Greedy Bastards.....

On Thu, 26 Oct 2006 21:11:51 -0400, Henry wrote something wonderfully witty:

This is only my guess, but I think it is fair to say "as much as they can get". You have to remember that it isn't Ford that is setting the market price, it is the market itself. If that dealer is able to move the one it has at $70k it will try to move the next one it gets at $70k. I don't know how much the dealers are paying for the cars when they but them from Ford, but it is safe to assume somewhere less then sticker price.

On Thu, 26 Oct 2006 21:11:51 -0400, Henry puked:

My dad bought a T-bird the first year that they were reintroduced from a dealership down here for list while others were charging a premium. He was on a list and even custom ordered the seats a single color instead of two colors.

I wonder if there are any dealerships even considering doing that with this car...

-- lab~rat >:-) Do you want polite or do you want sincere?

I don't see why anyone gets upset over the dealers maximizing their profit. You are absolutely right, the buyers set the price, not the dealers. If any one of us had a vintage GT500 we would sell it for the highest price we could get and not a penny lower. Why would we expect the dealer to do any less than us? If Ford makes their stated production numbers then I think the price will fall to around MSRP sometime next year. Right now they are being gobbled up by people that have plenty of money and desire for the car. The same thing happened with the Ford GT and now you can get one for around MSRP. It takes time to weed out the crazies that will pay nearly any price to have the car today.

I am so tired of that saying.... the markets are often manipulated, and the GT500 can be used as a text book study of market manipulation and artificial scarcity.

When each dealer gets one or two, they can up the price a great deal and wait for a sucker, the abberation of an uninformed buyer. Not only that, but it's not like the dealer down the street or the next town over can bring the price down. He's only got a couple to sell too, so even if he sells them at sticker, the first dealer can still wait for a sucker or someone with more money than sense and wants it now.

Ideal free market conditions would have another dealer being able to come in and supply more cars at a lower price to undercut the dealers charging $20K over sticker. Ford controls the supply of cars without regard to what dealers are charging and thusly the market isn't free. $65K isn't the price a free market will bear, but rather the maximum price a manipulated market can be pushed to.

This isn't free market setting the price, it's market manipulation and artificial scarcity in action. The market is being controlled to create conditions that increase prices rather than the ideal free market setting of the price.

Because it's a manipulated market. It's the same reason $3+ a gallon gasoline gets people upset. It's a manipulated market where others can't come in and undercut the competition.

Let's say instead of dealer alotments, ford had open ordering until they ran out of the limiting part. What would happen? Everyone would rush to the dealer selling for the lowest price and order a GT500. Which example is really free market? I would say it's the later where dealerships compete to make sales.

New in production cars are not collector items. There are no more vintage GT500s being made. There X surviors and that's it. There are Y people that want them. Apples and oranges.

On Fri, 27 Oct 2006 15:27:53 -0500, snipped-for-privacy@yahoo.com (Brent P) wrote something wonderfully witty:

That is the textbook definition of supply & demand.

Again supply & demand. There is only one source of supply for the dealers, Ford and one source of supply for the end-consumers, the dealers. Ford has for a multitude of reasons decided to keep the supply of that particular car constrained in order to keep demand at a point where the price won't get eroded. It is a specialty vehicle after all. No one requires it, only wants it.

The market always has a choice to reject any non life essential product that is placed into it. What makes a market free is its ability to demand or reject products placed into it. No one is forced to buy GT500's at any price.

Excellent post! When I went to the Javitts center at the GT500's debut they said they were going to make as many as the market demanded of these cars. I was very pleased to hear this as well as them trying to price it at what the '04 Cobra cost. I figured they can easily do this without the independent rear suspensions to cut costs. Instead they limited the production which increases the demand in turn raising the prices. Ford would have been better off making 20k or more of these cars which isnt much when you think of it as four per dealership. I bet if they had increased production there would be much fewer BMW's or Corvettes sold. I just left a local Ford dealership and asked about the Shelby GT that comes out in January. They said they were also going to cost $20k over sticker, sigh... Ford needs to change this mentality people do remember and when the Camaro and Charger come out will throw it back in their face if they could. IMO that is the only reason why they are getting away with this, no competition. Personally I would buy a Corvette over a Shelby GT costing $55k more car for the money and a weight a sports car should be.

