We were working with a client the other day who felt they suffer from "The Mercedes Effect".  This tied not just to their given brand but a concept that I wonder if it affects many higher-end dealerships.  Just because the average sale price of a unit is 2-3 times that of other brands, does that really mean that the dealership should pay a premium on many of their purchases?  Granted the purchase prices are higher but the volume is lower, and the margins don't always support this premium..

Do you all think this is real?  What are your experiences?  I am curious as to if dealers of higher-end vehicles feel that they are subject to higher prices on the exact items/services that their peers in the non-luxury brands pay?  (Granted - some of the items are NOT the same - but many are!)

Thoughts?