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Letter to Ford regarding “value added adjustment”


cobraracing

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I for one would not have even tried to jew the dealer down on price (even if they had 20 of them) if the car was selling at or near MSRP.

 

Ouch!! I thought you had a good reply going until I came across this line....WTF is up with that??? Do you have any idea how offensive that is? Maybe you should!!

 

Sorry I didn't mean it like that.... I guess I have a bad habit of using that term for lack of a better one, I'm not prejudice and I hope nobody takes it that way.

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Well the way I see this example is that if they wont let you bring in your own coolers and beverages then they are strong arming you for the 6.00 beer and I call this legalized extortion at it's finest!

 

"STRONG ARMING" I havn't heard that term in a while but thats a good way to look at it. So, how much do they over charge for a beer when the pro bowl is in town?

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QUOTE(Five Oh B @ Feb 17 2007, 07:36 PM) 102702[/snapback]
I totally agree! Ford should make dealers sell all vehicles at MSRP - no ADM's and certainly no discounts below MSRP either! Go to a one price philosophy, where you win customers with great products and service - not pricing (ADM's, or discounts for that matter).

 

I can tell you that as a dealer, I would totally favor a mandate that we sell everything at MSRP. Heck, we'd make a lot more money that way. Sure, we wouldn't make as much on a handful of GT500's, but we'd rake it in on the hundreds of mainstream vehicles we sell each year like Focus, Taurus, F-150's, Explorers, Fusions, Five Hundreds, Freestyles, Expeditions, Super Duties, Rangers, Edges, Econolines, Sport Tracs, etc. that customers expect to pay invoice or less on currently. So again, make 'em all MSRP!

Five Oh, I'd like your thoughts on a few things.

 

1) Saturn I think already does this, right? Do you have any sense of how this works for them?

 

2) If they went to an "MSRP only" price, how would Ford move slow-selling vehicles? Special financing deals on certain models only?

 

3) Do you consider rebates as "selling under MSRP"?

 

I just think part of the reason they allow the "haggling" is that it gives dealers flexibility to move certain models,etc....and wondering how the dealers (like yours) would see this.

 

Thanks for your thoughts.

 

Dave

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Adm's will not make or break the dealer. If you really look at the big picture 30k worth of ADM on two GT500's is not much in relation to the big picture. My beef on the ADM's is that I will buy 1-2 Ford vans per year and if a dealer had given me MSRP, it would have definitely built loyalty with me. As it stands, i'll buy from whoever pimps the lowest. The ADM's just alienate a lot of customers. I understand five oh's point but the dealers have lead us to believe and proven it time and again that if you pay full MSRP you are probably naive. A dealer in our area tried the "no haggling" "one price" idea, but it didn't work. Is it right that a naive old lady pays sticker and a savvy business man comes in and get $5k off?

I think the key in the "no haggle" pricing is that the car company (Ford, in this case) would need to set it's MSRP prices slightly lower across the board to make this work. The reason is that so many people pay less than MSRP for the mainstream cars, that if they didn't do this...buyers would go to GM or Pentastar.

 

Ford would basically look at what is paid, on average, across an entire year, all models, and see what the average amount paid is relative to MSRP. Let's say that average is 4% below. Then they would, IMO, have to adjust all their MSRPs down by about that much, then implement the no-haggle idea.

 

The one thing I don't like about going to an all-MSRP prices is that it doesn't give informed consumers an advantage. I kinda like the idea that if I'm willing to do more research, learn which cars are slow-moving, and so on...that I can negotiate a better price. On the flip side, I hate the haggle tactics of some dealers...all the "let me go make this offer to our sales manager and see what he/she thinks" or "Yes, we'll sell it to you for that price if you finance through us for 9% over 72 months with a prepayment penalty" or any of those tactics.

 

I guess I can see points on both sides of the equation.

 

Dave

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I think they should fill every order or increase production of the cars, Poeple want them and they all are making money, Who really cares about how much can I can sell it for later??? I buy it now because it fills my needs now. If you have an order fill it, Money in the bank. I think prices would drop like crazy and cool cars would be everywhere, Just my opion.

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I am not in the automotive business. It is wrong and fraudulent when a dealer does not honour a previous written agreement/sales contract.

Those who entered into agreements to buy the new GT500 also took a chance. They put deposits down 1 to 2 years in advance without knowing the MSRP or the market value. They gambled and hopefully most were rewarded with a car. This is a limited edition car and as with such cars the price is often over and above MSRP.

 

Those who are coming late to the dance should not expect to have a Shelby for MSRP. That is absolutely ridiculous. No one is forcing them to buy one. If you want one you must be prepared to buy at the current market value. This value differs from place to place.

 

Ford has more competition than ever before and needs a happy dealer network. Ford may have underpriced the car from the get go and frankly I would sooner have Ford make a larger markup than the dealers. Now here is a unique opportunity for the dealer to make a few extra bucks and I'm sure Ford Motor Co. is happy to provide this excitement.

 

I don't think Ford should intervene except for those situations where their dealers are not honoring their end of a deal.

