Factory Incentives

[67Goat]

First off, I'm a pretty loyal Ford customer (6 of 10 vehicles I've owned have been Fords). While I don't "bleed blue" there's definitely a blue tint. I also tend to keep my vehicles for a while (10+ years), so the opportunity to earn my business on a new vehicle doesn't come around that often. I'm currently in the market for a truck to replace my '97 F150. I"ve hooked up with a great salesman at a local dealership who has agreed to order a truck for me. In fact, he's ordered it "in good faith" as dealer stock rather than as a sold order. In my eyes, the dealer has done his job, he's earned my business. Here's the rub, in my zip code, Ford has just lowered their rebate by $500. Not a huge deal, but unexpected and disappointing. More importantly (at least to me), is the fact that they didn't give me the $750 coupon offer with the brochure that I ordered. When you combine the two, it starts to reach a fairly significant amount ($1250). This deal, so far, has been done on a handshake and honoring my word is important. However, there was also an expectation (ballpark) of what the final price would be and corporate policy is having an impact. I admit that I have some heartburn with walking away from my "agreement", but the net change of $1250 has put me on the bubble. Frankly, I'm not asking for special treatment, but I certainly expect to recieve the same treatment as others (i.e. a coupon). I fully realize that rebates and coupons aren't entitlements, just marketing tools, but they seem to take a very short sighted approach to the market. Monthly and quarterly changes align well with sales goals and measures, but not so well with the customer.

 

I think it's time for the 40 pound brains in Ford marketing to take a hard look at legacy incentive programs and take the lead with something broad, sustainable and innovative. Ford has clearly done it with the product, why not with incentives?

[Jvrad3]

Hello.. From what you stated in your post, I'm under the impression that you may not be informed as to how the order process works. I actually decided to take my business elsewhere because of the same situation of the dealer saying they would order me a truck as a stock order. The reason that the dealer wants you to let him order a truck as "stock" is because if you place a "retail" order (truck is built as a sold unit), those orders generally take precedence over the stock order and are built first. Another advantage of placing a retail order is that Ford has an incentive protection program that enables you to either take the incentives that are available at the time of order, or if better, you can take the incentives that are available upon delivery. But, some things such as the coupon you mentioned are not protected. I have also heard that if you call Ford customer service, alot of times they will send you the coupon. Just don't let them fool you into thinking that they are helping you out by placing a "stock" order.

[akirby]

those orders generallyalways take precedence over the stock order and are built first.

 

Fixed it for you. Retail orders are restricted to priorities 10-19 while stock orders are 20+.

[Jvrad3]

Thanks a kirby.. 67goat, If you want more info on exactly how the whole order process works, here is a lengthy explanation.

http://www.greenhybrid.com/discuss/f61/ford-dealer-discusses-orders-allocation-19747/

[ice-capades]

Hello.. From what you stated in your post, I'm under the impression that you may not be informed as to how the order process works. I actually decided to take my business elsewhere because of the same situation of the dealer saying they would order me a truck as a stock order. The reason that the dealer wants you to let him order a truck as "stock" is because if you place a "retail" order (truck is built as a sold unit), those orders generally take precedence over the stock order and are built first. Another advantage of placing a retail order is that Ford has an incentive protection program that enables you to either take the incentives that are available at the time of order, or if better, you can take the incentives that are available upon delivery. But, some things such as the coupon you mentioned are not protected. I have also heard that if you call Ford customer service, alot of times they will send you the coupon. Just don't let them fool you into thinking that they are helping you out by placing a "stock" order.

 

Your information is correct. But while Ford now restricts priority codes 10-19 to customer retail orders and stock orders to priority codes 20+ it's in the Dealer's best interest to order units promised to customers as retail orders so that the factory incentives can be locked in. The Dealer gets the unit scheduled and available to the customer sooner than a stock order, the customer has the option of using the locked in incentives and the Dealer has the opportunity to turn over the unit sooner helping to earn future allocation.

