Ford and Dealership Pricing

[xr7g428]

struggle here...like a bloody ghost-town...actually got offered a job at a Benz dealer last week...hmmmmmm, bills to pay DAMMIT!

 

Well Deanh, all of that ill will generated by ADM tends to build up over time. Customers don't have lots of experience with your store, they have one experience. If they have walked out thinking you guys are a rip off, what is going to change that opinion? And how many people are they going to tell about your ADM price gouging?

 

What if you had used the cars as incentives? What if you had given everybody that test drove a Mustang a shot at a GT500 at BELOW sticker? Imagine, you could have built some real traffic, Right next to the GT500 you could have parked a GT with the Ford Blower for thousands less. Maybe people who drove a GT would find out it really is more fun to drive than the GT500? You could have put up a little display with the steering wheel and shift boot out of the Shelby, along with a Shelby stripe kit, as a mini Shelby upgrade? Want me to go on?

 

But the answer is no. It's more fun to tear the one guys head off and take home the big check than it is to sell a bunch of cars. You guys developed a department of crushed dreams, humiliated your customers, and giggled about how stupid they were for even thinking that they could buy a car from you. So now you are surprised when they don't grace your door? Newsflash, they want to see you suffer.

 

Before you tell me that I am a whiner who couldn't afford the GT500, remember than my two daily drivers are a BMW M5 and a Saleen S281SC, . My bitch is not that Shelby's sell for a lot of money, only that Ford bungled the pricing so bad, left so much money on the table, that the dealers were able to make such fools of themselves. If Ford had gotten either the price, or the build quantity right, this thread would not exist.

[Keyser Soze]

Well Deanh, all of that ill will generated by ADM tends to build up over time. Customers don't have lots of experience with your store, they have one experience. If they have walked out thinking you guys are a rip off, what is going to change that opinion? And how many people are they going to tell about your ADM price gouging?

 

I doubt that very many customers at an average Ford store would ever even know about this situation. How many serious buyers are there for this car anyway? Why would I care if the dealer marks up a car I have no intention of buying?

 

Toyota dealers put big time markups on the last of the turbo Supras and that doesn't seem to have cooled off Camry and Corolla sales any. The early S2000's had AMV stickers and yet Accords and Civics still sell strongly. Chevy dealers have done it for years with Corvettes like the ZR-1 and the Z06. Didn't affect my decision to get a Trailblazer in'03. The "new" Beetle went for thousands over list when it first arrived. Even the lowly PT Cruiser was marked up over list in the beginning.

 

I see this situation in a completely different light. Every fool who forks over thousands above list for some toy is helping to subsidize my next car purchase. If the dealer can get a little fat on specialty cars, he can afford to let whatever "normal" car I'm interested in go a little cheaper. Simple math.

 

I think some of you guys are blowing this out of proportion. Dealers cost themselves (and the manufacturer) a lot more business in the service department that they ever will with additional markup. I've never had a single person tell me to steer clear of a particular dealership because some new, limited model had a supplemental sticker on it. I can't remember how many have cursed a blue streak when they felt they got screwed during a repair.

[ford4v429]

I think some of you guys are blowing this out of proportion. Dealers cost themselves (and the manufacturer) a lot more business in the service department that they ever will with additional markup. I've never had a single person tell me to steer clear of a particular dealership because some new, limited model had a supplemental sticker on it. I can't remember how many have cursed a blue streak when they felt they got screwed during a repair.

 

I've blown this out of proportion in my mind maybe, but the dealer who proudly had a $100,000 'market adjustment' on their GT(40) -that I would never afford anyway- will never sell me a car, as in my mind I know they are out to bend over anyone they can as hard as possible...I *might* use their service in an emergency/on a trial basis only, but they couldnt give me a car- ever...and thats a long time.

 

there are dealers that I'd buy from who I would never let touch my car in service...my mustang is an example- very bad experience after brake service on our windstar(lost brakes 3 days after new linings/inspect/adjust...ONLY time in my life Ive let anyone work on my brakes, paid 200 bucks for linings/clean/adjust...well they missed the stuck wheel cylinder in the rear which overheated bad enough to boil the fluid apparently- lost brakes 1/2 hour into a highway vacation trip...pulled off, went to check fluid and blew brake fluid all over when I loosened the cap...I was as hot as the rear wheel that day, they never touched the car again- just went out of business recently, in my opinion probably in part due to similar service end things, as sales folks were great... even after that 'service', I ordered my Mustang thru them...

 

accidents happen/mistakes occur, thats still justification to shop around for service in my opinion- but ADM is not accidental and in my opinion just shows what the dealer is about- blatently get every penny possible in any 'justifiable' way possible...thats not an accident and its not the kind of store I'll stop at again.