 

Lets hope Ford turns it around and gets back on top. You know their products are for the most part sold well below MSRP and their rates are the lowest compared to the Japanese.

 

My $.02

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We have a Ford dealer here in Hawaii that sells EVERY NEW VEHICLE that they have at MSRP or less and not a penny more! Even with the huge shipping costs to get the vehicle here they never charge more than MSRP.

 

If they can do it, all Ford dealers can do it and still survive.

 

Yes I have bought new vehicles from them at MSRP or less and it's no not b.s. and no they don't have any GT500's (sorry).

 

The dealership I work for sells every new Ford (except Shelby's) below MSRP everyday. We special order any new 2007 Ford (except Mustangs and Hybrids) for just $99 over invoice total. Mustangs and Hybrids are even special ordered for prices way below MSRP, but a bit higher than $99 over invoice total. We are a one-price store, meaning that we post our rock bottom sale price clearly and proudly on everything. We even post our sale prices at our website for the world to see. It seems to be popular with customers as we've been doing it for nearly 15 years, and we a top 10 volume dealer out of the 150+ dealers in our region. By taking the negotiation out of car buying, and offering prices well below MSRP consistently (again, except Shelby's) we've made our customers extremely happy. We've won 11 President's Awards from Ford (their highest honor for customer service). We are one of only about two dozen dealers nationwide (almost 4,000 dealers out there) who have won as many.

 

So, yes, we survive just fine selling below MSRP on everything. The Shelby situation is unique, though. Yes, we collected ADM's on all of ours, but our ADM turned out to be much lower than most dealers.

 

On a side note, 1badgt500, the shipping cost (D&D) is the same to Hawaii as everywhere else. It's averaged out nationally by Ford and included in the price Hawaiian dealers pay (along with dealers in Alaska, Michigan, etc.).

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I think the key in the "no haggle" pricing is that the car company (Ford, in this case) would need to set it's MSRP prices slightly lower across the board to make this work. The reason is that so many people pay less than MSRP for the mainstream cars, that if they didn't do this...buyers would go to GM or Pentastar.

 

Ford would basically look at what is paid, on average, across an entire year, all models, and see what the average amount paid is relative to MSRP. Let's say that average is 4% below. Then they would, IMO, have to adjust all their MSRPs down by about that much, then implement the no-haggle idea.

 

The one thing I don't like about going to an all-MSRP prices is that it doesn't give informed consumers an advantage. I kinda like the idea that if I'm willing to do more research, learn which cars are slow-moving, and so on...that I can negotiate a better price. On the flip side, I hate the haggle tactics of some dealers...all the "let me go make this offer to our sales manager and see what he/she thinks" or "Yes, we'll sell it to you for that price if you finance through us for 9% over 72 months with a prepayment penalty" or any of those tactics.

 

I guess I can see points on both sides of the equation.

 

Dave

 

MSRP would be the Max Price customers would have to pay, they could always sell them for less if they wanted to but never higher than that. At least that's how it's done at my favorite dealer here.

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I am sure by now Ford has figured out they have made a huge mistake on the GT500. They should of priced the car for 10K to 15K more. They would have sold every car and made alot more money. Because many have been sold for that with the ADM, it must be the true market value. If they moved slow at the higher price, the dealers could have reduced them like they do all other cars.

 

Excellent point, and I truly expect GT500 pricing (MSRP) to increase for the 2008 model year.

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I have also NEVER paid over MSRP for any of the 10 or so new vehicles that I have bought and owned in my lifetime and fully believed Ford when they said that I could get one for about 42-45,000 dollars so that is what I was planning to spend on the car.

 

I would have been much happier though if I could have found one at the price that Ford told us the cars would be selling for but I am by no means regreting buying the car even at that price.

 

Ford never said how much GT500's would sell for. They only suggested that MSRP would be around $40K (even a little less than $40K if you go way back to some of HTT's early quotes). MSRP, by definition, is only a suggested amount by the manufacturer - not a promise of what the market will price it at based on supply and demand.

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QUOTE(Five Oh B @ Feb 18 2007, 11:07 AM) 103052[/snapback]
The dealership I work for sells every new Ford (except Shelby's) below MSRP everyday. We special order any new 2007 Ford (except Mustangs and Hybrids) for just $99 over invoice total. Mustangs and Hybrids are even special ordered for prices way below MSRP, but a bit higher than $99 over invoice total. We are a one-price store, meaning that we post our rock bottom sale price clearly and proudly on everything. We even post our sale prices at our website for the world to see. It seems to be popular with customers as we've been doing it for nearly 15 years, and we a top 10 volume dealer out of the 150+ dealers in our region. By taking the negotiation out of car buying, and offering prices well below MSRP consistently (again, except Shelby's) we've made our customers extremely happy. We've won 11 President's Awards from Ford (their highest honor for customer service). We are one of only about two dozen dealers nationwide (almost 4,000 dealers out there) who have won as many.

 

So, yes, we survive just fine selling below MSRP on everything. The Shelby situation is unique, though. Yes, we collected ADM's on all of ours, but our ADM turned out to be much lower than most dealers.