 

However, don't get the idea that Dealers can just go ahead and "fudge" the allocation scheduling system by putting retail orders in the order bank. Ford is now monitoring the Dealer retail orders and if a Dealer has more than a resonable number of retail orders built and not reported sold within a certain timeframe after arrival, the Dealership will be subject to penalties regarding retail orders.

[Jvrad3]

Your information is correct. But while Ford now restricts priority codes 10-19 to customer retail orders and stock orders to priority codes 20+ it's in the Dealer's best interest to order units promised to customers as retail orders so that the factory incentives can be locked in. The Dealer gets the unit scheduled and available to the customer sooner than a stock order, the customer has the option of using the locked in incentives and the Dealer has the opportunity to turn over the unit sooner helping to earn future allocation.

 

However, don't get the idea that Dealers can just go ahead and "fudge" the allocation scheduling system by putting retail orders in the order bank. Ford is now monitoring the Dealer retail orders and if a Dealer has more than a resonable number of retail orders built and not reported sold within a certain timeframe after arrival, the Dealership will be subject to penalties regarding retail orders.

 

 

Thanks for the info

[67Goat]

Thanks for all the great info. I wasn't aware of the prioritization differences between retail and stock orders. However, I did realize that with a stock order vs. retail order the rebates were "at risk". Obviously, I expected the rebate to get better or at least stay the same. In my case, I don't think that the type of order slowed down the build at all. The order was placed on March 28 and the truck is scheduled to be built on April 19th. The dealership claims to be the #10 dealer in the country, so maybe their volume helps their allocation and scheduling.

 

I guess my main point is that I think the rebate model for sales is getting a bit long in the tooth. They are in effect driving by looking in the rear view mirror. There are hundreds of different ways that a particular dealership or salesman will put a deal together. Ford should design incentive programs that better support what the guys in the trenches are doing. While I think the idea of locking in rebates is a good step, it's really just a minor update to the existing program. When it comes to business deals, most people don't like surprises. Even if it's a "good" surprise, there's now a guy who bought a car yesterday, that isn't happy anymore.

[akirby]

Thanks for all the great info. I wasn't aware of the prioritization differences between retail and stock orders. However, I did realize that with a stock order vs. retail order the rebates were "at risk". Obviously, I expected the rebate to get better or at least stay the same. In my case, I don't think that the type of order slowed down the build at all. The order was placed on March 28 and the truck is scheduled to be built on April 19th. The dealership claims to be the #10 dealer in the country, so maybe their volume helps their allocation and scheduling.

 

I guess my main point is that I think the rebate model for sales is getting a bit long in the tooth. They are in effect driving by looking in the rear view mirror. There are hundreds of different ways that a particular dealership or salesman will put a deal together. Ford should design incentive programs that better support what the guys in the trenches are doing. While I think the idea of locking in rebates is a good step, it's really just a minor update to the existing program. When it comes to business deals, most people don't like surprises. Even if it's a "good" surprise, there's now a guy who bought a car yesterday, that isn't happy anymore.

 

Therein lies the problem. Everybody "expects" rebates when they should really only be used in exception cases where there are too many vehicles in stock due to unexpected circumstances.

 

I don't think Ford wants to perpetuate the rebate model. They would prefer not to have them at all.

[Marginal Economist]

Supply for product is tight. Ford does not need the same level of incentives to move the product. There is a reason it is called an "incentive".

 

The tragedy in Japan is going to affect all production and average transaction prices will go up. This should also translate into higher trade offers. Dealers are scrambling for more used cars to haver something on their lots.

 

It is time to get away form the rebate model, but the average customer has more inequity than money down and the banks are still tighter with their financing.

[lakeguy]

As a recent customer who's had to navigate the rebate maze, I'd also vote to eliminate the rebates. While I love the product, and in the end feel I got good value for the money, the haggling over the rebates left a bad taste. In the end, I was left defending a $500 rebate with a dealer with whom I had (and hope still have) a good relationship. On a +$40K cost, we were left haggling over $500, 1% of the deal.

