Ford speaks

[KingKona]

Everyone loves to think that they outsmarted the dealer and got some special deal because of some super negotiating skills, but at the end of the day the dealer HAS to make money on the transaction (even if they are not gouging you) or they go out of business. Yes, with the current sales model, some people will get better deals than others, but everyone puts cash into the dealer's pocket AND into Ford's. Because of this simple fact, you will always pay more when there is a middleman involved. The best anyone can ever hope for with the dealer model is to not overpay.

Yes, Ford will try to claim as much of the profit for themselves as they can, but supply and demand always end up ruling the day and if their prices are too high, their cars won't sell.

I got somewhere around $7,000.00 off sticker.

So in your dystopian idea of a car sales future, I would have paid sticker. The idea of getting rid of dealerships would have cost me $7K, because there would be no price competition.

Your conceptual application of the Law of Supply and Demand is incorrect.

When was the last time Ford changed (lowered) MSRP due to weakened demand? When was the last time Tesla did that? Tesla certainly never, Ford has done it through rebates and free financing, through the dealerships. And the pressure to offer rebates and other price cuts as incentives, is because units were sitting on lots not selling, costing dealerships big $$ in finance charges. There was big pressure to lower prices to move units, as excess inventory costs a lot of $$.

Let's say Ford ends dealerships tomorrow; MSRP on Mustangs will be the same, it won't lower. Ford will be making massively higher profits. There will be NO price negotiation, you will pay MSRP, and that's it. With vehicles being sold strictly through orders (no dealerships with cars on the lot), there is no supply & demand law in effect, because there's no inventory sitting losing value. Ford will build as many as needed, and no more.

This is nothing more than Ford Execs looking and Tesla's business model and thinking "Yeah, we'll have some of that!!".

In the end, you will pay thousands more for a Mustang.

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[ay1820]

I got somewhere around $7,000.00 off sticker.

So in your dystopian idea of a car sales future, I would have paid sticker. The idea of getting rid of dealerships would have cost me $7K, because there would be no price competition.

Your conceptual application of the Law of Supply and Demand is incorrect.

When was the last time Ford changed (lowered) MSRP due to weakened demand? When was the last time Tesla did that? Tesla certainly never, Ford has done it through rebates and free financing, through the dealerships. And the pressure to offer rebates and other price cuts as incentives, is because units were sitting on lots not selling, costing dealerships big $$ in finance charges. There was big pressure to lower prices to move units, as excess inventory costs a lot of $$.

Let's say Ford ends dealerships tomorrow; MSRP on Mustangs will be the same, it won't lower. Ford will be making massively higher profits. There will be NO price negotiation, you will pay MSRP, and that's it. With vehicles being sold strictly through orders (no dealerships with cars on the lot), there is no supply & demand law in effect, because there's no inventory sitting losing value. Ford will build as many as needed, and no more.

This is nothing more than Ford Execs looking and Tesla's business model and thinking "Yeah, we'll have some of that!!".

In the end, you will pay thousands more for a Mustang.

Do you really think that the dealer took a $7k loss? Built into the MSRP is a profit margin for the dealers. The dealers will on occasion eat into that margin a bit on their own, but if the eat into too much they will go out of business. More likely is that Ford had some sort of incentive with the dealer that allowed him to lower his selling price, while keeping his margins whole.

Manufacturers effectively lower MSRP all the time. Sometimes it is in the form of a publicly advertised rebate or financing program, but more often it is based on a dealer only rebate and incentive programs. Those programs can be based on things like overall dealer volume, or the dealers ability to move certain makes or models. Dealers are often required to take certain quantities of vehicles they don't want in order to get allocations of vehicles they do want, resulting in the dealer having to amortize the cost of selling low margin cars by looking for higher margins on more popular models. All of this happens behind the scenes and you never know what the dealer is truly paying the manufacturer, but I guarantee that the dealer is making profit and that profit comes out of your wallet.

You are right that Ford wants to keep more of the profit for themselves, but if the price is too high the customer won't buy. It is that simple.

They will set the price as high as they can while still making their volume goals. All the money that Ford uses to incentivize the dealer is now on the table to be used to incentivize the buyer. In times like we are seeing right now, Ford will keep as much of that for themselves as they can, but if the market slows, then you can count on Ford using that money to directly incentivize the buyers if they are selling direct.

You an choose to believe this or not. Time will tell.

 

[Mspider]

I got somewhere around $7,000.00 off sticker.

So in your dystopian idea of a car sales future, I would have paid sticker. The idea of getting rid of dealerships would have cost me $7K, because there would be no price competition.

Your conceptual application of the Law of Supply and Demand is incorrect.

When was the last time Ford changed (lowered) MSRP due to weakened demand? When was the last time Tesla did that? Tesla certainly never, Ford has done it through rebates and free financing, through the dealerships. And the pressure to offer rebates and other price cuts as incentives, is because units were sitting on lots not selling, costing dealerships big $$ in finance charges. There was big pressure to lower prices to move units, as excess inventory costs a lot of $$.