 

On a side note, 1badgt500, the shipping cost (D&D) is the same to Hawaii as everywhere else. It's averaged out nationally by Ford and included in the price Hawaiian dealers pay (along with dealers in Alaska, Michigan, etc.).

 

Hey nice to have confirmation that these kind of dealers do exist and do make a living selling cars at or below MSRP. Too bad they can't get Shelbys just yet... maybe soon!

 

Thanks for explaining the shipping costs too, I didn't know how they did that but I do know that my car had a 750.00 destination charge tacked on.

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I try to keep things simple.

 

If Ford doesn't make any money off of ADM's, why wouldn't they ramp up GT500 production and sell more of them? ("We'll produce enough for everyone to have one!")

 

If you have a product that is in demand - PRODUCE IT.

 

Sorry.

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Anyone that had a contract with a dealer for an 07 GT500 that had the contract ripped out from under them, i believe you have a reason to gripe. If you had that in writing on a legal piece of paper then its pretty f$%ked up if a dealership didnt honor that and i hope you take some sort of legal action against them. However for everyone else, the way dealers sell these cars is just an example of one of the freedoms this country allows us. And i know another one of the great freedoms we have is freedom of speach and expression so i encourage you to keep using your freedoms cause they are what our service men and women fight for and i know we all thank them for that, i know i do. However to expect ford to mandate an MSRP goes against this countries idea of a free market economy and a company's (wether large or small) rights to charge what they deem exceptable. And i know i said this before but your only going to pay what the car is worth to you. The people who have decided to pay an ADM for an 07 model did so cause the car was worth 60-70 thousand to them. If you are just shopping around for one and dont have a contract with a dealer for an MSRP and you wont pay over 50,000 for the car then it isnt worth as much to you as you think it is. (again i dont mean to offend anyone)

 

Edit: thanks for that info on the shipping Five Oh B, i had always wondered if places like hawiaii or alaska had to pay extra shipping costs. Thank you for enlightening me.

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QUOTE(Five Oh B @ Feb 18 2007, 11:18 AM) 103058[/snapback]
Ford never said how much GT500's would sell for. They only suggested that MSRP would be around $40K (even a little less than $40K if you go way back to some of HTT's early quotes). MSRP, by definition, is only a suggested amount by the manufacturer - not a promise of what the market will price it at based on supply and demand.

 

Yea they said around 40 initially and then when they posted the real MSRP (45,000 for the shaker 1000 and interior u[pgrade) on their site I fell vicitm to thinking that I could just go down to the dealer and order one at that price.

 

Looking back now I should have known better I guess but I never had that problem before when I special ordered 2 Buick Regal Grand Nationals at MSRP from a dealer in Honolulu (15,000 for the '85 and 17,000 for the '87) and they were in HIGH demand here in Hawaii at that time (+short supply) and I had lots of people trying to buy them out from under me but I didn't get gouged so I didn't yet experience the 15,000 over MSRP thing until now.

 

Now I too have become a vicitm!

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I think the key in the "no haggle" pricing is that the car company (Ford, in this case) would need to set it's MSRP prices slightly lower across the board to make this work. The reason is that so many people pay less than MSRP for the mainstream cars, that if they didn't do this...buyers would go to GM or Pentastar.

 

Ford would basically look at what is paid, on average, across an entire year, all models, and see what the average amount paid is relative to MSRP. Let's say that average is 4% below. Then they would, IMO, have to adjust all their MSRPs down by about that much, then implement the no-haggle idea.

 

Dave

 

Dave, Ford has actually been working toward this for the last few years. While they still can't mandate how much dealers sell stuff for, they have been squeazing the dealers by reducing the gap between our cost (invoice total) and MSRP. Their reasoning is that they are trying to hold MSRP down closer to real transaction amounts. Just a few years ago, there was $4K to $5K between invoice and MSRP on SUV's and trucks, while now these types of vehicles have a margin of $1K to $2K. This way Ford looks good to customers (keep MSRP stable, or even lower it from year to year), but it is pinching the dealers tighter and tighter.

 

When Ford offered the Family Plan pricing a couple summers ago, business boomed. We sold record numbers of vehicles here (as did most Ford dealers). This only reinforces that most customer prefer that a price be set (especially at a huge perceived discount that is available to all, not just the best negotiaters).

 

Saturn has been one-price since its inception, but their failure has been in offering bland cars at best. The one-price thing works well once it is fine tuned. The dealership I work for is one-price, but we have to be sure that our sale price is super competitive to what customers can negotiate down to elsewhere. That's why everything (except Shelby's) are priced below MSRP here. And, if we have a rig that's been around way too long, we whack the price down below invoice (sometimes way below invoice) and lose money to get it gone. That way, anyone can come in, get that awesome loss-leader price, and we move the rig that we wanted out of here the most. Give your stuff away too cheap, however, and you leave money on the table that could have been easy to earn at a traditional store that negotiates. Again, it requires a lot of fine tuning!

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I try to keep things simple.

