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Hackett's remedy for sticker shock


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I can't stand Mr. Hackett.  Ford vastly decontented the '20 Fusion and raised prices.  I wouldn't touch one with a ten-foot pole for '20.  Meanwhile, GM has awoken from its "overpriced and undercontented" period and is now INCREASING content for the same prices.  Hence, I spent a LOT of time scouring over GM products at our auto show a few weeks ago.  And not Fords.

In the latest issue of Motor Trend (January) with all the "Of the Year" awards, not one Ford product escaped the remark of "this is WAY overpriced".

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7 minutes ago, CLTEcoBoost said:

I can't stand Mr. Hackett.  Ford vastly decontented the '20 Fusion and raised prices.  I wouldn't touch one with a ten-foot pole for '20.  Meanwhile, GM has awoken from its "overpriced and undercontented" period and is now INCREASING content for the same prices.  Hence, I spent a LOT of time scouring over GM products at our auto show a few weeks ago.  And not Fords.

In the latest issue of Motor Trend (January) with all the "Of the Year" awards, not one Ford product escaped the remark of "this is WAY overpriced".

And GM just spent A LOT of money with new Cruze models, Impala, and Malibu.  So it would stand to reason a model updated in the last 2 years will have more content than a model that has had no updates in 8 years.

 

Ford has reasoned the sales of the Fusion won't be impacted by de-contenting.  It's already in the shitter.  Losing a few more won't hurt.  Just pump them out until the Fusion is done.

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16 minutes ago, CLTEcoBoost said:

In the latest issue of Motor Trend (January) with all the "Of the Year" awards, not one Ford product escaped the remark of "this is WAY overpriced".

 

Motor Trend's remark is correct. This has actually been the case for a long time. MSRPs of most Fords have been a lot more "premium" than the vehicles themselves. As a result, Ford continually resorts to offering massive rebates and other incentives.

 

A better approach would be the following.

1. Improve build and materials quality inside and out, redesigning as needed so they don't look and feel so cheap. This could mean an "emergency refresh" on models like 2020 Escape and 2020 Explorer.

2. Take out features that few customers want. This is part of the "reductive design" approach Hackett is talking about.

3. Add features that customers do want.

 

This will allow Ford to keep MSRPs stable, while reducing rebates and the like. Better for Ford, better for customers. 

Edited by rperez817
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32 minutes ago, CLTEcoBoost said:

I can't stand Mr. Hackett.  Ford vastly decontented the '20 Fusion and raised prices.

 

That's been happening for a long time before Hackett.   Fusion is a special case since they're killing it soon.

 

If you can make the same profit selling 100K vehicles at a higher price compared to selling 150K at a lower price there are a lot of advantages (less overhead, better able to absorb price wars, etc. etc.).  What's good for the consumer isn't always the best business decision.

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3 hours ago, silvrsvt said:

https://www.autonews.com/commentary/hacketts-remedy-sticker-shock

 

 

 

 

Found that interesting-I use mine all the time and my sister's 2020 Explorer XLT didn't have homelink on it. I'm going with that its a slight pain in the ass to setup (was in my old house, but it had better security) and its just easier for users to use the remotes they have for garage door openers (if they have them-wonder what the market penetration is for that) to open them...plus I'd say better then 80% of the people on my block don't even use their garages for their cars. 

 

I use mine daily.  But obviously if you don't have a garage door, you don't need a homelink thing.  I'd be incredibly disappointed if they got rid of it.

 

That said, I wonder if they could integrate that system into the SYNC screen - instead of the physical button on the visor, you'd have "homelink" buttons on a menu in the center screen.

 

2 hours ago, silvrsvt said:

 

Newer construction is like that-I had a friend live in a townhouse development that was built in the late 1990s and they claimed that a midsize car could fit into the garage-which was complete bullshit. You couldn't even open the doors of a Focus or Fiesta in it! The parking was terrible too...it was so bad that people used up all the parking and was on street parking-and supposedly a fire truck could make it down the street still, which was more BS-that Firetruck would have ripped off alot of rear view mirrors and smacked into parked cars getting to a call.

 

My old house had a nice garage but my current house is from the 1990s and its gonna be a tight fit fitting my SHO into it. We don't currently use it because garage door opener issues (long story-garage doors where jacked up and replaced, but they didn't put an opener on the one side and left us one to install-plus the electrical was completely rigged-used extension cords!!!! Getting that fixed next month)  

 

I laugh at a lot of new construction "2" car garages.  Maybe if you had 2 Smart cars.

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51 minutes ago, rperez817 said:

 

Motor Trend's remark is correct. This has actually been the case for a long time. MSRPs of most Fords have been a lot more "premium" than the vehicles themselves. As a result, Ford continually resorts to offering massive rebates and other incentives.