 

On 9/11 all but one gas station in town jacked up their prices- guess where I bought my gas the last 7 years...and Ive told lots of folks WHY. maybe I'm reading too much into what I see as folks getting screwed over 'just because they can', but thats just me...maybe some bizzilionaire will smile getting screwed while 'cutting in line' for the latest gadget by being 'high bidder', but I think for every one of them, there will be 100 bread and butter shoppers saying 'stay away'...and doing just that. Might not affect overall/fleetwide sales by enough to bat an eye at, but in this day and age, one lost would-be ADM refusing shelby buyer will be most likely be a ''I aint buying a f150 from them' / 'tell mom to go elsewhere' type in the future, and most dealers are not looking at long term repercussions of gouging...again, thats just my opinion

 

My biggest beef is that Ford is not allowed to ADM the dealers(what happened to the 'free market/economics 101' stuff the dealers say when someone cries foul?) on a product thats aparently 'worth' more than its current price...if Ford did that- well heck, they engineered/tested/manufactured/warranted the thing, why shouldnt they get a bonus for all their hard work in producing an out of the ballpark homerun product? because Dealers shuffle some paperwork they 'deserve' 10 times the profit of Ford/Shelby??? I cant help but feel bad for Ford/ashamed for dealers in that regard.

 

Ford requires dealers to accept so many cars a month, if they dont sell the dealer has to undercut to move them, so maybe in the end ADM is still less than a wash fairnesswise to the dealer, but it just dont sit right with me for some reason. the whole dealer/allocation/process is screwed up mostly because the car companies all seem content competing with honda rather than making cars like the gt/mustang gt/shelby that folks will actually stand in line for...probably makes perfect sense to accounting gurus somewhere, but for the life of me i cant see why they dont put a 56 F100 paneltruck body on the ranger in 2+2 fashion to send demand thru the roof on a 'paid for' and tried/true platform... maybe if all the looser models were desirable/affordable, the ADM would just go away- but indications say otherwise...if every car ford made was in as high demand as Shelby's, the ADM would make for a lot of rich dealers, yet Ford could still go bankrupt as their profit for their work would never rival profits of Shelby sellers...

[partsisparts]

Well Deanh, all of that ill will generated by ADM tends to build up over time. Customers don't have lots of experience with your store, they have one experience. If they have walked out thinking you guys are a rip off, what is going to change that opinion? And how many people are they going to tell about your ADM price gouging?

 

What if you had used the cars as incentives? What if you had given everybody that test drove a Mustang a shot at a GT500 at BELOW sticker? Imagine, you could have built some real traffic, Right next to the GT500 you could have parked a GT with the Ford Blower for thousands less. Maybe people who drove a GT would find out it really is more fun to drive than the GT500? You could have put up a little display with the steering wheel and shift boot out of the Shelby, along with a Shelby stripe kit, as a mini Shelby upgrade? Want me to go on?

 

But the answer is no. It's more fun to tear the one guys head off and take home the big check than it is to sell a bunch of cars. You guys developed a department of crushed dreams, humiliated your customers, and giggled about how stupid they were for even thinking that they could buy a car from you. So now you are surprised when they don't grace your door? Newsflash, they want to see you suffer.

 

Before you tell me that I am a whiner who couldn't afford the GT500, remember than my two daily drivers are a BMW M5 and a Saleen S281SC, . My bitch is not that Shelby's sell for a lot of money, only that Ford bungled the pricing so bad, left so much money on the table, that the dealers were able to make such fools of themselves. If Ford had gotten either the price, or the build quantity right, this thread would not exist.

 

The only solution to the problem is for everybody to pay list price. XR7 have you gone into a dealer damanding a discount?? It works both ways.

Edited June 23, 2007 by partsisparts

[xr7g428]

The only solution to the problem is for everybody to pay list price. XR7 have you gone into a dealer damanding a discount?? It works both ways.

 

You present this is if these were the only two alternatives, and that given these two we should pick the least objectionable, which I presume you feel must be the current situation. There are many more alternatives, but you have missed my point entirely. Ford under priced the Shelby dramatically.

 

Perhaps the Ford strategy was to intentionally under price the vehicle to allow it to carry on the "Mustang equals good value" premise. If that is the case, then the unintended consequence is that the 50,000 customers that could have purchased the car at MSRP, became the 7000 that paid much more and the 43,000 who think Ford dealers engage in bait and switch tactics.

 

Perhaps Chevy, and Honda dealers can afford to alienate customers, right now, Ford can't. Ford must make conquest sales in the passenger car market. There are no throw away customers in a Ford store.

 

The worst part of this is that the customers that lined up for this car, are enthusiasts. These are the guys at the office that everybody goes to to find out what is hot and where to buy. In marketing they are called "smart friends". You may be a car expert yourself, but who would you talk to before you bought a big plasma TV? Probably that guy at the office that knows everything about electronics... His opinion of the retailers is not going to be formed based on how they treat every body, it is going to be based on how they treated him when he had to have the new Sony SXRD HDTV that nobody had in stock. And his recommendation of Sony isn't going to be based on the bottom of the line product.

 

The issue in automotive retail is that customers and dealers have to agree on 4 things: price, payment, interest rate, and trade in. Since these all are interrelated, negotiation is required to see just how much value to put into each bucket. Simply fixing one variable (MSRP), still leaves the others to be negotiated. Maybe if the sales team spent a little more time building need, use, and value, they could spend a little less time haggling over the last dollar.