Let's say Ford ends dealerships tomorrow; MSRP on Mustangs will be the same, it won't lower. Ford will be making massively higher profits. There will be NO price negotiation, you will pay MSRP, and that's it. With vehicles being sold strictly through orders (no dealerships with cars on the lot), there is no supply & demand law in effect, because there's no inventory sitting losing value. Ford will build as many as needed, and no more.

This is nothing more than Ford Execs looking and Tesla's business model and thinking "Yeah, we'll have some of that!!".

In the end, you will pay thousands more for a Mustang.

The competition will come from manufacturer vs manufacturer. Not dealership vs dealership. This is why Ford won`t be able to sell a car for whatever price they want. I guess people forgot about this part of the business. You will price shop between manufactures not dealerships.

To your point about paying under MSRP. Most people are not getting these kinds of deals. Most people also do not like to haggle around with sales people. Also what makes you think Ford won`t be able to run a discount on a car when selling direct?

 

[KingKona]

The competition will come from manufacturer vs manufacturer. Not dealership vs dealership. This is why Ford won`t be able to sell a car for whatever price they want. I guess people forgot about this part of the business. You will price shop between manufactures not dealerships.

To your point about paying under MSRP. Most people are not getting these kinds of deals. Most people also do not like to haggle around with sales people. Also what makes you think Ford won`t be able to run a discount on a car when selling direct?

Great!! What competitor for the Mustang will I be price shopping against?

You're suggesting a dream-world where less competition and more manufacturer control of pricing means you'll pay less. That's a fantasy world I promise you doesn't exist. The complete opposite will be true.

How about one example of that ever happening? Ever?

And yes, $7K off was standard just a few years ago. At dealerships all over the country. And it required no haggling. They were advertised prices on the internet. That's called a free-market and price competition.

But your idea to get back to those prices is to get rid of all those dealerships all over the country?

I never said Ford won't be able to run a discount, I wrote they won't. And to think they will would be naïve.

Mind me asking how old you are?

 

[KingKona]

Do you really think that the dealer took a $7k loss? Built into the MSRP is a profit margin for the dealers. The dealers will on occasion eat into that margin a bit on their own, but if the eat into too much they will go out of business. More likely is that Ford had some sort of incentive with the dealer that allowed him to lower his selling price, while keeping his margins whole.

Manufacturers effectively lower MSRP all the time. Sometimes it is in the form of a publicly advertised rebate or financing program, but more often it is based on a dealer only rebate and incentive programs. Those programs can be based on things like overall dealer volume, or the dealers ability to move certain makes or models. Dealers are often required to take certain quantities of vehicles they don't want in order to get allocations of vehicles they do want, resulting in the dealer having to amortize the cost of selling low margin cars by looking for higher margins on more popular models. All of this happens behind the scenes and you never know what the dealer is truly paying the manufacturer, but I guarantee that the dealer is making profit and that profit comes out of your wallet.

You are right that Ford wants to keep more of the profit for themselves, but if the price is too high the customer won't buy. It is that simple.

They will set the price as high as they can while still making their volume goals. All the money that Ford uses to incentivize the dealer is now on the table to be used to incentivize the buyer. In times like we are seeing right now, Ford will keep as much of that for themselves as they can, but if the market slows, then you can count on Ford using that money to directly incentivize the buyers if they are selling direct.

You an choose to believe this or not. Time will tell.

Who said anyone took a $7K loss? Ever been in the car sales business?

And FWIW, the rest of what you posted is incorrect, as it's all based on "volume goals" that would be completely non-existent in a special-order-only car sales market.

Ford will have MSRP, and they will have 0 financial motivation to deviate from selling at it.

Just like.....wait for it.......Tesla.

 

[Mspider]

Great!! What competitor for the Mustang will I be price shopping against?

You're suggesting a dream-world where less competition and more manufacturer control of pricing means you'll pay less. That's a fantasy world I promise you doesn't exist. The complete opposite will be true.

How about one example of that ever happening? Ever?

And yes, $7K off was standard just a few years ago. At dealerships all over the country. And it required no haggling. They were advertised prices on the internet. That's called a free-market and price competition.

But your idea to get back to those prices is to get rid of all those dealerships all over the country?

I never said Ford won't be able to run a discount, I wrote they won't. And to think they will would be naïve.

Mind me asking how old you are?

Before getting my mustang I was interested in a Camaro SS and I put a order in for a BMW M240i (my parents are taking the car now). I also sold my Toyota Supra for my Mustang. It doesn't have to be a direct competitor to cross shop either. I was interested in a WRX STI but they are no longer making them. But the direct competition would obviously be camaro and challenger. I really enjoyed custom ordering my car from Ford.

I do believe if every car brand was running a Tesla type business model they would run discounts or rebates. But of course this is just speculating and it could very easily be worse for consumers like you said. You are looking for a example of it but the industry isn't there yet. I accept your viewpoint as a possibility also.

