Keeping up your guard buying OEM parts at a new car dealership

GON

GON

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Something I discussed before, but thought yesterday's example is worth posting.

I have a 2005 Lexus GX 470. I only have the "valet" key, not the master key. I think best practice is to have two master keys, as the valet key has limited functionality, to include its inability to make a duplicate master key.

Yesterday at lunch I went to a local Lexus dealer in person to get a quote (picture of quote below):
List : $284.99 (per key), nice guy discount reduces price to $252.90 (per key). Washington state sales tax adds another 10 percent to the price. I took a pass.

Had insomnia at 2am this morning, so did the research.

MSRP on the key is $166.16 (Lexus part number 8907060801), online price $137.33.

Amazed at the almost double the MSRP b

Below is my purchase price from Bell Lexus of Scottsdale (great parts dealer)
Order Contents:
P/N​
Quantity​
Price Each​
Description​
8907060801​
2
$ 137.33​
Keyless Entry Transmitter


Order Summary:
1 products , 2 items​
$ 274.66​
Coupon​
- $ 24.95​
Shipping & Handling to WA, USA​
$ 24.95​
Total​
$ 274.66​

PXL_20231019_162822076.jpg

 
The Critic said:
It’s called Matrix pricing.
Click to expand...
Googled "matrix pricing":

Dealerships often mark-up the price of these OEM parts from 10% - 1,000+% beyond the MSRP (Manufacturers Suggested Retail Price)? Yet with just a little bit of effort you can sometimes prevent unnecessary claim cost allowances that can range in the thousands on one repair.

Without a watchful eye for these gouging techniques you are often at the mercy of a dealership charging way beyond the MSRP for parts. However, verifying the actual MSRP and confronting the dealership often results in them accepting the MSRP on each part. It is impossible to tell which dealers are gouging unless you have someone verify the MSRP on each part. On certain types of claims requiring lots of mechanical and electrical repairs the savings can be huge. The specific technique most dealers are using is known as Matrix Pricing, and it can be both a bane and an opportunity on many types of expensive vehicle claims.
www.linkedin.com

The Insanity of Dealership Matrix Pricing?

Tech Check, ADJUSTERS WEEKLY: #19 “What do you want to charge me for that part?” Have you noticed the steady and sometimes outrageous increase in parts prices coming from vehicle dealerships today? Repairs involving a lot of expensive mechanical and electrical parts like a wiring harness that costs
www.linkedin.com www.linkedin.com
 
GON said:
Something I discussed before, but thought yesterday's example is worth posting.

I have a 2005 Lexus GX 470. I only have the "valet" key, not the master key. I think best practice is to have two master keys, as the valet key has limited functionality, to include its inability to make a duplicate master key.

Yesterday at lunch I went to a local Lexus dealer in person to get a quote (picture of quote below):
List : $284.99 (per key), nice guy discount reduces price to $252.90 (per key). Washington state sales tax adds another 10 percent to the price. I took a pass.

Had insomnia at 2am this morning, so did the research.

MSRP on the key is $166.16 (Lexus part number 8907060801), online price $137.33.

Amazed at the almost double the MSRP b

Below is my purchase price from Bell Lexus of Scottsdale (great parts dealer)
Order Contents:
P/N​
Quantity​
Price Each​
Description​
8907060801​
2
$ 137.33​
Keyless Entry Transmitter


Order Summary:
1 products , 2 items​
$ 274.66​
Coupon​
- $ 24.95​
Shipping & Handling to WA, USA​
$ 24.95​
Total​
$ 274.66​

View attachment 184268
Click to expand...
CROOKS
 
The Critic said:
At MSRP, the margins are insufficient, especially for dealing with the general public. A lot of manufacturers will pay their dealers well over msrp (for parts) on warranty repairs.
Click to expand...
Plenty of dealers sell at or below MSRP and have for decades and have remained in business with that model. The "matrix" model appears to be born from dealership groups that have many dealerships.

"At MSRP, the margins are insufficient, especially for dealing with the general public. " - hmmmmmmm really???

