View Full Version : Osd - what's in it for volvo?

01-31-2003, 01:29 PM
Simple question: how can (a) the manufacturer and (b) the dealer offer such compelling incentives on OSD cars? Obviously they both save on inventory costs, but is there any other reason? Is there some sort of import tariff that is bypassed when they ship the car on behalf of a private individual? Anyone have any insight into the dealer's margin on an OSD vehicle as opposed to buying one off the lot?



01-31-2003, 01:57 PM
My understanding is that the sales person makes maybe a few $100 and the dealership maybe some more plus selling more volume and getting discounts etc from Volvo.

There must or maybe something in the import duty regulations/tax-rules related to OSD vs. normal and this may be associated with the OSD vehicle being a USED vehicle. Maybe a USED vehicle carries less import duty tax burden vs. a NEW vehicle. The savings can thus be passed onto you and me http://xc70.com/iB_html/non-cgi/emoticons/biggrin.gif

It may also be tied up with quotas limits.

The cost of money may also be a factor -- Volvo gets their money before the car leaves their factory. Maybe Swedish Govt. offer tax breaks to Volvo for doing OSD as it brings people into Sweden who spend some money on hotels and food etc. That is, it promotes tourism.

01-31-2003, 03:08 PM
Here a quote from an OSD saleperson in NC about the cost savings in buying your vehicle through the OSD program....
</span><table border="0" align="center" width="95%" cellpadding="3" cellspacing="1"><tr><td>Quote </td></tr><tr><td id="QUOTE">
Again I will bring up the point I&#39;ve presented on http://www.vvspy.com a number of times: The duties and custom&#39;s charges are the same on a dealer car and a TDS (now OSD) vehicle. Volvo has built them into the selling base price. Where you are saving is by bypassing the usual markup from VCNA. That&#39;s why you can&#39;t use any of the normal incentives, finacing programs, or special lease rates on an overseas delivery.

If I can help with a OSD order, please let me know. Most http://www.vvspy.com people know me from here.

Steve [email protected] [/QUOTE]<span id='postcolor'>

Low Tide
01-31-2003, 04:29 PM

From what I know- you are pretty close to the ball with your post. The major factors that shape OSD are indeed:

1) No VCNA markup for NA sales efforts
2) Volvo to Dealer incentives/discounts/payments/volume
3) Swedish export incentives to Volvo for volume
4) Profitability for Volvo to sell direct v. dealer buy
5) Customer goodwill/repeat business is very high for OSD cus.
6) Publicity + subsidy for parts of program costs from S. govt

It is really an amazing history of a program as well. Very close family friends have purchased Volvo&#39;s since the 60&#39;s this way, although the program has changed quite a lot from what I hear.

You&#39;ll certainly notice that Volvo repeat buyers get additional incentives as well--

Oh, and BTW: &nbsp;congrat on the order Automonkey&#33; &nbsp;Now your a March OSD groupie too... http://xc70.com/iB_html/non-cgi/emoticons/hehe.gif

Joy Driver
01-31-2003, 05:38 PM
This OSD program sounds very appealing to me in the future. &nbsp;i haven&#39;t done the sums, to figure out whether it is most economical to purchase a vehicle out right, then sell or trade in, or to keep a vehicle long term, pay for repairs and then in the end get a lower price for the sale/trade in of it. &nbsp;I have never leased or taken a loan on a vehicle before. &nbsp;
Now to my question, should I choose to do an OSD in 4 years+, will the dealership take my current 2002 as a trade in and give me the tax savings?

01-31-2003, 05:57 PM
Joy Driver said:

</span><table border="0" align="center" width="95%" cellpadding="3" cellspacing="1"><tr><td>Quote </td></tr><tr><td id="QUOTE">Now to my question, should I choose to do an OSD in 4 years+,...[/QUOTE]<span id='postcolor'>

YES, if you wish to save money vs, normal off-the-lot purchase.

</span><table border="0" align="center" width="95%" cellpadding="3" cellspacing="1"><tr><td>Quote </td></tr><tr><td id="QUOTE"> ...will the dealership take my current 2002 as a trade in and give me the tax savings?[/QUOTE]<span id='postcolor'>

You can negotiate your current 2002 tradin value at time you purchase in 4+ years. The OSD purchase is just like a normal purchase except you get fixed base price and some free goodies thrown in such a free SAS round trip to Goteborg.

02-06-2003, 06:09 AM
check with you local dealer/salesperson, but i believe that will tell you that volvo has recently increased the &#036; they get for an osd - significantly&#33; &nbsp;like 10 times or so? &nbsp;anyway, i think this is good news for almost everyone. &nbsp;it seems to indicate that dealers will be more receptive to osd orders because they will make more money, fdc will be happy to see increase in osd orders, osders will be happy that their dealers make more on the deal, &nbsp;but VCNA will probably be unhappy?

02-06-2003, 09:38 AM
</span><table border="0" align="center" width="95%" cellpadding="3" cellspacing="1"><tr><td>Quote </td></tr><tr><td id="QUOTE">
it seems to indicate that dealers will be more receptive to osd orders because they will make more money, fdc will be happy to see increase in osd orders, osders will be happy that their dealers make more on the deal, but VCNA will probably be unhappy?[/QUOTE]<span id='postcolor'>

rkestner, this is exactly what I couldn&#39;t figure out - someone had to be losing out on the deal, and it seems that the consensus is that it&#39;s VCNA. Unless you need a car in a hurry or are afraid of flying/leaving the country, there seems to be little incentive for the consumer to buy off the dealer&#39;s lot and a whole lot of incentive to pick up the car in Sweden.

Low Tide
02-06-2003, 09:57 AM
Right on Automonkey.... that&#39;s my thought exactly. &nbsp;Crazy to think about it still. &nbsp;One thing that precludes a lot of OSD/TDS buyers is that &quot;impulse&quot; thing that we Americans are so proficient at mastering. &nbsp;Don&#39;t you think? &nbsp;You mean I have to WAIT for it to be built... and I have to wait for it again to arrive? &nbsp;Can&#39;t the boat go any FASTER&#33; &nbsp;Somebody is laughing somewhere about it..... I know they are.

02-06-2003, 07:32 PM
i believe the key to the whole thing is that volvo only makes cars when they are ordered. &nbsp;at least this is what they told me during the factory tour. &nbsp;i asked twice to make sure i heard them correctly. &nbsp;my deductive reasoning inabilities tell me that this means that vcna orders and pays for cars in advance (or on credit) for all the dealers in north america. &nbsp;consequently, they have to pass along their costs. &nbsp;when you buy directly from volvo, that is place an order and pay for the car, the only difference has to be the vcna costs. &nbsp;of course, during the model year production runs there have to be a number of cars ordered and deposit paid, but then not followed through with because of death, bankruptcy, divorce, being elected to public office, (insert your own reason here.....). &nbsp;this is the reason there are some cars in the sep-oct timeframe pre-built and available at savings through osd. &nbsp;in fact, i believe i saw 100-150 cars at torslanda in september that were in this category when i just rode around on the volvo workers shuttle bus. &nbsp;anyway, it might help to explain why the fdc is pretty agreeable and helpful (good motivation &amp; profit motive) versus the (uh oh, have to be tactful here&#33http://xc70.com/iB_html/non-cgi/emoticons/wink.gif ummm.....well.......anyway, the vcna helpfulness, timeliness, etc. &nbsp;i did not have any direct dealings with the vcna folks during my transaction back in august of last year except with the wonderful, friendly, women at the us 1-800 number. &nbsp;whatdoyathink???