Chevy Gets Hard Core With Corvette Flippers
Many car manufacturers don’t want you making money on their backs. If one of them sells you a car for X amount, you can’t make a chump out of them. You can’t sell it for twice the price. Yet, when it comes to Ford Broncos, Mustang Mach-E EVs, Redeye Widebody Chargers, and the first batch of C8 Corvettes, buyers can’t resist making a few grand, or more, by flipping them soon after taking delivery. Now, Chevy wants to create as many body blocks as it can to thwart the flippers of its Z06 Corvette.
What is GM doing about Corvette flippers?
To that end, it has contacted all of those who have ordered a Corvette Z06. GM will give them $5,000 if they keep their new Corvette for a year. But now, it is going even further. Chevrolet now says, “We are limiting the transferability of certain warranties and barring the seller from placing future sold orders or reservations if the vehicle is resold within the first 12 months of ownership.”
GM North American President Steve Carlisle sent this out recently. When a popular GM vehicle is resold for more money, it isn’t good for the customer, and especially the brand. He also reminded dealers of GM’s requirements and policies about resale.
Not only is the Corvette Z06 part of this “certain warranties” restriction, but this also applies to the Cadillac Escalade-V and GMC Hummer EV. So this is a two-pronged attempt to give flippers a reason to consider their profit-making instincts. It also means that those who placed an order, if they flip it, can’t do it a second time.
How does this affect secondary buyers of Z06 Corvettes?
This practice also compromises secondary GM buyers, too. There may be some or almost none of the original warranty that the first buyer got. Look, as great as these GM products are, we all want them to cover unexpected issues that may crop up.
GM also suggests that “this will help prioritize ownership by our top brand enthusiasts and most loyal customers. We are at a loss to explain what, exactly, this really means. But mulling it over, we think it means protecting an image that GM wants to convey to monied buyers in the league of Ferrari and other exotics. Or, not.
Who buys these popular GM vehicles?
What’s happening is that, in general, funded groups buy allocations of these low-volume, high-demand vehicles. Then they sell them on the secondary market for big profits. Will this happen with Z06 purchases? It depends on whether the restrictions imposed on warranties sway potential buyers.
The GMC Hummer and Z06 Corvette are seeing strong demand and limited production. So if GM really wants to throttle secondary sales, it should just crank out more production of any vehicles it thinks might fall into the situation. It’s basic Business 101, always about supply and demand.