My local dealers attitude towards MSRP and below dealers

[Stampede.Offroad]

I'm curious what type of distribution system you propose would be better? ... Curious what is the reasoning behind your comment, and others who say the same thing.

Competition is not allowed, there are territories, backed by state laws. You could not open up your own 'car store' and start selling new Ford vehicles in someone else's territory if you thought you could sell the same product without offensive dealer markups.

They do not operate like a (non franchise) restaurant or other business, but I think they should. Real competition would eliminate most of the things people hate about stealerships.

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[rugbysecondrow]

My dealership was selling at MSRP, and said so upfront. If they say, "we are selling for $5,000 over MSRP upfront" and somebody decides to buy from them vs. elsewhere, so be it. They are being honest about the price.

I have a big problem with the surprise ADM practice, which I think is wrong. Whatever price was discussed upon ordering, is the price that should be paid when it is delivered.

 

[VictoryLights]

Your takeaway from that was to try to correct the way I stated more than a few??

Oooo K

No I just hope you made them feel like they are the outlier and not the other way around. Obviously, they think otherwise.

 

[jaspercasidino]

So you are paying $2500 ADM when you know MSRP or below is available? $5,000 ADM for the uninformed seems just fine I guess.

 

[Garemlin]

No I just hope you made them feel like they are the outlier and not the other way around. Obviously, they think otherwise.

Oh I did. The conversation went a lot deeper than I posted. And I was not rude. But I wasn't very cordial towards their opportunist attitude.

At the end of the day they either still didn't believe that dealers were selling below msrp. Or they still think they are losing money doing it and the sales people aren't making anything.

I ended the conversation with "I'd love to support my local business. But I'm not going to pay $5k over what I should to do it".

 

[Garemlin]

So you are paying $2500 ADM when you know MSRP or below is available? $5,000 ADM for the uninformed seems just fine I guess.

$2500 under MSRP

 

[SASProbie]

I dropped by to check on my order a few days ago. My dealer is selling orders at MSRP, like mine is, but they said cancelled orders that go on the lot are priced at 10k over. I don't have a problem with that because it really is the market at this time. While it's criminal to hold up someone with a previous order that is expecting MSRP, it is a fact that other dealers are buying Broncos at over MSRP to resell them, so to me it's reasonable to sell a Bronco that is on the lot for some amount of ADM. Used cars are worth quite a bit more than even a few months ago, WAY more than a few years ago, don't have a problem with some market price adjustment on new vehicles if the market will bear it. But, dealers and everyone else absolutely should keep their word on commitments.

^^^ This. Well said. If we put money down and mutually agreed to a price. That is the price. If I change my mind and decline the purchase, by all means get what the market will give!

That is how it has been for my entire life.

In fact, if I walked into a dealership today to make an order and they told me upfront that the ADM would be applied and we agreed. So be it! That is how this is to work. No different than my getting three phone calls in the last two weeks wit the opportunity to purchase a Bronco because the original orderer changed their mind. The offers have been at MSRP mind you. However, even if they had ADM. That is my choice to make.

The frustration here, is that those that made an order for a "Yet to be manufactured" vehicle and when we did, was told the price guarantee is in place. Now many are seeing that was a load of BS.

Too many that have agreements are getting screwed over.

This ADM add after the fact reminds me of the tactics that thugs and the mob apply. This is going to be a really big problem for all car manufactures if they do not reel their dealerships in and quick.

Imagine if ford could produce all the orders! Their stock would be setting records right now. How is that stock going to look once all those that want to buy, have. And now the supply is well beyond demand. They will be all but giving the vehicles away like they did from 2008-2012. Heck, just in 2019 we purchase an F-150 for $15,000 below MSRP! And we had thousands to chose from (If the dealer needed to find "The" truck for us).

I mean think of it like this... You have an opportunity to order a new gadget before they are manufactured. Part of the enticement to buy it now, is you get the " Advanced purchase discount before they are available to the general public". Only to have 15-25% added on top once the delivery driver is at your door? That delivery driver better be a big boy with some skills!

On the flip side... I am pretty sure that most dealerships are struggling. I have never seen nearly every single lot with 50-75% less inventory than they would normally have. Not to mention, most vehicles they even have to "Offer" are in Transit! Then you go to talk with the dealership, only to find out what they are offering online that is in transit, is a customer order. So, my wife is unable to even see a 2022 BMW 440i M in person. If she wants to, we have to get permission from the person that ordered their car (Once it comes in), so we can look at it. Or do what we did with the Bronco, order sight unseen and hope for the best.

Every brand is struggling in getting vehicles that the market wants. I believe that the lots see the current market as a way to supplement their costs with the lack of traffic/inventory/actual sales.

 

[Bob 07064]

I dropped by to check on my order a few days ago. My dealer is selling orders at MSRP, like mine is, but they said cancelled orders that go on the lot are priced at 10k over. I don't have a problem with that because it really is the market at this time. While it's criminal to hold up someone with a previous order that is expecting MSRP, it is a fact that other dealers are buying Broncos at over MSRP to resell them, so to me it's reasonable to sell a Bronco that is on the lot for some amount of ADM. Used cars are worth quite a bit more than even a few months ago, WAY more than a few years ago, don't have a problem with some market price adjustment on new vehicles if the market will bear it. But, dealers and everyone else absolutely should keep their word on commitments.

selling abandoned rigs for a premium is to be expected but to gouge the guy whos waited a year+ is just a dick move....

