Jump to content
TEAM SHELBY FORUM

PROOF THE ADM IS WORTH IT


ratnacage

Recommended Posts

The subject of the value of the ADM has been discussed ad nausium in purely subjective terms (I want it now, it's a "Shelby" etc). I did some research and figuring because 1) I'm a nerd, and 2) I think the issue desrves to have some hard numbers applied to it.

 

I'll start with the basic premise that the GT500 is a 550 hp car because with a few very inexpensive mods it is and in that configuration your warranty is still intact. I'll also assume that the buyer wants a Mustang with 550 hp and excellent handling and ride, and the buyer isn't his own mechanic.

 

You are now left with the choice of building a Mustang GT to that level or buying the GT500. In order to build a Mustang GT to equal the performance of the GT500, the following mods need to be done: CAI, high output intercooled SC, full stainless exhaust with long tube headers, handling pack, hurst shifter, high perf clutch, gauges, forged internals (to maintain reliability), pulleys, full custom tune on dyno, a decent set of wheels and tires, and of course racing stripes (gotta have 'em). Include professional installation/labor. On a typical Mustang GT, you're looking at about a $50k total investment (and this doesn't even include a 6-speed tranny).

 

Three years later, that Mustang won't be worth too much more than a bone stock car. Think about it, "race" cars depreciate worse than stock cars so you'll see little to no return on your investment with few exceptions. Anyone that's tried to sell one knows this. But assume that in three years the car is worth 60% of the original MSRP of $29k, or $17,400. Thus, your net loss is $32,600.

 

Let's assume the GT500 also loses 40% of it's MSRP of $45,000. In order to equal the net loss on the built GT, your original purchase price for the GT500 would have to have been $59,500.

 

Now, I think this establishes the impirical value of the GT500 at $59,500. Now add to that some intangibles like the fact that it has a full warranty, an extended warranty can be purchased by subsequent owners, it is a legitimate collectors item, it is a limited production car with the name "Shelby" on it.

 

Based on this, I think it can be shown that the current ADM is not as unreasonable as some would suggest.

 

I welcome any different or re-analysis.

Link to comment
Share on other sites

The subject of the value of the ADM has been discussed ad nausium in purely subjective terms (I want it now, it's a "Shelby" etc). I did some research and figuring because 1) I'm a nerd, and 2) I think the issue desrves to have some hard numbers applied to it.

 

I'll start with the basic premise that the GT500 is a 550 hp car because with a few very inexpensive mods it is and in that configuration your warranty is still intact. I'll also assume that the buyer wants a Mustang with 550 hp and excellent handling and ride, and the buyer isn't his own mechanic.

 

You are now left with the choice of building a Mustang GT to that level or buying the GT500. In order to build a Mustang GT to equal the performance of the GT500, the following mods need to be done: CAI, high output intercooled SC, full stainless exhaust with long tube headers, handling pack, hurst shifter, high perf clutch, gauges, forged internals (to maintain reliability), pulleys, full custom tune on dyno, a decent set of wheels and tires, and of course racing stripes (gotta have 'em). Include professional installation/labor. On a typical Mustang GT, you're looking at about a $50k total investment (and this doesn't even include a 6-speed tranny).

 

Three years later, that Mustang won't be worth too much more than a bone stock car. Think about it, "race" cars depreciate worse than stock cars so you'll see little to no return on your investment with few exceptions. Anyone that's tried to sell one knows this. But assume that in three years the car is worth 60% of the original MSRP of $29k, or $17,400. Thus, your net loss is $32,600.

 

Let's assume the GT500 also loses 40% of it's MSRP of $45,000. In order to equal the net loss on the built GT, your original purchase price for the GT500 would have to have been $59,500.

 

Now, I think this establishes the impirical value of the GT500 at $59,500. Now add to that some intangibles like the fact that it has a full warranty, an extended warranty can be purchased by subsequent owners, it is a legitimate collectors item, it is a limited production car with the name "Shelby" on it.

 

Based on this, I think it can be shown that the current ADM is not as unreasonable as some would suggest.

 

I welcome any different or re-analysis.

 

 

 

Nice try on the rationalization, any thing to keep those ADM's up. :nonono:

Link to comment
Share on other sites

Three words explain this perfectly.......................................................................................................................................................................................

 

SUPPLY AND

DEMAND.

 

 

I have three words also...THE BIG PICTURE! = a few $ on ADM's and thousands lost on future business due to WORD OF MOUTH!!! Most successful business models operate on referrals...enough said.

Link to comment
Share on other sites

The bottom line is either you have favours owed by a Ford Dealer or your going to pay the ADM to own one today. I have never payed over for any car but this one may be the one. The 08's may get down to MSRP, but if they don't then I wasted alot of time waiting for something that never happened, if I buy now then if they come down in price I will live with it. I would be careful modding your GT500 it could cause trouble with your warranty. There's a guy on the Z06 Forum who put Scags Shift elimanator on his 06 Z06 and when the Tranny had trouble Chevy Voided the warranty on the whole drive train because he installed a $30 part.

Link to comment
Share on other sites

The subject of the value of the ADM has been discussed ad nausium in purely subjective terms (I want it now, it's a "Shelby" etc). I did some research and figuring because 1) I'm a nerd, and 2) I think the issue desrves to have some hard numbers applied to it.

 

I'll start with the basic premise that the GT500 is a 550 hp car because with a few very inexpensive mods it is and in that configuration your warranty is still intact. I'll also assume that the buyer wants a Mustang with 550 hp and excellent handling and ride, and the buyer isn't his own mechanic.