[partsisparts]

You present this is if these were the only two alternatives, and that given these two we should pick the least objectionable, which I presume you feel must be the current situation. There are many more alternatives, but you have missed my point entirely. Ford under priced the Shelby dramatically.

 

Perhaps the Ford strategy was to intentionally under price the vehicle to allow it to carry on the "Mustang equals good value" premise. If that is the case, then the unintended consequence is that the 50,000 customers that could have purchased the car at MSRP, became the 7000 that paid much more and the 43,000 who think Ford dealers engage in bait and switch tactics.

 

Perhaps Chevy, and Honda dealers can afford to alienate customers, right now, Ford can't. Ford must make conquest sales in the passenger car market. There are no throw away customers in a Ford store.

 

The worst part of this is that the customers that lined up for this car, are enthusiasts. These are the guys at the office that everybody goes to to find out what is hot and where to buy. In marketing they are called "smart friends". You may be a car expert yourself, but who would you talk to before you bought a big plasma TV? Probably that guy at the office that knows everything about electronics... His opinion of the retailers is not going to be formed based on how they treat every body, it is going to be based on how they treated him when he had to have the new Sony SXRD HDTV that nobody had in stock. And his recommendation of Sony isn't going to be based on the bottom of the line product.

 

The issue in automotive retail is that customers and dealers have to agree on 4 things: price, payment, interest rate, and trade in. Since these all are interrelated, negotiation is required to see just how much value to put into each bucket. Simply fixing one variable (MSRP), still leaves the others to be negotiated. Maybe if the sales team spent a little more time building need, use, and value, they could spend a little less time haggling over the last dollar.

 

Ford never intended to build 50 thousand Shelbys. They priced the car where they thought it should be. Demand was high and the prices went up. What happened was the traditional Mustang buyer was turned away by the high prices. The car was sold to a lot of people who would have never entered a Ford store except for a vehicle like the Shelby. People with a lot of money looking for a high performance car.Similar to the situation with the Ford GT. I believe this is exactly what ford intended to happen.

Ford did not need for the tradition al Ford buyer to buy that car, they are already loyal customers. They were trying to bring new customers into a ford dealer.

Edited June 24, 2007 by partsisparts

[ford4v429]

Ford did not need for the tradition al Ford buyer to buy that car, they are already loyal customers. They were trying to bring new customers into a ford dealer.

 

maybe, but read around ANY of the myriad Mustang enthusiast internet forums- theres a lot of pissed off 'loyal customers', and although dealers are responsible, Ford gets most of the black eye and none of the profit from the ADM. The dealer practice of 'market adjustment' is one of the more controversial topics on almost all forums...Ford did the right thing by making an affordable flagship(GT vs pick your Italian supercar) for folks that might have never been in the supercar market- and they did the right thing by making the ultimate mustang hotrod affordable by anyone that could buy a loaded SUV...but dealers pretty much pissed all those folks away.

 

I do feel for dealers that often have to cut percentages to move cars, but tacking on 1000% more profit than even a full msrp deal to 'make up for the others' dont sit well with most folks...at least folks that might have actually thought about buying the product. those that wouldnt buy the product to begin with, or dealer personnel are probably 90% of the justifying voice out there, the other 10% being folks that had the cash to hand 25k to a dealer on top of their full msrp profit for handling the paperwork, as wa way to say "no I didnt get screwed, im happy with my price" type of thing. More power too them, but IF one of their buddies ever picks up a Shelby at sticker, how is that guy gonna feel about his dealer???

 

if ADM was split with Ford, I wouldnt mind- but rewarding those that have absolutely ZERO invested in putting the product together tenfold more than the folks that put the blood/sweat/tears into designing/manufacturing it??? no freakin way.

if wallmark wants to sell shoes from singapore that they paid 25 cents for at retail for 50 cents no one would complain- when they see 50 bucks as 'justified due to market value' thats when folks get fed up and start complaining.

 

I gotta agree 100% with xr7g428's quote above about the 7000/43000 type of effect dealers are having across the country because of this.

Edited June 24, 2007 by ford4v429

[Maximus]

I won't profess to know basically anything about how the legal or working relationship works between Ford and dealers but it is pretty mindboggling to think that you have no or limited ability to dictate terms to the people you're allowing to sell your products...as most on here would agree, most people if they get shitty service or whatever on the front lines then proceed to blame the producer, not the jackass that sold them it...and it may come as maybe most people don't realize that Ford has little no control over their actions...just seems funny to me that if I'm Ford and my business may suffer from someone treating people that want to buy my vehicles like shit and I can't do much of anything about it, something just doesn't seem right

[akirby]

I won't profess to know basically anything about how the legal or working relationship works between Ford and dealers but it is pretty mindboggling to think that you have no or limited ability to dictate terms to the people you're allowing to sell your products...as most on here would agree, most people if they get shitty service or whatever on the front lines then proceed to blame the producer, not the jackass that sold them it...and it may come as maybe most people don't realize that Ford has little no control over their actions...just seems funny to me that if I'm Ford and my business may suffer from someone treating people that want to buy my vehicles like shit and I can't do much of anything about it, something just doesn't seem right

 

No, it's not right but that's reality. Back in the 50's or 60's the auto dealers convinced their state legislators to pass laws that protected them from the big, bad auto mfrs. These laws prevent the mfrs from selling vehicles directly to the public and prevent the mfrs from controlling what the dealers charge or what vehicles they sell. Ford tried a variation where they advertised used cars on the internet and then arranged test drives and sales through a local dealer. Dealers sued and won. Ford tried to offer a financial incentive to dealers who were Blue Oval Certified (or more accurately a penalty for those who weren't). Dealers sued again and won.