 

[rustedgoat]

Slapping on a last minute ADM is just wrong. Plenty on threads about that.

Dealers have to set prices to maintain inventory they don't want inventory just sitting on the lot, but they also can't have no inventory to sell (supply issues). Dealers are there to make a profit, non-ordered Bronco should be sold at what ever price the market bears. That customer walked in and the decides if they want it at that price or not. Nothing wrong with a $5000 markup if someone is willing to pay it. That would be more profit than most "loyal" customer will ever give them in the next few years in service (warrantied repairs). If someone wants accessories their going to scan the internet for the cheapest deal, so no loyalty there. If someone can really find a dealer actually selling at msrp to walk in customers then go for it. Local dealers provide the same service regardless of where you purchased your Bronco.

The whole dealer structure is due for a change, those online only dealers that deliver the car to you are already getting popular.

 

[jaspercasidino]

$2500 under MSRP

Ahh gotcha. I read that multiple times and missed it every time.

Where did you order from and do you think that it is affecting your delivery timeline?

I’m at MSRP with low sales tax area (WA is different from other states) so I’m happy with my deal personally. Scheduled for a build in a couple weeks (if it holds).

 

[Garemlin]

Ahh gotcha. I read that multiple times and missed it every time.

Where did you order from and do you think that it is affecting your delivery timeline?

I’m at MSRP with low sales tax area (WA is different from other states) so I’m happy with my deal personally. Scheduled for a build in a couple weeks (if it holds).

Chapman in Horsham PA. And yes I am sure it affects my delivery. They still have quite a few reservations that haven't been scheduled. I only ordered without a reservation December 23rd. Didn't reserve because I had always planned on waiting until 2023 anyway. But who knows when mine will come up. Seems it's based on buildable units and allocations more than anything right now. When my number comes up it comes up. I'm not in any kind of hurry.

 

[Bronco cat]

They only get away with this **** because the dealership system gives them a monopoly.

People need to back ballot initiatives to get rid of this system, the politicians aren't going to introduce legislation to do it, they get campaign funds from them.

Exactly how is this a monopoly? You realize if it were a direct to consumer model you would still be paying whatever ford wants you to pay. Look at how volatile teslas prices and models are. They can change from day to day or hour to hour. You could easily go to any dealer you want. Getting rid of dealers just creates a whole new issue. Do you think ford really wants to trade you for your clapped our civic when you buy a new car……

 

[Bob 07064]

Slapping on a last minute ADM is just wrong. Plenty on threads about that.

Dealers have to set prices to maintain inventory they don't want inventory just sitting on the lot, but they also can't have no inventory to sell (supply issues). Dealers are there to make a profit, non-ordered Bronco should be sold at what ever price the market bears. That customer walked in and the decides if they want it at that price or not. Nothing wrong with a $5000 markup if someone is willing to pay it. That would be more profit than most "loyal" customer will ever give them in the next few years in service (warrantied repairs). If someone wants accessories their going to scan the internet for the cheapest deal, so no loyalty there. If someone can really find a dealer actually selling at msrp to walk in customers then go for it. Local dealers provide the same service regardless of where you purchased your Bronco.

The whole dealer structure is due for a change, those online only dealers that deliver the car to you are already getting popular.

Ford almost got it right with the whole reservation thing. The issue comes when they assigned you to a dealer to place the actual order. If they can run it like Tesla and still maintain the repair facilities as just that then it could work. That is of course you believe the bullshit story that dealers make no money on vehicles except for service and repair work....

 

[Pseudoko]

Until dealers have Broncos sitting on the lot waiting to be sold, ADM is going to be a norm for some dealerships. For now if people are willing to pay 2500-5000 (or whatever) over MSRP just to have the car, then the dealers will charge over MSRP. At least they are being upfront with the ADM amount.

I know some dealerships are going under inventory but chances are all the broncos are accounted for already. For simplicity, if there are 5 local dealerships and let's just say each one this year are allocated 50 Broncos (no custom orders). Let's say Dealer A is under MSRP, Dealer B and C are at MSRP, and D and E are above.

Dealership A may sell it under MSRP, so that dealer will be the one everyone is flocking too until they tell everyone that they are sold out for their MY22. Then obviously everyone will buy from B and C. It is a simple a supply and demand game. Dealership D and E who's sitting at 5k above MSRP might be waiting for people to buckle just to get a Bronco because they have to have it right now (I know... first world problems hahaha).

D and E might have to wait slightly longer but they will sell those cars this year even though we all balk at the ADM. Trust me I have switched dealerships because of it. But dealer D and E may lose reputation but the owners will look at the extra revenue and not even think twice about over charging people if they are willing to buy.

 

[Bob 07064]

Exactly how is this a monopoly? You realize if it were a direct to consumer model you would still be paying whatever ford wants you to pay. Look at how volatile teslas prices and models are. They can change from day to day or hour to hour. You could easily go to any dealer you want. Getting rid of dealers just creates a whole new issue. Do you think ford really wants to trade you for your clapped our civic when you buy a new car……

With Tesla its not "dealers" setting the price. You order thru Tesla, they deliver your car and then that's it. If pricing fluctuates at that point, it comes from the factory. All their service is done at your home or where you choose. The fluctuation in pricing comes from the secondary market where there are brokers who deal in all things Tesla....

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