Greed is what is killing this company. A great example of this is buying a bunch of the European luxury makers and forgetting what Henry Ford believed in the first place, a car for the common man. I do see the Japanese car manufacturers making the same mistakes as the American counterparts. They are cookie cutting cars the same way. Example is that a Camry, no it says Lexus ES. I also hear with the increased production numbers they are having much more reliability problems.

Nick

In the end no one is holding a gun to a buyers head and forcing him to pay a given price. You know who really sets the price? It's the buyer. If no one is willing to pay the dealer's asking price then they will eventually lower the it until the car sells. It's a real simple concept.

The reason the prices are silly right now is there are a few people willing to pay what I consider and outrageous price for the few available cars. Once the dealers wade through these buyers and the cars aren't moving at the current prices they will have to lower the price to get off the inventory.

And there will ultimately be a limited number of GT500s. A vintage GT500 falls under the same supply and demand forces as a 2007 GT500. If Ford made GT500s like they make Fusions what do you think the price would be? You and I are no different from Ford. We all will take the highest price for whatever item we are selling. I don't fault the dealer for getting the highest price they can command. It is the way capitalism works. I will be pissed off at Ford if they don't produce the number of units they have stated. If they don't there is a good chance I will not be a Ford only buyer anymore. That is how I will make my statement on the matter. ;)

Henry,

Was the price clearly marked on the vehicle - as in on the window sticker? If so, get your financing lined up at your bank then walk in and ask for the sales manager. Tell him that you'll take the GT500 for the price they're advertising it for.

When he says that's not the real price, that it's actually $70k then tell him you'll be back in with the local investigative news program to ask him why he's running a bait-and-switch. Be reasonable, but be a little loud about it and watch what happens.

You could also mention that you'll be placing calls to your state's attorney general's office, better business bureau, chamber of commerce, etc. to let them know how that dealership does business. Then ask for the number to the Ford's regional rep, as well as the general manager and owner(s) of the dealership...

If they're posting the price on the vehicle then they should honor that price.

mark h

Of course. It's going to come down to availablity for a lot of people. The chevy dealer a few blocks away from me has no trouble keeping Corvettes in stock and quite clearly sells them in volume, not as sacred relics. I doubt a BMW dealer is going to give a buyer any problems over a

I am tempted to wait until they come out just for that. Odds are the GT500 will be canceled for low sales before that happens. Low sales with all this interest because the dealer network upped the price far out of wack with what the car is and the buyers went elsewhere.

The vette isn't exactly a lightweight, but for the prices dealers are asking for the GT500, one can get a top of the line vette or close to it or an M3 or various other cars that are simply more bang for the buck.

There really isn't a problem with them having said makes. The big problem is that most of the Ford line is boring crap. The 500, a warmed over volvo if I remember right, isn't doing it.

Absence of a gun to your head is not the definition of a free market.

Didn't I just finish writing that?

Maybe.

There will ultimately be a limited number of Foci, just as there are a limited number of Tempos and Pintos.

No it doesn't by the very fact the 2007 GT500 is in production. There will never be another '67 GT500, only less.

MSRP or less just like every practically other production new vehicle on the market.

I would weigh permantly pissing off customers and getting customers to look at vehicles from other manufacturers into the equation. I would consider those long term losses to be more important than the short term gain. But hey, I am not chairman of Ford as it loses billions every quarter. The short term thinking seems to be working out well for them don't you think?

Yes, capitalism in practice is rarely free market. It's about manipulating markets and creating monopolies really.

Which is exactly what will happen as people end up buying something else because Ford dealers wanted an extra 20 grand.

Then we are in agreement.

The sticker isn't advertising. The sticker is just what the manufacturer MSRP is and nothing more. It was to let buyers know what the MSRP is. The dealer is apparently playing by the letter of the law. If the dealer removed the window sticker and replaced it with their own at $70K that would be a story for the news people.

You're free NOT to pay the asking price. ;)

So, why blame the dealer for high prices? It is just as much the fault of the buyer.

If Ford makes enough GT500s this will happen.

You seem to think their is a difference in selling a vintage GT500 verses a 2007 model. Market forces are the same for both cars. If you have a problem with a 2007 GT500 selling for $60k then you should have a problem with a vintage one selling for $100k.

They both fall under the same principle of supply and demand. In a few months there will never be another 2007 GT500, only less.