 

If Ford doesn't make any money off of ADM's, why wouldn't they ramp up GT500 production and sell more of them? ("We'll produce enough for everyone to have one!")

 

If you have a product that is in demand - PRODUCE IT.

 

Sorry.

 

That's right.... mass produce them right now, just like the TV's, DVD Players, Washers and Dryers etc... (as has been compared previously in this thread)

 

If you don't get going on it immediately you will lose many, many potential sales to other manufacturers who will see the opportuinty and seize it! (Ford doesn't seem to give a damn)

 

After all, with the new Challenger and Camaro coming back on board I'm sure there will be many new car customers that will end up buying another brand because Ford didn't make enough of the GT500's to bring the prices down to Earth as fast as possible.

 

We'll see where the ADM's are on these other cars but I can't see all three muscle cars going for 10-30,000 over MSRP, at least not for ever.

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That's right.... mass produce them right now, just like the TV's, DVD Players, Washers and Dryers etc... (as has been compared previously in this thread)

 

If you don't get going on it immediately you will lose many, many potential sales to other manufacturers who will see the opportuinty and seize it! (Ford doesn't seem to give a damn)

 

Ford does give a damn, but increasing production on a specialty car is not as easy as you would like it to be. There are vendor commitments to be made months in advance, and government restrictions (CAFE ratings most of all) that keep gas-guzzler production at bay. But, more importantly, Ford has some REAL experience in building specialty cars that didn't sell as well as hoped in recent memory that is likely keeping them from overproducing GT500's. Allow me to share some #'s with you to help illustrate....

 

1999 Mustang 35th Anniversary GT. Ford said they would build 6,000, but only 4,628 were actually sold!!!

2000 Mustang Spring Feature GT. Ford said they would build 6,000, but only 3,901 were actually sold!!!

2001 Mustang Bullitt GT. Ford said they would build 6,000, but only 5,582 were actually sold!!!

2002 Thunderbird (retro style 2 seater). Ford expected to sell 25,000 per year, but fewer than 18,000 were sold and each subsequent year got worse.

2003 Mustang Mach 1. Ford said they would build 6,500, but demand forced almost 10,000 to be built and sold. Plus, Ford added a second year of Mach 1 production for 7,000 more built and sold.

2004 SVT Cobra. After a better than expected 2003 SVT Cobra model year, the 2004's tanked. Roughly 4,000 built and sold (most sold with huge rebates to unload them!).

 

So, in looking at six years of specialty products, can you understand how Ford may be a little gunshy to overproduce GT500's, Shelby GT's, etc.?????

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QUOTE(Five Oh B @ Feb 18 2007, 05:02 PM) 103071[/snapback]
Ford does give a damn, but increasing production on a specialty car is not as easy as you would like it to be. There are vendor commitments to be made months in advance, and government restrictions (CAFE ratings most of all) that keep gas-guzzler production at bay. But, more importantly, Ford has some REAL experience in building specialty cars that didn't sell as well as hoped in recent memory that is likely keeping them from overproducing GT500's. Allow me to share some #'s with you to help illustrate....

 

1999 Mustang 35th Anniversary GT. Ford said they would build 6,000, but only 4,628 were actually sold!!!

2000 Mustang Spring Feature GT. Ford said they would build 6,000, but only 3,901 were actually sold!!!

2001 Mustang Bullitt GT. Ford said they would build 6,000, but only 5,582 were actually sold!!!

2002 Thunderbird (retro style 2 seater). Ford expected to sell 25,000 per year, but fewer than 18,000 were sold and each subsequent year got worse.

2003 Mustang Mach 1. Ford said they would build 6,500, but demand forced almost 10,000 to be built and sold. Plus, Ford added a second year of Mach 1 production for 7,000 more built and sold.

2004 SVT Cobra. After a better than expected 2003 SVT Cobra model year, the 2004's tanked. Roughly 4,000 built and sold (most sold with huge rebates to unload them!).

 

So, in looking at six years of specialty products, can you understand how Ford may be a little gunshy to overproduce GT500's, Shelby GT's, etc.?????

 

very good info

But on the 02 T-birds, I think they only sold that many because the dealers were trying to get $5-10k over MSRP in most areas. Not nearly the demand as the 500 but they could have sold alot more at MSRP.

 

The 04 cobra were a great car for the money ! A great bargain

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Five Oh B

 

Looking at Fords price per vehicle, dont you think that Ford may actually be LOSING money on the GT500 just to have it as a Halo car? Its common knowledge that every Focus that Ford sells actually costs them money, but they count on other vehicles (Expeditions, Explorers etc.) to help them make money and use the "losers" to boost brand awareness and show total increases in sales volume as a Manufacturer. I wonder if they're actually making money on this car with all of the special pieces that are unique to the platform.

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Bless you 5.0B...

 

this is at least the 1,653rd time you've explained all this over the past couple of years...

 

bless you... bless you...

 

:idea:

 

Maybe we need a sticky thread that says:

 

-Before you bitch about Shelby prices read this:

-Shelby price is contractually set by dealer: yeah, that sucks, but it works both ways ...like deep discounts on SUVs.