 

You are now left with the choice of building a Mustang GT to that level or buying the GT500. In order to build a Mustang GT to equal the performance of the GT500, the following mods need to be done: CAI, high output intercooled SC, full stainless exhaust with long tube headers, handling pack, hurst shifter, high perf clutch, gauges, forged internals (to maintain reliability), pulleys, full custom tune on dyno, a decent set of wheels and tires, and of course racing stripes (gotta have 'em). Include professional installation/labor. On a typical Mustang GT, you're looking at about a $50k total investment (and this doesn't even include a 6-speed tranny).

 

Three years later, that Mustang won't be worth too much more than a bone stock car. Think about it, "race" cars depreciate worse than stock cars so you'll see little to no return on your investment with few exceptions. Anyone that's tried to sell one knows this. But assume that in three years the car is worth 60% of the original MSRP of $29k, or $17,400. Thus, your net loss is $32,600.

 

Let's assume the GT500 also loses 40% of it's MSRP of $45,000. In order to equal the net loss on the built GT, your original purchase price for the GT500 would have to have been $59,500.

 

Now, I think this establishes the impirical value of the GT500 at $59,500. Now add to that some intangibles like the fact that it has a full warranty, an extended warranty can be purchased by subsequent owners, it is a legitimate collectors item, it is a limited production car with the name "Shelby" on it.

 

Based on this, I think it can be shown that the current ADM is not as unreasonable as some would suggest.

 

I welcome any different or re-analysis.

 

 

I Have no problem with ADM's... Hell, I paid one!

 

I DO have a problem with Dealerships that LIE to get higher ADM

Link to comment
Share on other sites

I Have no problem with ADM's... Hell, I paid one!

 

I DO have a problem with Dealerships that LIE to get higher ADM

 

 

 

+1 and mis-informed or not informed is no excuse they should know their product...especially if it is the only one they are able to sell at this type of profit margin. The only thin as bad...or maybe worse is those dealers backing out of deals they made to then sell at a higher adm.

Link to comment
Share on other sites

Interesting thread.... although I don't feel that paying more then MSPR is a good idea, I can appreciate your thinking here.

 

Here's how I'd build my GT500+

 

First I'd buy a GT for about 26-28k. Then I'd get the crate motor from Kar Kraft for about 15k: http://karkraft.com/new_engines.htm. The motor would be delivered to the shop to install. I'm fairly certain you could find a shop that would trade you stright up labor for your stock 3V 4.6, or 4.6+some cash. At this point we're roughly at MRSP of the GT500. Brake and suspension upgrades would cost you under 5k w/labor, and you'd have a MUCH better package then the stock GT500 parts. So, I think you could have your car built for between 40-50k.

 

You could probably save around 5k if you went with a Navi 5.4 block, forged internals and a Vortec or Pro-Charger set-up and blow the doors off of any GT500 or Z06 that came your way.

 

Of course these options wouldn't have a factory warrenty - which IMO is just about priceless.

Link to comment
Share on other sites

Interesting thread.... although I don't feel that paying more then MSPR is a good idea, I can appreciate your thinking here.

 

Here's how I'd build my GT500+

 

First I'd buy a GT for about 26-28k. Then I'd get the crate motor from Kar Kraft for about 15k: http://karkraft.com/new_engines.htm. The motor would be delivered to the shop to install. I'm fairly certain you could find a shop that would trade you stright up labor for your stock 3V 4.6, or 4.6+some cash. At this point we're roughly at MRSP of the GT500. Brake and suspension upgrades would cost you under 5k w/labor, and you'd have a MUCH better package then the stock GT500 parts. So, I think you could have your car built for between 40-50k.

 

You could probably save around 5k if you went with a Navi 5.4 block, forged internals and a Vortec or Pro-Charger set-up and blow the doors off of any GT500 or Z06 that came your way.

 

Of course these options wouldn't have a factory warrenty - which IMO is just about priceless.

 

 

:doh:

Link to comment
Share on other sites

Besides the obvious of dealer lies, greed and way out of line ADM's, I think part of the problem is that some of these ADM's are pricing otherwise diehard mustang fans out of the market. Supply and demand is all great and dandy, but when Ford said that they would build one for everyone that wanted one, it gave a lot of people hope that they could get one. Charging 20+ grand over MSRP is crazy when your talking about 50% of MSRP.

 

Those that can afford it, good for you. Not bashing you at all. It just sucks for the people that want one and can't afford the extra ADM.

Link to comment
Share on other sites

Besides the obvious of dealer lies, greed and way out of line ADM's, I think part of the problem is that some of these ADM's are pricing otherwise diehard mustang fans out of the market. Supply and demand is all great and dandy, but when Ford said that they would build one for everyone that wanted one, it gave a lot of people hope that they could get one. Charging 20+ grand over MSRP is crazy when your talking about 50% of MSRP.

 

Those that can afford it, good for you. Not bashing you at all. It just sucks for the people that want one and can't afford the extra ADM.

 

 

I agree with you.

CC

Link to comment
Share on other sites

Rat is right on.

 

In addition to his well thought out logic, a good big-block Mustang, say a '69 428SCJ -'R' is now $70-$100K. For those of us who are not mechanics thats alot of dough for a classic that cannot (or should not) be driven hard. With the GT500 we get todays quality with factory warranty and a car that can be driven hard.

Link to comment
Share on other sites

Archived

This topic is now archived and is closed to further replies.

×
×
  • Create New...
...