 

The scenario becomes more frustrating when you look at the incentives based on financing. If you look at this months advertised F-150 incentives, you are led to believe that you can get a 2.9% loan for 36 months (assuming good credit and approval) along with a $1000 rebate. However, in the small print, there are many qualifiers, including that you need to talk to your dealer for details, and terms may very by region.

 

In my case, this translated into, "You only get the $1000 if the rate is 5.9% and you agree to keep it for 90 days. If you want the 2.9%, the rebate is only $500." In the end, you will pay the money. I understand this. It's business. But the fact that none of these "rules" are clear or available ends up making it feel like a shell game, and in the end it seems the dealer can shape the rules to the end price needed.

 

Again, I understand the need for a dealership, and Ford, to make a reasonable profit, and I'm sure in a business plan somewhere, the bottom line number is defined. Just don't make it so mysterious, frustrating, and seemingly devious, to get there.

[69cat]

As a recent customer who's had to navigate the rebate maze, I'd also vote to eliminate the rebates. While I love the product, and in the end feel I got good value for the money, the haggling over the rebates left a bad taste. In the end, I was left defending a $500 rebate with a dealer with whom I had (and hope still have) a good relationship. On a +$40K cost, we were left haggling over $500, 1% of the deal.

 

The scenario becomes more frustrating when you look at the incentives based on financing. If you look at this months advertised F-150 incentives, you are led to believe that you can get a 2.9% loan for 36 months (assuming good credit and approval) along with a $1000 rebate. However, in the small print, there are many qualifiers, including that you need to talk to your dealer for details, and terms may very by region.

 

In my case, this translated into, "You only get the $1000 if the rate is 5.9% and you agree to keep it for 90 days. If you want the 2.9%, the rebate is only $500." In the end, you will pay the money. I understand this. It's business. But the fact that none of these "rules" are clear or available ends up making it feel like a shell game, and in the end it seems the dealer can shape the rules to the end price needed.

 

Again, I understand the need for a dealership, and Ford, to make a reasonable profit, and I'm sure in a business plan somewhere, the bottom line number is defined. Just don't make it so mysterious, frustrating, and seemingly devious, to get there.

I also plan on taking the rebates and refinancing with a local credit union for 2.59. I wasn't planning on waiting the 90 days unless there is something you had to sign agreeing to this. Have seen other topics about the dealer wanting you to wait so they get some type of credit but all have said there is nothing in writing.

[FLLMTR]

I was under the impression that most incentives were limited to dealer stock in order to clear current inventory. I was not aware a customer could order a vehicle and still get the incentives. Is this right?

[akirby]

I was under the impression that most incentives were limited to dealer stock in order to clear current inventory. I was not aware a customer could order a vehicle and still get the incentives. Is this right?

 

What that means is you get the incentives when the vehicle arrives, not when you order. However, most dealers can now lock in the incentives when you place the order - although it may not apply to all incentives. Check with the dealer for details.

[cmurph89]

I am with you on the rebates and feeling frustrated. I ordered a Ford Fusion on Feb 21st and was told it would take 6-8 wks. I called Ford and ordered a brochure on a tip and got the $750 special offer, but it expired April 5th. I signed up online for some brochures, etc and got a 2nd one good until May 2nd. Well, my car is taking much longer than expected and isn't even being built until May 2nd and delivery is scheduled for May 23rd. I called Ford's customer service requesting another one since that was part of the reason I ordered the car I did with all the extra options. She said they will send me another brochure, but it's unlikely I'll get another coupon because they are often limited to 1 or 2 offers per household. She said she had no control of it and couldn't manually mail me one. Come on Ford...we are loyal Ford customers and I talked my mom & dad into ordering a new Edge & my sister-in-law is also in the process of getting a new Ford...Both had planned to go Chevy. I think I deserve this rebate, especially since it is taking so much longer than I was told. (nothing against my dealership...they are awesome and that is who I feel my loyalty is too at this point).