-No, Ford doesn't make one cent extra on your Shelby, regardles of what the dealer charges.

-Yes, more production would solve the Shelby ADM problem but there are little bumps in that road, like supplier contracts and CAFE commitments. Besides, where was that crystal ball two years ago?

-Actually, neither Ford nor the dealer set the price. ...YOU DO! If you feel it's too high, don't buy the car and it will be lower.

-Ford is just as sorry as you are about Shelby pricing. Had they known you wanted one they would have planned for it -- too late now.

-Yes, Ford can extend production until "everyone who wants one gets one" as they've said they will -- assumng they can extend supply contracts and stuff enough unwanted V6s up enough dealer's butts (to meet CAFE)... so just wait till the prices come down -- what's your hurry? Oh, you want one now? The price is higher right now because there are 20,000 others who want one now too! patience is a virtue. Petulance costs.

Yes, Ford still loves you -- others may not, but Ford does!

and ...no ...I will not shove that up my a$$ -- I spent all day Zainoing it!!!!

 

<ok, let's recycle this in 2 months when the subject comes up again, ok?

 

in the meantime, ...god bless you 5.0B ..and thanks for all you have educated, all you have patiently guided, and all those to whom you will invariably re-explain the dynamics of the American way of life for the 1,654th time ...in a few months.

 

I've given up explaining it any more... I'll just wait until prices come down -- or the Boss is done right -- or.... :boring:

 

.

 

<edit: just kidding, everyone... sheesh! ;-)>

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I sit on both sides of the fence on this issue. As a business owner I understand that if someone is willing to pay me 15-25% more for any given service I will happily take it. However, here's my situation.

 

My dealer was incrediably fair with me. So much that I agreed not to disclose to anyone what I paid. I was at the Toronto Auto Show today as my F150 comes off lease in August and my wife's car shortly afterwards. As for my truck it's a given I'm going with another Crew F150, for my wifes car we were leaning towards the Edge. Today at the show we sat in a Mercedes C280. It's the entry level Benz and I was blown away by what you get for 43,000 CDN (and that's list) and since it's the wife's car I really don't care what she wants to drive as long as it fits the budget.

 

Now, here's where my morals kick in. I think the Benz is a better deal than the Edge and I think the resale will also be better but I find myself leaning towards the Edge simply out of loyalty. He treated me fair and acknowledged that my name was inked for a Shelby in May 05 and yada yada and he pretty much has me as a customer for a long time.

 

So there's the other side of the coin. He could've jacked me on the Shelby and didn't and I will probably go with the Edge as a result. Factor in the F150 and the two make up more than any ADM I would've been able to pay.

 

Cobra, I thought you had a deal on a Shelby already. At least this is what one of my buddies that works at the yard with you told me. Good luck either way.

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QUOTE(Five Oh B @ Feb 17 2007, 08:22 PM) 102759[/snapback]
Yeah, I know, we're beating a dead horse, but it always amazes me that some people want only what's in their best interest, even if it means being a bit hypocritical. If someone really believes that Ford should make dealers charge MSRP for a GT500, then they should also embrace paying MSRP for everything else. Instead, consumers want to gouge the dealers down to invoice or lower on their new SUV's and trucks, but they don't want to be gouged in return on a hot product like a Shelby.

 

cobraracing, I do really feel bad about the ADM's on GT500's. Heck, if it weren't for the dang ADM's and limited supply, I'd have bought a GT500 by now! Instead, those with the means and connections have been able to buy them leaving me with the option of waiting forever, or buying a different Mustang model (which I ended up doing). Ford really is constrained legally by the franchise laws with their dealer body. It may not be the perfect system, but it is the same system other manufacturers - not just Ford! - use as well.

 

This topic will continue to pop up from time to time from here to eternity. I've really got to refrain from chiming in on it each and everytime I read it anew again.

 

And, BoneDoc, I like you too. I like everyone here. You guys have kept me very informed over the last year and a half, and hopefully, I've had some insights to offer in return once in awhile.

 

I totally agree with you. By the way I payed an ADM and also had a problem with a dealer who breached our contract on the first try to purchase...I'm still in the process of dealing with that situation.

But here's my read on this whole ADM situation. Do you remember when Mark Fields and Carroll drove up in the red Shelby upon it's release and announced that the car would be a high powered vehicle that the average person could afford and that it would be in the low to mid $40,000.00 range.

I really think that this set up everyones expectations regarding pricing...so I think Ford had a little to do with this anger over the current pricing.

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"But here's my read on this whole ADM situation. Do you remember when Mark Fields and Carroll drove up in the red Shelby upon it's release and announced that the car would be a high powered vehicle that the average person could afford and that it would be in the low to mid $40,000.00 range.

I really think that this set up everyones expectations regarding pricing...so I think Ford had a little to do with this anger over the current pricing. "

 

Good point!

 

I paid 5k over MSRP. I said I never would, but it was that or probably no Shelby. I haven't complained about it that much on this forum, but Lord knows I wish I had that 5k for mods. If someone wants to let off a little steam about ADMs, then I say go for it. If you are tired of these rants--don't read them.

