fix it! Jerry
That’s what they are going to do and if you buy, you sign the agreement acknowledging the restrictions. If you want to sell, it’s yours to do so. Your buyer will lose “certain warranties” but that’s on them. The other stipulations have been mentioned and the perks that you will lose. It’s a contract. If you sign it you are bound to it, no matter if they make a million Z06 in first 6 mo of production. They have more money and better lawyers than you. If you’ve been on the list for a long time, then what’s the big deal over 12 mo, unless you’re a flipper. Then again, you can sit and look at it in your garage for 12 mo, then flip it for 200k. I don’t see a problem. I think the 106k to 130k is going to keep production lower than expected. I don’t see a mass Z06 build even at MSRP. It’s not worth that for my money, I’d rather put that down on a used Ferrari or Lambo. Just my opinion.
All of people with more money than BRAINS would quit buying them everything would be ok !!! NO I GOTTA BE THE FIRST TO HAVE ONE
I DONT BELIEVE NOTHING THE CHEVY BRAND TELLS ME ANY MORE…..AND IM SURE THEY DONT CARE !!!
Sticker will do you don’t need the build sheet all of the options are public knowledge Most buyers know more than the dealers and especially the salesmen anyway. If you are bound by paying a deposit on an order then make the dealer be bound to stick with the sticker price in writing. That’s it. What I don’t get is if they can sell everyone built why do they want YOUR money to order a C8?