 

I asked the Lincoln VP of Marketing why Lincoln didn't require it's dealers to stock at least one manual transmission LS for test drives. He said if he tried to do that he'd end up in jail.

 

Not sure how to fix it short of changing the laws which probably won't happen. Auto dealers have a lot of influence at the state capitals.

[Deanh]

Well Deanh, all of that ill will generated by ADM tends to build up over time. Customers don't have lots of experience with your store, they have one experience. If they have walked out thinking you guys are a rip off, what is going to change that opinion? And how many people are they going to tell about your ADM price gouging?

 

What if you had used the cars as incentives? What if you had given everybody that test drove a Mustang a shot at a GT500 at BELOW sticker? Imagine, you could have built some real traffic, Right next to the GT500 you could have parked a GT with the Ford Blower for thousands less. Maybe people who drove a GT would find out it really is more fun to drive than the GT500? You could have put up a little display with the steering wheel and shift boot out of the Shelby, along with a Shelby stripe kit, as a mini Shelby upgrade? Want me to go on?

 

But the answer is no. It's more fun to tear the one guys head off and take home the big check than it is to sell a bunch of cars. You guys developed a department of crushed dreams, humiliated your customers, and giggled about how stupid they were for even thinking that they could buy a car from you. So now you are surprised when they don't grace your door? Newsflash, they want to see you suffer.

 

Before you tell me that I am a whiner who couldn't afford the GT500, remember than my two daily drivers are a BMW M5 and a Saleen S281SC, . My bitch is not that Shelby's sell for a lot of money, only that Ford bungled the pricing so bad, left so much money on the table, that the dealers were able to make such fools of themselves. If Ford had gotten either the price, or the build quantity right, this thread would not exist.

XR...that is the most bone headed retort I have read on ANY of these threads...if you think 1 car is responsible for how slow the business is you need to get your thumb outa your mouth and leave the sandpit. Addendums are accepted by people with half a brain...regardless of manufacture, they DO not, I repeat DO NOT lose us sales...the people that are piseed were not going to buy the car in the first place FULL STOP! Terms such as RIPPING ONE HEADS OFF are so prehistoric as to be humourous and obviously unbeknownst to yourself...those bottom of the barrell sales people are on set commissions on the Shelbys ( 1500 here ) wow!!!!!!!, and as for the statement of US developing it...yeah...we all sat around a damn table and came up with a similar concept to the housing market and what the market can bear/ supply and demand...come on man...it exhists in ANY market...check your gas prices....but hey you may have hit the nail on the head...NOBODY is buying anything because Ford dealers added markup to a limited production halo car....ripple effect is amazing, must be why my buddys Bimmers aren;t selling either...damn that shelby..ADMs are a way of life...they are NOT going away...I don't particularly agree with them but understand them...I got over it, life goes on...perhaps you should do the same...........

Edited June 25, 2007 by Deanh

[Deanh]

I doubt that very many customers at an average Ford store would ever even know about this situation. How many serious buyers are there for this car anyway? Why would I care if the dealer marks up a car I have no intention of buying?

 

Toyota dealers put big time markups on the last of the turbo Supras and that doesn't seem to have cooled off Camry and Corolla sales any. The early S2000's had AMV stickers and yet Accords and Civics still sell strongly. Chevy dealers have done it for years with Corvettes like the ZR-1 and the Z06. Didn't affect my decision to get a Trailblazer in'03. The "new" Beetle went for thousands over list when it first arrived. Even the lowly PT Cruiser was marked up over list in the beginning.

 

I see this situation in a completely different light. Every fool who forks over thousands above list for some toy is helping to subsidize my next car purchase. If the dealer can get a little fat on specialty cars, he can afford to let whatever "normal" car I'm interested in go a little cheaper. Simple math.

 

I think some of you guys are blowing this out of proportion. Dealers cost themselves (and the manufacturer) a lot more business in the service department that they ever will with additional markup. I've never had a single person tell me to steer clear of a particular dealership because some new, limited model had a supplemental sticker on it. I can't remember how many have cursed a blue streak when they felt they got screwed during a repair.

thx Kaiser...nice to see some common sense...and YES...service costs us a LOT more sales than a marked up ego boost on the showroom.......

[xr7g428]

Addendums are accepted by people with half a brain...

 

Yes, and I can see that you clearly qualify here.

 

 

So lets get this straight.

 

In your opinion:

 

It is preferable for Ford to price the car below market, and then for dealers to add a large ADM?