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Isn't this similar to when a new Sony Playstation comes out? Sony announces date and MSRP. Certainly no one expects them to go for MSRP on e-bay at first. Eventually, you can get them in any store for MSRP.

 

I too despise the whole ADM thing -- in fact I will not buy a car, any car ever, for more than MSRP (not one cent more). In fact, I've never paid more than a few hundred over dealer cost -- including the '01 Cobra which was selling for 5K over for months on end when it first came out because there was so much pent-up demand because there was no '00Cobra because the '99 had the intake problems that made it miss its HP target by a little.

 

Apparently the whole mystique of the Shelby name on this wonderfull SVT Cobra has made for an extended ADM 'season' but ask yourself this: have you ever seen any American-made car that still had ADMs on it and the manufacturer stopped producing? Not the Vette, not the Viper, not anything from Ford -- even the FordGT can be had for MSRP. Add to that the fact that several Ford executives have stated in print, in interviews, and to car rags that they will make these cars until 'everyone who wants one can buy one.'

 

Initially there was rumored (likely factual) Tremec production limitations, but Tremec has stepped-up TR6060 production capacity (plant expansion) since the new 'Vette and Viper will BOTH get the 6060 -- the GT500 exclusive was only for 1 year, I believe, since capacity was limited and Ford needed every one they could produce. Ford worked closely with Tremec on the spec/design and got the exclusive.

 

So, now, I think we should all pray that there are at least 4 people you see on the streets who yearn for a Mustang V6, because it would seem that CAFE is now the only known [to me, anyway] remaiing production limiter on the GT500. From what I understand, Ford's plant instructions (not sure what it was called, but was posted on another forum by a Ford insider) on the Mustang is: V6 - a minimum of 39% of production; GT - a maximum of 51% of production; GT500 - "is set at 10% of production."

 

I don't know the 'Ford' meaning of "is set at" (as opposed to 'max' and 'min') but that says to me (just me, I don't work for Ford) is that there will need to be about 4 V6s produced to permit (my read) one GT500 as long as GTs are no more than half the run. Possibly [likely?] that's a CAFE plant-mix instruction -- dunno. If that's the case, and based on approximate Mustang production, Ford could produce over 12,000 GT500s and stay within that ...if there are no other supplier constraints and plenty of V6 buyers (<--there aren't... the dealers are force-fed V6s ..problem?).

 

Which brings up the next (former?) constraint: the Eaton Rootes s/c. This was believed to be a constraint early-on and Eaton has since supplied the aftermarket with quite a few variations/derivatives for the 4.6 GT and others (Roush? Saleen? Steeda? dunno who uses which specific Rootes on their 4.6 Mustang builds and kits). So possibly the 5.4 Eaton Rootes could still be a supply problem, but I kinda doubt that at this point, especially since there is talk that Eaton has since improved their Rootes s/c design/machining with tighter tolerances and some other heat-soak reduction improvements and there are rumors those will be sold as aftermarket and/or on a upgraded/specialty version of the GT500 (2008? KR? dunno, that's why I say rumors, but the talk of the improved Rootes product itself has some credibility, I think).

 

Ford sure can't go back and make more in '06, but they possibly could have ramped production up for job-2 (don't think they did) or maybe for MY'08, or extend production into MY'09 or both (or neither ...hope not).

 

What I'd really like to know (if anyone has any insight), is how much Ford (not Mazda) contractual capacity is available at AAI Flat Rock for Mustang and what the more recent production volumes have been, since that could be a constraint too. Also, if Mazda buys Ford's share of Flat Rock (which they expressed interest in doing some time ago) Mustang will move elsewhere -- a likely scenario anyway for the '09/'10 refresh? or MY'12 fresh-sheet?

 

Cartainly, any substantial production increase will take the edge off ADMs on these cars somewhat, but the pent-up demand will still likely keep ADMs [unfortunately] in our future for some time yet.

 

Yet, eventually, I feel good about the ADMs dropping a bunch and eventually going away, or better. Ford would be foolish, imo, to stop making any car while still under dealer ADM -- doesn't make sense for Ford; doesn't make sense for the customer; DOES make sense for the dealer, which is why I think the whole e-bay game is in full swing -- to keep the apparency of the market price high. What I mean by 'apparency' is that e-bay is actually a 'national peak price' not a true 'market' price.

 

I have personally gone to 6 Ford dealers in rural NY and CT and have found only 2 dealers demanding over 5K and both of those were transferring to an e-bay Ford dealer (one for $10K over) . Unfortunately, the $5K-over units for the others are long-committed (and most have already shipped) to a long list of waiting customers. Even our local dealer here in upstate NY has (and is) selling every GT500 at $5K over (don't bother, there were over 30 deposit contracts as of August of last year!) ...but at least their pricing is upfront and honest -- like the approach 5.0B has taken).