I am in my early 30s.

 

[KingKona]

Before getting my mustang I was interested in a Camaro SS and I put a order in for a BMW M240i (my parents are taking the car now). I also sold my Toyota Supra for my Mustang. It doesn't have to be a direct competitor to cross shop either. I was interested in a WRX STI but they are no longer making them. But the direct competition would obviously be camaro and challenger. I really enjoyed custom ordering my car from Ford.

I do believe if every car brand was running a Tesla type business model they would run discounts or rebates. But of course this is just speculating and it could very easily be worse for consumers like you said. You are looking for a example of it but the industry isn't there yet. I accept your viewpoint as a possibility also.

I am in my early 30s.

The Camaro is GONE. The WRX STI is GONE. Challengers and Chargers are GONE.

Once again, I ask you, exactly what cars am I price-shopping a Mustang against in the dystopian future of no dealerships? Where is this "manufacturer vs manufacture price competition" you described?

If there are no dealerships, and all sales are direct through Ford special order, Ford will price Mustangs at whatever they want. And they won't deviate from that price, there would be no reason to do that.

There is something called a free-market economy. And a single-source price-fixing scheme is very, very much against that.

 

[Bikeman315]

@Mspider & @ay1820 it doesn't matter we say, @KingKona is 100% sure that by Ford taking their business direct we, the consumer, is going to get royally screwed and will never again have an opportunity to a great buy on a new car. Well, who knows, he might be right. Of course none of us will know until, and if, Ford takes the ICE business direct. At that point we can discuss the ins and outs of trying to get a deal on car bought directly from the manufacture.

 

[Bikeman315]

The Camaro is GONE. The WRX STI is GONE. Challengers and Chargers are GONE.

Once again, I ask you, exactly what cars am I price-shopping a Mustang against in the dystopian future of no dealerships? Where is this "manufacturer vs manufacture price competition" you described?

If there are no dealerships, and all sales are direct through Ford special order, Ford will price Mustangs at whatever they want. And they won't deviate from that price, there would be no reason to do that.

There is something called a free-market economy. And a single-source price-fixing scheme is very, very much against that.

You do realize that if this actually does happen the Mustang as we now know it will also be gone. As well as most new ICE vehicles. I'm really not sure why you continue to battle a war that hasn't even happened yet.

 

[Mspider]

The Camaro is GONE. The WRX STI is GONE. Challengers and Chargers are GONE.

Once again, I ask you, exactly what cars am I price-shopping a Mustang against in the dystopian future of no dealerships? Where is this "manufacturer vs manufacture price competition" you described?

If there are no dealerships, and all sales are direct through Ford special order, Ford will price Mustangs at whatever they want. And they won't deviate from that price, there would be no reason to do that.

There is something called a free-market economy. And a single-source price-fixing scheme is very, very much against that.

Yea I totally expect there to be competitor sports car type cars in the mustang price range forever.

There is not going to be a single car that holds a entire market to themselves. Not even Bugatti has a market like that.

You are asking for examples and I already gave you some. So I don`t know what else to say.

 

[KingKona]

You do realize that if this actually does happen the Mustang as we now know it will also be gone. As well as most new ICE vehicles. I'm really not sure why you continue to battle a war that hasn't even happened yet.

You don't know what I'm refuting with my posts, and it's nothing you just mentioned.

 

[Mspider]

@Mspider & @ay1820 it doesn't matter we say, @KingKona is 100% sure that by Ford taking their business direct we, the consumer, is going to get royally screwed and will never again have an opportunity to a great buy on a new car. Well, who knows, he might be right. Of course none of us will know until, and if, Ford takes the ICE business direct. At that point we can discuss the ins and outs of trying to get a deal on car bought directly from the manufacture.

Yea we are all just guessing what will happen. He might very well could be right. Common for people to question changes like this and think only negative.

 

[KingKona]

Yea I totally expect there to be competitor sports car type cars in the mustang price range forever.

There is not going to be a single car that holds a entire market to themselves. Not even Bugatti has a market like that.

You are asking for examples and I already gave you some. So I don`t know what else to say.

Try this; It's 2025, and Ford has stopped doing business with dealers for all it's vehicles. All Ford vehicles are direct special order sales.

I'm a "Mustang guy", and I want a new Mustang. And I want the best price. But Ford only has one price.

How do I ensure I get my best value?

 

[Bikeman315]

You don't know what I'm refuting with my posts, and it's nothing you just mentioned.

I know what you want. I am 70, worked for both manufacturers and dealers but that would mean nothing to you. You just want to argue so there is no sense in continuing. Have a nice day.

 

[Mspider]

You don't know what to say to support your claims?

Again, give us all some examples of your "manufacturer vs manufacture price competition" that will ensure that I get the best price on a Mustang.

Basically anything you buy right now has corporate or manufacture competition pricing right now.

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