 

There is no better way to use halo vehicles to grow the business.

 

Does that sum it up?

[Deanh]

Yes, and I can see that you clearly qualify here.

So lets get this straight.

 

In your opinion:

 

It is preferable for Ford to price the car below market, and then for dealers to add a large ADM?

 

There is no better way to use halo vehicles to grow the business.

 

Does that sum it up?

niiiiiiice... I'm not the one with the one sided objective here, by half the brain I mean people with the need to massage their ego...because pretty much that is what halo cars are, vehicles for those with the need for a massage with dispensable income....and NO I don't think its cool for Ford underpricing..all i have EVER said is NOT to blame the dealers for doing what they do because of THAT reason...please read some of the my other posts...AGAIN! Lets face it...in reality the Shelbys etc usually bring in people that never would have thought of buying a Ford ( witness the GT40 )...they are basically drawcards.....and if you think THAT is what our business or lack of is due to you need to come in for a couple of months and experience first hand....I have you here as I see BOTH sides.... NOT just my own thru rose coloured glasses........Halo cars are NOT made to grow business...if they were they would build a bunch more and then they are no-longer a halo or limited production ego massaging must have are they? last i looked m5's weren't mass produced either...although in comparison I would guess they build a LOT more than the GT500's...PS..side thought...I GUARANTEE 75% of the GT500 whiners couldn't or wouldn'y have bought the car regardless.....just human nature...something to moan about....

[partsisparts]

niiiiiiice... I'm not the one with the one sided objective here, by half the brain I mean people with the need to massage their ego...because pretty much that is what halo cars are, vehicles for those with the need for a massage with dispensable income....and NO I don't think its cool for Ford underpricing..all i have EVER said is NOT to blame the dealers for doing what they do because of THAT reason...please read some of the my other posts...AGAIN! Lets face it...in reality the Shelbys etc usually bring in people that never would have thought of buying a Ford ( witness the GT40 )...they are basically drawcards.....and if you think THAT is what our business or lack of is due to you need to come in for a couple of months and experience first hand....I have you here as I see BOTH sides.... NOT just my own thru rose coloured glasses........Halo cars are NOT made to grow business...if they were they would build a bunch more and then they are no-longer a halo or limited production ego massaging must have are they? last i looked m5's weren't mass produced either...although in comparison I would guess they build a LOT more than the GT500's...PS..side thought...I GUARANTEE 75% of the GT500 whiners couldn't or wouldn'y have bought the car regardless.....just human nature...something to moan about....

 

 

Dean,

Don't get into a pissing match with a person who knows nothing about the car business. You have been a salesman along time, you know better!

 

ADMs on a car you cannot get is like when goods first come out. Remember when RAZOR scooters came out a few years ago? They were $200 plus. Now you can buy one for $20. Supply and demand. The price is whatever the market will bear.

 

IT IS NOT THE DEAL YOU GET, BUT THE DEAL YOU THINK YOU GET. Obviously a lot of people think the Shelby is a great deal at 60K. Nobody is forcing them to buy it!!!!!!!!!!

[Deanh]

Dean,

Don't get into a pissing match with a person who knows nothing about the car business. You have been a salesman along time, you know better!

 

ADMs on a car you cannot get is like when goods first come out. Remember when RAZOR scooters came out a few years ago? They were $200 plus. Now you can buy one for $20. Supply and demand. The price is whatever the market will bear.

 

IT IS NOT THE DEAL YOU GET, BUT THE DEAL YOU THINK YOU GET. Obviously a lot of people think the Shelby is a great deal at 60K. Nobody is forcing them to buy it!!!!!!!!!!

The horse is dead...just took umbrage to the incinuated cause of the business right now being semi blamed on ADM's...I guess i need to talk to my dealer principal and tell him we don't want any more Shelby's because they are hurting our business..........one sided pot shots annoy me...some of the guys should come and sell for a while and get a different perspective...and ...ONCE AGAIN.....i don't agree with ADM's either...i just understand them and realise all the vocalities are not going to change the situation...so...move on...

[Deanh]

what is ironic is I would LOVE to see the actions of some of the posters if they were selling their house or even used car...... and NOT taking the best offer....amazing what $$$$ do to people when the shoe is on the other foot...I'm sorry sir but your offer is tooo high, I would not wish to be veiwed as a hypocrite ....

[xr7g428]

My only interest in this is that Ford might sell more cars. It should be clear by now that doing the same things and hoping for different results is still crazy.

 

Some where in there I think you answered the questions: (Ford should underprice and let dealers ADM)

 

and NO I don't think its cool for Ford underpricing..

 

And then then we got a little crossed up on question number 2: (How to use halo cars to build the business)

 

Shelbys etc usually bring in people that never would have thought of buying a Ford ( witness the GT40 )...they are basically drawcards.

 

Halo cars are NOT made to grow business...if they were they would build a bunch more and then they are no-longer a halo or limited production ego massaging must have are they?

 

I GUARANTEE 75% of the GT500 whiners couldn't or wouldn'y have bought the car regardless.