 

A better approach would be the following.

1. Improve build and materials quality inside and out, redesigning as needed so they don't look and feel so cheap. This could mean an "emergency refresh" on models like 2020 Escape and 2020 Explorer.

2. Take out features that few customers want. This is part of the "reductive design" approach Hackett is talking about.

3. Add features that customers do want.

 

This will allow Ford to keep MSRPs stable, while reducing rebates and the like. Better for Ford, better for customers. 

rebates are down substantially , and 0% isn't on their whole lineup as WAS the regular practice...Ford literally told us they were cutting production back ( I believe 30% was the figure used ) to avoid dealers stockpiling inventory and forcing Ford to have massive rebates to move said vehicles. The ONLY unit they hjave persisted with large incentives is their crown Jewel, the F150...but even then, the ;lease payments are substantially higher than say 3 -5 years ago...

Edited by Deanh
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8 minutes ago, Deanh said:

rebates are down substantially , and 0% isn't on their whole lineup as WAS the regular practice...Ford literally told us they were cutting production back ( I believe 30% was the figure used ) to avoid dealers stockpiling inventory and forcing Ford to have massive rebates to move said vehicles. The ONLY unit they hjave persisted with large incentives is their crown Jewel, the F150...but even then, the ;lease payments are substantially higher than say 3 -5 years ago...

 

Low interest rates are also because the prime rate has rised a bit over the past couple years too

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16 minutes ago, silvrsvt said:

 

Low interest rates are also because the prime rate has rised a bit over the past couple years too

yep...not only that...when  you don't have thousands of vehicles just sitting gathering dust, one doesn't haver to incentivize as much to move them...this time of year theres usually a run on Commercial vehicles due to tax write offs...we don't have product. Current incentives on a Superduty are $1000 + $500 end of year commercial with 3.9...compared to years past, that's a pittance.

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4 hours ago, akirby said:

That's all I've ever used since 2000.   I bought a Lariat visor for my new F150 XLT just to get the opener buttons.  I hate having those clip on openers on the visor.

 

Now if you said 70% don't park in a garage I could believe that.   I widened 2 of our 3 garage doors by 1 foot when we built the house otherwise we wouldn't be able to park in there.   The neighborhood where we rented while building the new house had about 30 houses and I think only one or two actually parked in the garage.  The only thing that would fit with enough room to actually open the doors was a Miata.   The new house right down the street looks to have the same 8 foot doors with only a foot or so on either side.   It's ridiculous.

That’s because developers are selling two and a half car garages as three car garages, and it is ridiculous.in the past when looking at houses, the garage is the first thing I consider. If my vehicles wouldn’t fit comfortably it was out. People don’t pay close enough attention to it and the next thing they know they can’t fit the cars they want into them. 

 

I personally love Homelink as well, as it keeps thing nice and tidy looking. 

Edited by tbone
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30 minutes ago, Deanh said:

The ONLY unit they hjave persisted with large incentives is their crown Jewel, the F150...

 

You'll also notice that only the XLT has the huge rebates.  XL is smaller and Lariat and higher trims are sometimes much smaller.  When I bought my XLT there was $6K rebate vs. $1500 for Lariat.  That made the price difference about $9K.

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4 hours ago, silvrsvt said:

https://www.autonews.com/commentary/hacketts-remedy-sticker-shock

 

 

 

 

Found that interesting-I use mine all the time and my sister's 2020 Explorer XLT didn't have homelink on it. I'm going with that its a slight pain in the ass to setup (was in my old house, but it had better security) and its just easier for users to use the remotes they have for garage door openers (if they have them-wonder what the market penetration is for that) to open them...plus I'd say better then 80% of the people on my block don't even use their garages for their cars. 

 

My Flex has homelink (Fusion doesn't) and I love it. Like akirby, I hate having the remote clipped onto the visor. Only took me 15 seconds to program it. 

 

4 hours ago, akirby said:

That's all I've ever used since 2000.   I bought a Lariat visor for my new F150 XLT just to get the opener buttons.  I hate having those clip on openers on the visor.

 

Now if you said 70% don't park in a garage I could believe that.   I widened 2 of our 3 garage doors by 1 foot when we built the house otherwise we wouldn't be able to park in there.   The neighborhood where we rented while building the new house had about 30 houses and I think only one or two actually parked in the garage.  The only thing that would fit with enough room to actually open the doors was a Miata.   The new house right down the street looks to have the same 8 foot doors with only a foot or so on either side.   It's ridiculous.

