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The Truth About Car Dealer’s Employee Pricing Programs

by | Nov 30, 2021

Promotions that use employee pricing are clever. They grab our attention by promising deep discounts, just like the AAA card does when it offers discounts at certain merchants. Car manufacturers want us to believe that employees get special deals. That’s why they promise employee pricing.

Employee pricing is quite a desirable form of incentive for many people because of how it promises the kind of deep discount that you would expect an employee of the car company to enjoy. But does it really work? Let’s look at the facts.

What is Employee Pricing?

Employee pricing is a marketing ploy used by car manufacturers to attract new buyers. It offers a discount to auto buyers who qualify as employees. Car dealers have been using employee pricing for years. It’s a marketing strategy that dates back to the early days of Henry Ford, where he gave his employees a discount on Ford Model Ts.

Nowadays, employee pricing is known as invoice pricing. This is usually given by car dealers to customers so they can offer a car’s MSRP (Manufacturer’s Suggested Retail Price) but with a lower price that is not as high as MSRP. They do this even to the point where the dealer is no longer making any profit from the sale, or at least that’s what they’d tell customers. Let’s look at what different car manufacturers and dealers have to say about their employee pricing programs.

Here’s a breakdown of some of the main proponents of employee price discounts.

Ford Employee Pricing

The company says its employee-discount program makes sure that the iconic auto manufacturer’s employees pay the same price that an employee would pay. The company has been offering this promotion since the year 2000, and it has given this benefit to over 25,000 employees and their nonprofit organizations. You can get a car with an MSRP of $67,799 and a “suggested price” or “invoice price” of $61,799 when you qualify for the 2% employee discount.

FCA Employee Pricing Plus

Fiat Chrysler Automobiles (FCA), which includes popular brands like Dodge and Jeep, offers employee pricing discounts to eligible employees of affiliate companies similar to GM’s Preferred Pricing model. However, Employee Pricing Plus extends the availability of this deal so that all car buyers can essentially enjoy the discount. Employee pricing for a Dodge Ram, for example, can range to 5% below the dealer invoice price, plus a fee.

GM Preferred Pricing

Comparatively, General Motors is a little more selective with whom they offer the Preferred Pricing discount. The company offers the program only to Canadian employees working for an eligible company or to spouses of eligible employees. The Preferred Pricing deal is similar to Ford’s employee pricing, so the discount is 2% below invoice price. It also must be purchased through a participating dealer.

Hyundai Invoice Pricing

Korean auto giant Hyundai offers a few deals that you won’t find advertised to the general public. These deals, though, aren’t exclusive to employees. The company offers invoice pricing, which is the same as employee pricing, and other deals that anyone can take advantage of.

Conclusion

Employee pricing is a marketing gimmick that works because people believe it. If you are looking for a deep discount on a new car, you have to realize that employee pricing is essentially like getting a discount and it isn’t something super exclusive.

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