 

I think we agree about draw cards. These halo cars are intended to bring new customers into the store. They are also intended to shift the perception of just what a Ford is in the minds of consumers. As you say, they take people from "I'd never buy a Ford" to "I'd buy a Ford like that". And they also reinforce the pride that loyal Ford owners have in the brand. Owning any Mustang just became a little more cool when they Shelby hit the street.

 

I have to admit, you got me with the "not made to grow the business" part. Frankly, I think that Ford needs a high margin car that sells in large quantities with no discounts, but call me silly...

 

The gold mine is located in your last statement. I think you are right: 3 out of 4 of the customers left pissed. But that could never have an impact on business today... It is not the only factor, it is just one more...

 

Instead of telling the principal that you don't want to see a GT500KR on the floor, why don't you try to think of some creative ways to use the car to get people to come in and look at it, drive a regular Mustang GT, and show them how easy it would be to add a little Shelby flavor for a fraction of the money. Maybe they will drag in a friend that might see a new Taurus, and realize they they could put two or three bodies in the trunk, and still have room for a couple of bags of cement. Just don't put the ADM sticker on the car.

 

And partsisparts, step up your game. Read the first post. This is not about the price. Everyone agrees that the cars are rare and should be expensive. In the marketing equation there are four basic tools: product, promotion, distribution, and price. It looks like Ford got the product right, the promotion right, the distribution is questionable, but not a consumer hot button, pricing, has been a disaster. One view is that the current drill is fine, and it's the customers who are to blame for not embracing ADM as a way to allocate the cars. The customer view appears to be that ADM, however justified, feels dirty. Further, they seem to think that Ford should be able to do something about it, and blame Ford for allowing this situation to exist.

 

Deanh does an excellent job of bringing the dealer viewpoint to the table, complete, and unvarnished. It is important to get every perspective to the table. He threw out that half a brain thing... I just couldn't resist LOL!

[Deanh]

My only interest in this is that Ford might sell more cars. It should be clear by now that doing the same things and hoping for different results is still crazy.

 

Some where in there I think you answered the questions: (Ford should underprice and let dealers ADM)

And then then we got a little crossed up on question number 2: (How to use halo cars to build the business)

I think we agree about draw cards. These halo cars are intended to bring new customers into the store. They are also intended to shift the perception of just what a Ford is in the minds of consumers. As you say, they take people from "I'd never buy a Ford" to "I'd buy a Ford like that". And they also reinforce the pride that loyal Ford owners have in the brand. Owning any Mustang just became a little more cool when they Shelby hit the street.

 

I have to admit, you got me with the "not made to grow the business" part. Frankly, I think that Ford needs a high margin car that sells in large quantities with no discounts, but call me silly...

 

The gold mine is located in your last statement. I think you are right: 3 out of 4 of the customers left pissed. But that could never have an impact on business today... It is not the only factor, it is just one more...

 

Instead of telling the principal that you don't want to see a GT500KR on the floor, why don't you try to think of some creative ways to use the car to get people to come in and look at it, drive a regular Mustang GT, and show them how easy it would be to add a little Shelby flavor for a fraction of the money. Maybe they will drag in a friend that might see a new Taurus, and realize they they could put two or three bodies in the trunk, and still have room for a couple of bags of cement. Just don't put the ADM sticker on the car.

 

And partsisparts, step up your game. Read the first post. This is not about the price. Everyone agrees that the cars are rare and should be expensive. In the marketing equation there are four basic tools: product, promotion, distribution, and price. It looks like Ford got the product right, the promotion right, the distribution is questionable, but not a consumer hot button, pricing, has been a disaster. One view is that the current drill is fine, and it's the customers who are to blame for not embracing ADM as a way to allocate the cars. The customer view appears to be that ADM, however justified, feels dirty. Further, they seem to think that Ford should be able to do something about it, and blame Ford for allowing this situation to exist.

 

Deanh does an excellent job of bringing the dealer viewpoint to the table, complete, and unvarnished. It is important to get every perspective to the table. He threw out that half a brain thing... I just couldn't resist LOL!

one thing i think no-one has taken into consideration is that perhaps the intensity of construction of the blown engine may mandate the fact that they can only produce so many...i am guessing ( and please correct me if i am wrong ) they are pretty much hand built????? And XR...one can VERY easily step up the performance of a regular GT...but warranties are voided. That said the Shelby does bring in regular GT buyers....what I think ford should do is offer dealer installed hop up packages that don't void warranties....kinda like we can do with shelbys right now ( although here too warranties are voide ) 27,000 bux and you can ship a Shelby back To carrols shop and it returns as a super snake...725 HP!!!!!!!!!!!! 27000 bux and you too can have a small pen....LOL! oh...and I don't think you will EVER see an ADM on a Taurus.... pps....I honestly think that people that can truley buy or afford a limited production vehicle of ANY manufacturer is quite aware of the fact that they will most likely pay over window...I haven't heard ONE complaint from ANY of the people that actually bought........

Edited June 25, 2007 by Deanh

[xr7g428]

And XR...one can VERY easily step up the performance of a regular GT...but warranties are voided. That said the Shelby does bring in regular GT buyers....what I think ford should do is offer dealer installed hop up packages that don't void warranties....