 

I can fit 2 cars in my garage, but the problem is because my garage is so close to the house I have to make a weird arch to park on the left side and it's impossible to do with the Fusion if the Flex is already parked. Parking the Flex on that side is a nonstarter. Even if I replace the Fusion with a used Fiesta it would be very hard to park there. Parking on the street is also not really an option because my neighbors are assholes and have way too many cars so there's never anywhere for me to park when I get home from work. 

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1 hour ago, akirby said:

 

You'll also notice that only the XLT has the huge rebates.  XL is smaller and Lariat and higher trims are sometimes much smaller.  When I bought my XLT there was $6K rebate vs. $1500 for Lariat.  That made the price difference about $9K.

Rather strange how they push certain packages and not others...same with the Rangers....

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35 minutes ago, Deanh said:

Rather strange how they push certain packages and not others...same with the Rangers....


Pushing XLT/package with rebates does a few things, the ones pushed are going to have the highest resale value % of value. It also raises ATP's as ATP's are figured before rebates, Makes leasing cheaper for them as the cash goes for the down payment, this gets Ford repeat customers in a few years when the lease is due then gets dealers CPO F-150 in 3 years to sell to customers that can't get approved for a new vehicle which are also usually financed again through Ford along with extended warranty through Ford.  

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4 minutes ago, jasonj80 said:


Pushing XLT/package with rebates does a few things, the ones pushed are going to have the highest resale value % of value. It also raises ATP's as ATP's are figured before rebates, Makes leasing cheaper for them as the cash goes for the down payment, this gets Ford repeat customers in a few years when the lease is due then gets dealers CPO F-150 in 3 years to sell to customers that can't get approved for a new vehicle which are also usually financed again through Ford along with extended warranty through Ford.  

I would add, it makes me think those enamored with the Lariats, Limited's and Platinum's have obviously more disposable income and aren't worried as much about MSRP's and payments...so Ford markets that way

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1 minute ago, snooter said:

Its 2019 and detroit still has that sentiment ingrained....nothing has changed in detroit since 73

 

Yes sir snooter. It's a toxic culture where managers at those companies keep making the same mistakes over and over, screwing over their customers, their employees, and their investors.

 

Jim Hackett is trying hard to get Ford out of that hole.

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2 hours ago, Harley Lover said:

 

Excellent summary statement of what is wrong with most car companies.


Not exactly what I meant.  
 

As an example, it would be great for consumers if Ford put a $10k rebate on a $25k Escape but that’s an asinine business decision.
 

But I agree that Ford and most other mfrs don’t do enough to delight their customers.

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ford’s strategy of pursuing higher ATP’s doesn’t seem to work well with what Hackett is saying here. If you want me to pay more for a vehicle, I better be getting more and I better be getting the vehicle built how I want it, not limited to some predetermined option packages put together by the bean counters.

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I use my homelink, I also use my Entry KeyPad, which I can see them removing next.  Everything they want to remove is probably worth a few dollars, and it will really do nothing to bring the prices down. This will not end well.  Last Sonata I inspected had much more attention to detail, than an MKZ/Fusion. NOT a good sign.

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21 minutes ago, T-dubz said:

ford’s strategy of pursuing higher ATP’s doesn’t seem to work well with what Hackett is saying here. If you want me to pay more for a vehicle, I better be getting more and I better be getting the vehicle built how I want it, not limited to some predetermined option packages put together by the bean counters.


That’s not the strategy.  The strategy is don’t overproduce because that causes rebates and that kills your profit margin.  Build vehicles that people want to buy that can be sold at a good margin like F-150 where $60k trucks only have a $1500 rebate.  Build things that have very little direct competition like Bronco and Baby Bronco.  Don’t get into price wars with the Koreans or anyone else.  Price the vehicle where it can be sold with a good margin even if it means lower volume.  And I do agree you can’t do that with stupid decontenting but I don’t think we’ll see that on the new stuff starting next year.  Remember everything we’ve seen so far was started pre Hackett.

 

Its not about increasing the price as much as reducing the discounts and choosing products that can be sold without huge discounts.

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8 hours ago, akirby said:

Its not about increasing the price as much as reducing the discounts and choosing products that can be sold without huge discounts.

 

Yes sir. That's a good strategy. To fulfill that strategy, Ford needs to first improve product quality to attract more customers who aren't Ford loyalists.

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On 12/5/2019 at 11:40 PM, akirby said:

 Don’t get into price wars with the Koreans or anyone else. 

Yes, never fall victim to one of the classic blunders. Of course the most famous is never get involved in a land war in Asia, but only slightly less well-known is this: never go in against a Sicilian when death is on the line! 

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7 minutes ago, mybkvu said:

Yes, never fall victim to one of the classic blunders. Of course the most famous is never get involved in a land war in Asia, but only slightly less well-known is this: never go in against a Sicilian when death is on the line! 

 

Inconceivable!

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