 

My feeling is that patience will pay off -- even if I don't buy a GT500 (I could have had the first one locally but will not pay one cent over MSRP) there'll be the Bullitt (booo on the iron 5.4) and the Boss (please, oh please -- alloy DOHC 5.0 or greater, modular or H/Boss, now or later, just do it Ford... pleeeeease ;-)

 

:baby:

 

-Dan

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Here is a letter I wrote to Ford and their response

 

I have been trying to purchase a 2007 Mustang Shelby from the local dealers as well as across Canada and have met much resistance from them when offering to purchase it at MSRP. The dealers want from $15,000 - $30,000 over what Ford has suggested.

 

I have been awaiting the car for over 2 years and am now dismayed over the prospect of paying this "value added adjustment"

 

It seems that it is just that a "suggested price" due to the greed a lot of dealers have shown.

 

I have mostly owned Fords throughout my life and have owned over 20 Mustangs but have been turned off by the devil-may-care attitude towards their customers.

 

Most high performance specialty buyers wont own just one vehicle and Ford should be concentrating on not only customer retention but attracting off-brand purchasers to buy domestic and specifically Ford.

 

Is there a way for Ford to supply the car at the price they suggest?

 

I am ready to purchase and will await your response

 

---------------------------------------------------------------------------------------------------------------------------------

 

 

 

Thank you for contacting the Ford of Canada Customer Relationship Centre. We received your message sent on 2/5/2007 regarding the dealership's pricing for the 2007 SVT Mustang Shelby GT 500.

 

We thank you for taking the time to let us know about your frustration with your dealership increasing the price for the 2007 SVT Mustang Shelby GT 500. Feedback such as yours allows us to examine our practices and policies to ensure that we meet or exceed the expectations of our customers. We regret that we have not been able to satisfy you on this occasion, but your concerns have been documented for future reference.

 

Ford of Canada is only able to provide the Manufacturer's Suggested Retail Price (MSRP) for a new Ford or Lincoln Mercury vehicle.

 

Please note that our dealerships are independently owned and operated and therefore may set their own pricing strategies. We regret to inform you that we are unable to intervene in pricing issues since the dealerships are governed by Franchising and Contractual Laws.

 

we apologize for any frustration you may have experienced as a result of this situation.

 

Thank you for expressing interest in our vehicles. We wish you many years of safe and enjoyable motoring.

 

If you have any other inquiries or concerns, please feel free to contact us and we will be happy to address them.

 

Thank you for contacting Ford of Canada.

 

Sincerely,

 

Ford of Canada

Customer Relationship Centre

 

Looks like some fancy dancing to me....... :banana piano: :happy feet:

I don't think Ford is seeing the Big Picture, and that is why you will see so many Toyota's sitting in the driveway of GT500 owners. They act like the GT500 is the last car they will ever need to sell.

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Bless you 5.0B...

 

this is at least the 1,653rd time you've explained all this over the past couple of years...

 

bless you... bless you...

 

:idea:

 

Maybe we need a sticky thread that says:

 

-Before you bitch about Shelby prices read this:

-Shelby price is contractually set by dealer: yeah, that sucks, but it works both ways ...like deep discounts on SUVs.

-No, Ford doesn't make one cent extra on your Shelby, regardles of what the dealer charges.

-Yes, more production would solve the Shelby ADM problem but there are little bumps in that road, like supplier contracts and CAFE commitments. Besides, where was that crystal ball two years ago?

-Actually, neither Ford nor the dealer set the price. ...YOU DO! If you feel it's too high, don't buy the car and it will be lower.

-Ford is just as sorry as you are about Shelby pricing. Had they known you wanted one they would have planned for it -- too late now.

-Yes, Ford can extend production until "everyone who wants one gets one" as they've said they will -- assumng they can extend supply contracts and stuff enough unwanted V6s up enough dealer's butts (to meet CAFE)... so just wait till the prices come down -- what's your hurry? Oh, you want one now? The price is higher right now because there are 20,000 others who want one now too! patience is a virtue. Petulance costs.

Yes, Ford still loves you -- others may not, but Ford does!

and ...no ...I will not shove that up my a$$ -- I spent all day Zainoing it!!!!

 

<ok, let's recycle this in 2 months when the subject comes up again, ok?

 

in the meantime, ...god bless you 5.0B ..and thanks for all you have educated, all you have patiently guided, and all those to whom you will invariably re-explain the dynamics of the American way of life for the 1,654th time ...in a few months.

 

I've given up explaining it any more... I'll just wait until prices come down -- or the Boss is done right -- or.... :boring:

 

.

 

<edit: just kidding, everyone... sheesh! ;-)>

 

Damn, I laughed really hard reading your post! Thanks for being so brave to summarize what everyone should know about GT500 ADM's at this point in time. You da man, 68fastback!

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Five Oh B

 

Looking at Fords price per vehicle, dont you think that Ford may actually be LOSING money on the GT500 just to have it as a Halo car? Its common knowledge that every Focus that Ford sells actually costs them money, but they count on other vehicles (Expeditions, Explorers etc.) to help them make money and use the "losers" to boost brand awareness and show total increases in sales volume as a Manufacturer. I wonder if they're actually making money on this car with all of the special pieces that are unique to the platform.

