GM Tightens Dealer Margins on 2016 Chevrolet Corvette

By

Senior Pricing Analyst

Alex Bernstein is the Senior Pricing Analyst for CarsDirect.com. Each month he studies immense volumes of pricing and incentives data in search of trends that are useful to car shoppers. In the process, he often breaks industry news stories -- his analyses and insights have been featured on websites such as Automotive News, The Detroit News, Autoblog, The Truth About Cars and The Car Connection.

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, Senior Pricing Analyst - July 23, 2015

The Chevrolet Corvette has proven a rare ability to sell well with minimal discounting. But what happens when an automaker wants to make more money while making it look like nothing has changed? In a strategy shift, GM has increased invoice prices as much as $2,032 on the 2016 Corvette, cutting into dealer margins. The changes aren't obvious but could affect prices quoted by dealers. Here's what you need to know.

A hot seller

While the Corvette is undeniably a top performance value, it continues to command premium prices. This isn't deterring sales, however- GM sold 3.1% more Corvettes in June versus the previous year, according to data from Automotive News. Along with getting no special incentives, Corvette prices haven't changed much. Until now.

Read our overview of the 2016 Chevy Corvette »

Tinkering with margins

On the surface, Corvette prices aren't going up by much for 2016. All trim levels are getting a modest $400 increase in MSRP. However, what's more concerning is what's happening behind the scenes with invoice prices.

The changes aren't obvious, but GM has raised invoice prices by an average of $1,705 across all trim levels. On the base 2016 Stingray Coupe, the invoice has been raised $1,472 from $50,050 to $51,522. The spread between MSRP and invoice prices, sometimes referred to as the dealer margin, has been cut on that model by $1,072.

The effect is more pronounced on the upper trim levels. The most expensive model, the Z06 Convertible, is getting a $2,032 hike in invoice price. Its spread between MSRP and invoice has consequently been cut from $7,470 on the 2015 model to $5,838 on the 2016, a $1,632 change.

Trim MSRP (2015) MSRP (2016) MSRP Change Invoice (2015) Invoice (2016) Invoice Change
Stingray Coupe $55,000 $55,400 $400 $50,050 $51,522 $1,472
Stingray Convertible $59,000 $59,400 $400 $53,690 $55,242 $1,552
Z51 Coupe $60,000 $60,400 $400 $54,600 $56,172 $1,572
Z51 Convertible $64,000 $64,400 $400 $58,240 $59,892 $1,652
Z06 Coupe $79,000 $79,400 $400 $71,890 $73,842 $1,952
Z06 Convertible $83,000 $83,400 $400 $75,530 $77,562 $2,032

*Prices exclude a $995 destination charge.

Not unheard of

Automakers sometimes have a need to make more on certain hot cars without stinging shoppers with a higher MSRP. Last year, we saw something similar in October when Chrysler (now Fiat Chrysler) hiked invoice prices on the red-hot 2015 Dodge Challenger SRT Hellcat by $900 while keeping the MSRP unchanged.

Side-by-side: 2016 Corvette vs. 2015 Challenger SRT Hellcat »

Our take

It's likely that dealers will rethink how much they discount the 2016 model, if at all. Some dealers may feel a need to make up for this in some other aspect of the transaction. For shoppers, now may be the best time to consider a 2015 model before they become hard to find.

Get a free quote on the Chevy Corvette »

Unless specified otherwise, incentives listed here are based on a resident in Southern California. Lease offers are based on top-tier credit and exclude tax, license, title, registration, document fees and insurance. State-level incentives can vary, so please check with your CarsDirect Trusted Dealer to confirm all available offers in your region.

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, Senior Pricing Analyst

Alex Bernstein is the Senior Pricing Analyst for CarsDirect.com. Each month he studies immense volumes of pricing and incentives data in search of trends that are useful to car shoppers. In the process, he often breaks industry news stories -- his analyses and insights have been featured on websites such as Automotive News, The Detroit News, Autoblog, The Truth About Cars and The Car Connection.

Follow On: Google+ | Website