Industry Issue with prioritizing early reservation holders?

[TigerBronco]

Our frustrations with Ford and how early reservation holders got jumped is now being shared by Rivian. Not just a Ford problem.

For EV maker Rivian, delivery headache hits as market shuts down coffers (msn.com)

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[indio22]

Our frustrations with Ford and how early reservation holders got jumped is now being shared by Rivian. Not just a Ford problem.

For EV maker Rivian, delivery headache hits as market shuts down coffers (msn.com)

It never really was a reservation system, at least not what people typically think of one, strictly ordered by when a reservation is made. The early reservation thing was as much about marketing and data collection as anything else.

But some customers love reservations, look how they flocked to it, for a vehicle they had not test driven, much less even seen in person.

The reservation thing can help a company with buy-in, and making the customer feel like they got something exclusive and a leg up. And get people to hang on. There is psychology/marketing that went into this stuff.

 

[Dads_bronze_bronco]

It never really was a reservation system, at least not what people typically think of one, strictly ordered by when a reservation is made. The early reservation thing was as much about marketing and data collection as anything else.

But some customers love reservations, look how they flocked to it, for a vehicle they had not test driven, much less even seen in person.

The reservation thing can help a company with buy-in, and making the customer feel like they got something exclusive and a leg up. And get people to hang on. There is psychology/marketing that went into this stuff.

What bugs me is we all put in reservations based on two or four door, and series. You’d think they took that “marketing data” and did supply chain planning for x number of two doors and y number of four doors and z number of Wildtrak components and so on, yet almost two years out they still have commodity shortages delaying July 2020 reservations (particularly two doors, Wildtraks and Badlands).

I can understand interruptions, but that only goes so far. It’s like they didn’t use the data.

 

[AZ_Liberty]

But some customers love reservations, look how they flocked to it, for a vehicle they had not test driven, much less even seen in person.

I really have zero need to test drive a vehicle. For me the only two questions are:

-- Is it a Ford?
-- Does it have a Stick Shift?

Then I know how it drives.

Now I made her test drive her F-150, but that was solely to determine if the 2.7 engine had enough pep. There was zero question I was buying her an F-150 that day, the only question was which engine I was going to have to pay for.

On Bronco I don't have a choice of engine.

 

[AZ_Liberty]

What bugs me is we all put in reservations based on two or four door, and series. You’d think they took that “marketing data” and did supply chain planning for x number of two doors and y number of four doors and z number of Wildtrak components and so on, yet almost two years out they still have commodity shortages delaying July 2020 reservations (particularly two doors, Wildtraks and Badlands).

Pretty sure we have early orders for 2-Door Base models still in limbo.

Ford took all that marketing data, and then simply failed to put out the additional capital needed, especially for the hard tops. Webasto is a cluster, but Ford owns the tooling, and Ford never spent a few million extra to buy enough tooling. So, to this day, Webasto can only build about 70% of the required hard tops.

I don't know if the 2-door and 4-door use separate tooling, or if it is the same mold with an insert to make it smaller for the 4-door. Either way is a legitimate design choice, but I suspect it's separate tooling.

I am also guessing that the 2-door top has a higher defect rate at de-mold. That's a guess, because while I am a Quality Engineer, and have quite a bit of experience with large molded composites, I don't work for the big blue F. Certainly we heard lots of reports/rumors on MIC 1.0 that the 2-door had a higher defect rate.

The continued shortage of wiring harnesses for the tow package is also a real head-scratcher. That's the type of part where they really should have had a 2nd qualified vendor on board within 30 days.

There probably isn't much Ford can do about the inability of GETRAG to deliver transmissions, but they absolutely should have shelled out the cash for hard top tooling last year. When they made the MIC 2.0 changes, they knew then that without more tooling it would take somewhere between 18 and 24 months to clear the backlog of hard top orders.

 

[acetdeucy]

Yeah it’s an industry-wide issue.

You basically got two options:

1. Prioritize based on when the customer reserved the vehicle.
2. Prioritize based on what lets you get the most vehicles out the door the fastest.

The vast majority of companies are going to do the latter. Fundamentally you gotta sell vehicles to make money to keep the business going, and idling the assembly line while you wait for components isn’t going to sell vehicles.

This is true for all companies, but especially important for a relatively new company like Rivian who is heavily dependent on outside investments. If those investors start running away… the company may not have enough capital to scale production. Then it’s becomes bad news for everyone.

...or 3. Prioritize the vehicles that offer the most Profit.

Early reservation holders have price guarantees, which eat about $2700, on average, out of each vehicle sold. Personally, I think it comes down to the order of: #3, then #2, then #1. Just sayin'.

 

[Skmac]

I can understand interruptions, but that only goes so far. It’s like they didn’t use the data.

as someone who works in the industry it seems only marketing actually uses the data, the rest of the groups just don't know how to use it

 

[Dads_bronze_bronco]

as someone who works in the industry it seems only marketing actually uses the data, the rest of the groups just don't know how to use it

So procurement basically said: “We’ll ignore the data showing what customers want, and continue on with the dealer inventory lot mix driven benchmarks we are using based on what Jeep produces.”

 

[Skmac]

So procurement basically said: “We’ll ignore the data showing what customers want, and continue on with the dealer inventory lot mix driven benchmarks we are using based on what Jeep produces.”

Pretty much, people at the top didn't want to over extended and in doing so fucked themselves and the customer. They went the safe route of doing what the customer aka dealers demanded which is mid range sellable but with a massive upmark.

As I said earlier i work in this industry and i see it all the time no one really knows how to handle customer or manufacturing data. It one of the giant reasons were in this supply chain mess as it is.

 

[TX_Bronco77]

What I ponder on slow days is how these manufacturer's (read Ford, I know nothing about Rivian) would have proceeded without all the pandemic excuses. I am not saying they aren't valid, at all. But I have trouble thinking of a scenario where the line would have followed even during "normal times".

My gut tells me Ford was going to do whatever they wanted/had planned and the reservation system was just to gauge interest. If Ford was given a choice between 1000's of orders at dealers with great deals over ADM dealers I cynically believe they would have went the ADM route.

I won't even get into the dizzying amount of packages/interiors they tried to start with during all these shortages. Was some of it bad luck, sure. But more of it was piss poor planning thinking the demand for a Ford favorite revived after so long wouldn't be as great as it is. K.I.S.S. would have worked out so much better in the customers favor here. Not to mention from a manufacturing stand point.

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