" A lot of manufacturers will pay their dealers well over msrp (for parts) on warranty repairs."- i would love to see posted/ actual examples of that.... I would have to see that to believe that.
 
Last edited:
I have been buying parts at

Genuine Lexus Parts | Park Place Lexus Plano

Shop OEM parts for your Lexus online from Park Place Lexus Plano. Thousands of original equipment parts, shipped fast from Plano, TX.
parts.parkplacelexusplano.com

They have free shipping, not sure for big parts.
I got a keyfob for 2010 RX350 for $120 which is a little more than buying used on Ebay.
It did not include the metal key, though, I don't need it anyway.
 
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GON said:
Plenty of dealers sell at or below MSRP and have for decades and have remained in business with that model. The "matrix" model appears to be born from dealership groups that have many dealerships.
Click to expand...
Over the counter sales represent a very small portion of a parts department’s overall sales.

GON said:
" A lot of manufacturers will pay their dealers well over msrp (for parts) on warranty repairs."- i would love to see posted/ actual examples of that.... I would have to see that to believe that.
Click to expand...
Next time you get a warranty repair, see if they’ll show you the internal copy.

eljefino said:
Play me the world's smallest fiddle. Dollar tree deals with the general public and still makes money somehow at $1.25 per item.
Click to expand...
Different industry with a different cost structure, not a relevant example.
 
Amazing. I always to go Lexus Parts or Toyota Parts Now to do my research. Ya'll just gotta find honest parts guys and take care of them. I stay loyal to my Lexus guy. GON, it seems you now have a good parts dealer.

Here's a good story. Getting the bumper painted on my '98 LS400. The car my wife says will be my urn. Body shop was quoted $700 (retail $788) from a different dealer. I called "my" guy and he just happened to have one in stock and he sold it to me for $480. There are a few good dealers around. I do have to drive 1 1/2 hours one way but it is worth it to me. I have 100% trust in him. When I got there yesterday around lunch, the Parts Manager was making 2 bologna and mayo sandwiches for lunch. Who can't trust a bologna eater????
 
I order parts online from car dealers online storefront who happen to sell below MSRP mostly. Shipping varies but one is near brother who can pickup.
 
Two master keys were provided when we purchased the LS400 in '07. Missing was the Valet and credit card key.

A few years later, my wife had her purse stolen, her Lexus key within. In those days, Sewell Lexus in Dallas was the go-to for parts and keys. Too bad they stopped doing online/mail order.

After including required proof of ownership and VIN, I ordered replacement master and Valet keys. Delivery took about a week. IIRC, the invoice was ~$300 (shipped) for both keys.

A lot of people buy these old LS400's and are ignorant about the keys, thinking that any old ebay replacement key will work. This is probably out of date, but a good rule of thumb is never buy an old Lexus/Toyota without at least one, original master key. Or researching the use and operation of the keys for that particular model year.
 
Matrix pricing has been around a long time, at least for the Euro marques, and for the savvy shopper, rendered the local dealer the last resort, only for urgent needs.

Like an idiot, I victimized myself recently by forgetting to order a drain bolt sealing ring with the rest of the parts for the job.

Factory MSRP $0.77
Local dealer RP $4.31
Parts house Genuine $0.39-0.99
Parts house OEM brand $0.02 - 0.25

Or course, small potatoes in the overall scheme of things, but can't escape the principle of the matter.

Especially when these dealers are willing to discount 20-25% off true MSRP through their mail order parts businesses. Insufficient margins? That's hard to stomach when they're selling though that channel at a discount, and usually have dedicated people to handle that business to make it worthwhile. I'll hazard a guess they don't work for free handling and shipping those orders, so no saving on the labor cost.

OTOH, there is the also the possibility of the counter guys who practice good karma, and will simply give you one one gratis, like I've experienced at a couple dealers for other marques.

If my old parts guy at the original one hadn't retired, he'd have done the same. But despite making it as easy as possible for the current guy, by giving him a number, so all he had to do was to enter and pick, he didn't budge.
 
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