 

Deanh, i might actually be able to help you make some money...

 

As it turns out Ford does have exactly what you are asking for: Kits that don't void the warranty, and even come with a nice extra. When installed at the time of purchase, they have a 3 year 36,000 mile warranty. Installed after purchase, the warranty is only 12 months.

 

Ford Racing Performance Power Pack Kits

 

You can also get all of the interior pieces right out of your very own parts department, and none of those appearance items are going to void the warranty.

 

Focus on what you can do for the customer (Shelby performance), instead of what you can't (cheap Shelby).

[goinbroke2]

So, to sum up the thread, $60,000 is fine for a car if it's msrp is $60,000, but it's a rip off if the same car is $60,000 and the msrp is $40,000.

 

mkay....

 

To solve this "incredible" problem, ford should up the msrp to $60,000 (for example). What happens in a few months when the charm wears off and a shelby goes for only $40,000 because that's all it's worth?

 

Everybody is up in arms because the vaunted shelby has lost it's appeal and now can only fetch 2/3 asking price. Suddenly, nobody wants a shelby because (obviously) they can't sell them and are dropping the prices to move them. $20,000 rebate to buy a specialty car!! And you guys yell about $6,000 on a tundra, can you imagine the uproar over dropping the price of a shelby??

 

It is favorable to the manufacture, owner, enthusiest if a car is kept exclusive. Part of that is done buy limited numbers, sometimes it's done buy massive price tag.

 

Otherwise ferrari's would be $30,000 and be selling like hotcakes....for a year...then "yawn, yeah I picked up a ferrari, so what"

And I bet people would be a lot quicker to find fault in that $30,000 ferrari than they would a $160,000 one. At 160,000, it would be a "minor glitch I have to take to my mechanic" At $30,000, "this piece of crap import! the radio knob is loose"!!

 

So...the price is $40,000 and with adm $60,000...or $100,000 if the market will bear it. Once the first one is on the block, the price drops, and will continue to drop until it hits the msrp. If it has to go below that, (for a specialty car) is DISASTER!

 

And THAT is the rest of the story.

 

Get over adm's it's a part of life like it or lump it. No I won't be buying a shelby, not because of anything other than I can't afford it. And I won't be buying a 6 cyl bare bones falcon at barret jackson's either because I won't pay $50,000 for one, but SOMEONE WILL.

 

And THAT is why there are adm's!!!!

Edited June 26, 2007 by goinbroke2

[partsisparts]

So, to sum up the thread, $60,000 is fine for a car if it's msrp is $60,000, but it's a rip off if the same car is $60,000 and the msrp is $40,000.

 

mkay....

 

To solve this "incredible" problem, ford should up the msrp to $60,000 (for example). What happens in a few months when the charm wears off and a shelby goes for only $40,000 because that's all it's worth?

 

Everybody is up in arms because the vaunted shelby has lost it's appeal and now can only fetch 2/3 asking price. Suddenly, nobody wants a shelby because (obviously) they can't sell them and are dropping the prices to move them. $20,000 rebate to buy a specialty car!! And you guys yell about $6,000 on a tundra, can you imagine the uproar over dropping the price of a shelby??

 

It is favorable to the manufacture, owner, enthusiest if a car is kept exclusive. Part of that is done buy limited numbers, sometimes it's done buy massive price tag.

 

Otherwise ferrari's would be $30,000 and be selling like hotcakes....for a year...then "yawn, yeah I picked up a ferrari, so what"

And I bet people would be a lot quicker to find fault in that $30,000 ferrari than they would a $160,000 one. At 160,000, it would be a "minor glitch I have to take to my mechanic" At $30,000, "this piece of crap import! the radio knob is loose"!!

 

So...the price is $40,000 and with adm $60,000...or $100,000 if the market will bear it. Once the first one is on the block, the price drops, and will continue to drop until it hits the msrp. If it has to go below that, (for a specialty car) is DISASTER!

 

And THAT is the rest of the story.

 

Get over adm's it's a part of life like it or lump it. No I won't be buying a shelby, not because of anything other than I can't afford it. And I won't be buying a 6 cyl bare bones falcon at barret jackson's either because I won't pay $50,000 for one, but SOMEONE WILL.

 

And THAT is why there are adm's!!!!

 

Dealer profits over the last few years are down. Dealers have been screaming for a car they can make money on. If you priced a Shelby at 60K, FORD would get the extra money, not the dealers.

[Keyser Soze]

Lost of good points coming out here. These cars sell for over list because that's what the market will bear. Ford can't set the market clearing price any more than the dealer can. They try to price the car competitively, but the auto buying public can be very fickle. I'm in full agreement with goinbroke's take on this.

 

Perhaps Ford has left money on the table, but the initial demand is not likely to be sustainable. This is the reason the car can't be priced at the initial demand level. As demand begins to soften, value drops and Ford gets another black eye for discounting a high profile vehicle.

