[loc]

Capitalism has taught me that if you can find a product at a cheaper price, why not buy it? If a cust has found another A5/S5 at a lower price, why shouldn't he be able to cancel the current order and go to another dealership?

If anything, the dealer should either negotiate with current cust to get them to stay or lose the sale, simple as that. It works in all the other industry, why should the auto dealership be any different?

Well, it is called a contract, isn't it? You sign a contract when you order a car. The dealer will have to honor their part, you honor your part of the deal. Contracts are as much a part of capitalism as anything.

Apparently Europe and U.S. differ in the way deposits are handled. Where I live, the deposit is refunded only if the dealer can not deliver (or some other consumer protection clause kicks in like serious illness). If you go AWOL on the purchase, the dealer gets the deposit that helps them unload the car you specced and ordered at a reduced price.

That said, a deposit is not always required for ordering a car, I have personally never paid one but I would understand if they asked for it for some exotic customer ordered combination that might be a hard sell.

As for the person asking, I believe he is in the U.S., so this was only some global perspective on the issue - it doesn't really help him with his question.

 

[loc]

I don't know if it could really be considered a contract since most of us were not even given pricing at the time of order.

-Ray

Fair point.

 

[loc]

In California at least, it is illegal to have a non-refundable deposit. The purpose of the deposit is so that you won't go ordering 5 cars at 5 different dealerships. Unless you have a bizarre order, as stated previously, there's no reason that the dealer won't make equal or greater money whether you buy it or not, especially on a hot car like the A5/S5.

But why would it stop you from ordering 5 cars from 5 dealerships, paying refundable deposits on all of them, and then eventually buying just the one that gets here faster or the cheapest? And refunds from everyone else. Sure, the amount of money tied in might be an issue for some, but certainly on a hard to get car like A5/S5 (used to be anyway) someone might do it... In fact, reading forums I see a some U.S. buyers actually did it. Anyway, that is the reason why non-refundable deposits would be useful for the dealer, as a means to better enforce a contract to buy. (Having said that, the situation in the U.S. is also somewhat different in that it seems far more random which dealers actually get cars than it does where I live, and no pricing known beforehand, so ordering an A5/S5 wasn't as tight a contract on either side of the deal. I have never had to order a car without knowing the price or the dealers ability to actually get one.)

I guess the fact that U.S. cars are sold using a simplified options list and the culture of buying cars off the lot helps and thus makes this less an issue. In Europe a lot of cars are ordered from the factory (much more so than in U.S. I'm told), so a cancelled car already sitting at the dealer - especially one with exotic options that people might not normally order from the factory (the options lists are very long here) - will be harder to sell because a lot of buyers either want to spec their car themselves (the ones ordering a lot of options) or want a cheaper basic model off the lot (and won't want to pay for options they weren't going to buy in the first place).