 

I'd like to think that Ford is making money on the GT500 right now, or at least they will by the time all 18,000 or so are sold over the two year run. If they make a third year, then the scales of economy should be there to turn a profit on their "halo" car.

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...and it's hard to get those camry's -- RUF had to crash his stang to get one <just kiddin' RUFster>

 

Truth is Ford cannot set sales price, only MSRP -- it's in the franchise contract and they are not going to change anytine in the near future and certainly not for a single-model problem. ADMs suck, but contracts are contracts. Ford has blocked dealers from using resellers (for just the GT500) because that is something the contract permits them to control. So the dealers now trans-ship to other legit Ford dealers that are geared-up for e-bay -- having the same apparent efect, but legit under the contract.

 

The contract is what does and will guide the relationship. Certainly Ford does not like ADMs -- it pisses off potential customers and likely affects future sales.

 

Even if it was feasable to renego the franchise agreement, setting the MSRP as THE sale price would make it impossible to force-feed the dealers all the other models at model-year-end without the offering huge factory deals or bankrupting many dealers.

 

ADMs suck but only time, production levels, and customers refusing to buy the car at elevated prices, can fix that. I'm doing my part... I WILL NOT buy one for one cent over MSRP -- never have bought for more than a few-hundred over invoice -- including the high-ADM '01 Cobra (which eventually went for $300-over invoice <lol> and no trns-ship fee!).

 

Problem is, even if everyone did the same, the 'gut' demand is still there -- many would have to be willing to literally pass on the car unless prices drop. As more folks walk into dealers and walk out for any price over MSRP, the price wil come down. Eventually when production satiates demand that's what happens for real and the price drops like a stone. Always has. I'll just wait and see.

 

. :baby:

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Bless you 5.0B...

 

this is at least the 1,653rd time you've explained all this over the past couple of years...

 

bless you... bless you...

 

:idea:

 

Maybe we need a sticky thread that says:

 

-Before you bitch about Shelby prices read this:

-Shelby price is contractually set by dealer: yeah, that sucks, but it works both ways ...like deep discounts on SUVs.

-No, Ford doesn't make one cent extra on your Shelby, regardles of what the dealer charges.

-Yes, more production would solve the Shelby ADM problem but there are little bumps in that road, like supplier contracts and CAFE commitments. Besides, where was that crystal ball two years ago?

-Actually, neither Ford nor the dealer set the price. ...YOU DO! If you feel it's too high, don't buy the car and it will be lower.

-Ford is just as sorry as you are about Shelby pricing. Had they known you wanted one they would have planned for it -- too late now.

-Yes, Ford can extend production until "everyone who wants one gets one" as they've said they will -- assumng they can extend supply contracts and stuff enough unwanted V6s up enough dealer's butts (to meet CAFE)... so just wait till the prices come down -- what's your hurry? Oh, you want one now? The price is higher right now because there are 20,000 others who want one now too! patience is a virtue. Petulance costs.

Yes, Ford still loves you -- others may not, but Ford does!

and ...no ...I will not shove that up my a$$ -- I spent all day Zainoing it!!!!

 

<ok, let's recycle this in 2 months when the subject comes up again, ok?

 

in the meantime, ...god bless you 5.0B ..and thanks for all you have educated, all you have patiently guided, and all those to whom you will invariably re-explain the dynamics of the American way of life for the 1,654th time ...in a few months.

 

I've given up explaining it any more... I'll just wait until prices come down -- or the Boss is done right -- or.... :boring:

 

.

 

<edit: just kidding, everyone... sheesh! ;-)>

I could add this to the FAQ I started, and we could refer people there.

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68fastback, you mentioned the commodities restriction on V6/GT/GT500 Mustangs. The percentages have changed a bit throughout the model year, with early GT500 production capped at 5% of total Mustang production, and now at 10% of total Mustang production. And this amount is footnoted at DNE (do not exceed) so we have to order 9 V6 and/or GT's to get 1 GT500. In the 2005 model year, Mustang sold about 165K units I think. For 2006, Ford negotiated a bit more room from Mazda at Flat Rock and made about 190K units??? But, that's it. So, considering that early 2007 GT500's were capped at 5% and now they're at 10% it is conceivable that Ford could build 12K-15K GT500's and still keep the feds happy for CAFE, as you pointed out. That leaves the other constraints out there, though (Eaton, Tremec, etc.).

 

We took a zillion V6's and GT's to ensure that our GT500's were built in a timely fashion. We have over 40 Mustangs (1/2 and 1/2 V6 and GT) here today compared to most neighboring dealers having 5-10 at any given time, but it was worth it to expedite our GT500 customers' orders for them (and us, of course).

 

And, worth noting, fair/upfront pricing at the dealership level is paramount to keep customers happy long term. Our first GT500 customer reinforced our decision to keep our ADM's reasonable by purchasing a new F-150 over the weekend from us (for $58 over invoice, FYI, which is thousands below MSRP). He still loves his GT500 (and his pair of Mach 1's, pair of GT's, etc.) and loved his many purchases with us over the years.

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