EVERY dealer does what Ford is doing when they have a super hot limited production vehicle. It is what every business does when they have a chance to maximize profits. I do it every chance I get. Every time you accept a raise you do it too. Ford loosing money right now isn't a result of overcharging for their vehicles. They need desirable products, IMO. Most people (in fact, nearly all of them) in this country could care less what Ford gets for a GT500. They only care about what Ford gets from THEM.

It's about beating your competition and making your products desirable.

They won't want an extra $20k if the cars are backing up on their lots unsold. IMO, this will happen if Ford makes the number of GT500s they have stated.

Finally! ;)

I've read all the posts and most are correct. I bought my first Ford (05 GT, 5 Spd, sonic blue) due to the Camaro being cancelled in 'early 05 and then they saw the error of thier ways.

Ford did the same thing with the GT (GT40 remake). The list was $140K and the dealers were selling for $250+. The GT40, GT500 and Shelby are niche cars. Most will be purchased, then stored and shown on rare occaisions. You can buy a Mustang GT for about $29K full loaded and then if you reallly want, put on the supercharger for about $5K to get to the 500HP range.

At a local meeting I saw/heard the first Shelby sold in San Antonio. Wasn't impressed by the interior finish or the engine, I expected more for $70K. I did like the hood (although the hood scoops are non-functional) and I REALLY do like the front end, very much more agressive than the standard Mustang GT.

Is Ford short changing the loyal customer base, IMHO, YES. Look at their sales numbers and quarterly loss statements. Ford recently (posted in this NG) told any Mustang related item, they either had to pay a licensing fee or be sued. Possibly Ford should pay a royalty fee to the breeders that named the Mustang in the first place as that's where Ford got the name for the "Pony" car???

For $70K, I'll purchase a BMW or Porsche, while I like my Mustang GT, no Ford (short of the classics) are worth $70K.

That price isn't being set by free market conditions.

That's why I called the buyers who paid it morons and idiots. Try to pay attention.

Doesn't look like they are going to.

Market forces are entirely different for a product that is in production vs. one declared collectable. Any auction house should be able to explain the difference. And yes, I don't think the vintage ones are worth a 100K. And once the baby boomers start dying off they won't be any more.

In a year's time you can say that. But there is a free market of vintage cars because they trade hands privately and nobody is controlling supply. Let's say Bob and Frank have identical '67 GT500s. Bob needs money bad, Frank doesn't. Frank is asking a $110K, Bob needs the money sooner and undercuts Frank, you buy Bob's car for $102K. That doesn't happen in the new car game when a dealer just has one or two of a car that has any kind of demand for it and won't get any more. They, like Frank, can just sit and wait until someone will pay what they ask. They don't have to move the cars, they can just let them sit and wait for the payoff.

So you screw over every ignorant customer that walks in your door? Where do you draw the line on maximizing profits? Where's the line? Or is there even a line?

My father had a bad chevy once. He didn't get treated well by the chevy dealer either. That was in 1981. He will never buy a GM car again. Since

If you are always seeking to maximize profits now you are going to need a constant supply of new customers to make up for the ones who later learned better or felt you were trying to screw them and walked out the door and bought from someone else. Maximizing profits in the short term carries a great deal of risk for the long term. Unlike you apparently, I would consider that.

The beating your competition part is part I was refering to. For example, microsoft's practices.

If they don't cancel it for it lack of orders.

If we were talking about Ford Escorts or Taurus's I might agree, but this is a limited production specialty vehicle that not a single person on earth *needs* to have. By definition the whole point of this kind of vehicle is that they are scarce and overpriced and intended for people with more money then they have a need for. I suppose you can call it market manipulation but it's certainly not the same kind of manipulation for greedy and nefarious purposes as the oil price game is. Ford isn't trying to manipulate a mid-term congressional election outcome they way the oil companies are doing.

At $70K for a Mustang, I'll take an E Saleen...its only 60K and has

Mark

Nobody needs a car of any kind if you want to get down to it and play the need game. So basically what you're saying is that you find it acceptable to call a manipulated market a free market if it's a certain kind of product.

So, you think a Mustang GT should be $45K ? How much for a V6? Remember some people see even a base V6 as frivious vehicle. Maybe you should consider a used geo metro, something sensible you know.

Ford (and GM, and others) does attempt to manipulate automotive regulations however.