 

Even if Ford could force the dealer to seel the car at list (they can't legally), this does not change the market value of the car. Many, if not most of these cars would be re-sold immediately by profiteers who saw a quick buck. Look at what happened with the PS3 and Wii. Tarket and Best Buy sold these items for much less that the initial market value and essentially passed the extra profit on to individuals. Should a Ford dealer do that? SOMEONE is going to make the extra money. Wouldn't you rather it be the dealer who provides value to Ford by sharing in promotional efforts, holding inventory and servicing vehicles at a reduced warranty rate than some opportunistic jackoff that dissapears after the car is sold?

 

You have to understand that the more profitable a dealer is, the better equipped he is to satisfy the customer both during and after the sale. I have never purchased a car from the lowest priced dealer I could find. I doubt I ever will. If the dealer can pick up an extra $20,000 (or more) on the sale of a Shelby, he can more easily afford to make an out of warranty service adjustment on my Sable. I'm sure that is a lot more important to most buyers than whether or not they have to pay extra for a car they had no intention to purchase in the first place.

[Deanh]

Deanh, i might actually be able to help you make some money...

 

As it turns out Ford does have exactly what you are asking for: Kits that don't void the warranty, and even come with a nice extra. When installed at the time of purchase, they have a 3 year 36,000 mile warranty. Installed after purchase, the warranty is only 12 months.

 

Ford Racing Performance Power Pack Kits

 

You can also get all of the interior pieces right out of your very own parts department, and none of those appearance items are going to void the warranty.

 

Focus on what you can do for the customer (Shelby performance), instead of what you can't (cheap Shelby).

sad thing is we were told aftermarket are not carb ( or Epa...one or the other ) compliant and stupid as it seems NOT warrantied....who knows doesn't make sense to me either as the SAME parts are on the regular Shelbys...but then again...big diff between 500 hp and the 325.........

[Deanh]

Lost of good points coming out here. These cars sell for over list because that's what the market will bear. Ford can't set the market clearing price any more than the dealer can. They try to price the car competitively, but the auto buying public can be very fickle. I'm in full agreement with goinbroke's take on this.

 

Perhaps Ford has left money on the table, but the initial demand is not likely to be sustainable. This is the reason the car can't be priced at the initial demand level. As demand begins to soften, value drops and Ford gets another black eye for discounting a high profile vehicle.

 

Even if Ford could force the dealer to seel the car at list (they can't legally), this does not change the market value of the car. Many, if not most of these cars would be re-sold immediately by profiteers who saw a quick buck. Look at what happened with the PS3 and Wii. Tarket and Best Buy sold these items for much less that the initial market value and essentially passed the extra profit on to individuals. Should a Ford dealer do that? SOMEONE is going to make the extra money. Wouldn't you rather it be the dealer who provides value to Ford by sharing in promotional efforts, holding inventory and servicing vehicles at a reduced warranty rate than some opportunistic jackoff that dissapears after the car is sold?

 

You have to understand that the more profitable a dealer is, the better equipped he is to satisfy the customer both during and after the sale. I have never purchased a car from the lowest priced dealer I could find. I doubt I ever will. If the dealer can pick up an extra $20,000 (or more) on the sale of a Shelby, he can more easily afford to make an out of warranty service adjustment on my Sable. I'm sure that is a lot more important to most buyers than whether or not they have to pay extra for a car they had no intention to purchase in the first place.

agreed...to me a mere 3600 in markup in a vehicle in which we are allocated but 3 all year is absolutely ludicrous ( insert Mike Tyson voice ) a vehicle like that should have 10-15 and thus possibly ( although i doubt it ) limit the ADM's.....y'know there was only 12k in the GT40...so as i have mentioned before...I really don't hold it against dealers doing what they do....

Edited June 26, 2007 by Deanh

[xr7g428]

Automotive Retail is the most dysfunctional business model on the planet. The dealer margins are terrible, and the customers absolutely HATE the experience. Dealers suggest that the way to improve things is to make the process faster, you say the same for being hit by a tornado.

 

Starbucks charges $4 for a .50c cup of coffee and customers love them. Look at every other retail business out there and you won't find any that do things the way car dealers do it. None of this is sufficient evidence that maybe the retail experience might be part of what is broken out there.

 

 

Okay. I give. ADM is a wonderful thing and just because customers associate it with everything they HATE about buying a car, is no reason to try to find a better way.

 

So here is your perfect ADM based world.

 

Ever car is marked with dealer cost. Eliminate all of the hold backs etc, this time dealer cost is real dealer cost. Then the dealer can add their own dealer mark up to every sticker.

 

Your new motto " We overcharge the other guy and pass the savings on to YOU!"

 

Now that customers know for certain that the single overriding goal of the the dealership is to extract ever last cent from each transaction, they are are sure to trust your service department. Needed repairs, unneeded repairs, what's the difference?

 

You may have noticed that the largest, most successful, most profitable, fastest growing, retailers in the world, do not use ADM's. But a bunch of nearly failing car dealers swear by it. And there is not a chance in hell that the car dealers can learn a thing from the rest of the retail world.

 

Toyota has drawn a bead on the buying experience. I guess this just one more area we can afford to give away to the competition.