Many vehicles currently over MSRP

[Hank 615]

If this were a normal market where the dealerships could get inventory for all models then I would agree with you, but that’s not the case. Dealerships base their financials on hitting a sales goal, say 300 units per month. When the manufacturer can only deliver a couple dozen cars a month there is not enough profit at MSRP to make the financials work. It’s a dealership model, so there is always greed involved, but this is something different.

Go ahead and don’t buy a new vehicle this year, there are millions of other people who have the money or need a car and are willing to pay the premium to have something now.



Exactly how many people on this forum are left holding the bag on a Grainger under invoice Bronco deal into 2023 or later? It doesn’t matter how good the deal is if they can’t get inventory. I’ll pay MSRP and have my Bronco in a more reasonable amount of time. Nothing against Grainger, Ford screwed them.

You're drastically misunderstanding him. The point is that dealerships as an institution are not *really* subject to simple 'supply v demand' economics because they don't produce nor are they the end consumer. At *best* a dealership is palatable and 99% of the time they're just obfuscatory and conniving. In a truly free market they wouldn't even exist.

Sponsored

 

[rugbysecondrow]

My small town dealership bases their finances on selling 20 cars per month to a small, repeat customer base. They are doing OK in this market and are not charging big ADM. I’ll be buying my Bronco from them in a few weeks for MSRP. They did ask me if I would consider using their financing so they could make a few more bucks, I told them that if the rates were comparable I would have no problem using theirs.

On the contrary a large dealership that normally sells hundreds of vehicles per month is not doing well selling dozens. There is a much larger overhead, staff burden, parts inventory, etc. to float month to month.

This.

The markets are localized, to a great degree. My Ford dealership typically fits 50+ cars in the show room, today it has 6 and they were all fleet vehicles. Their lot is also sparse, with some vehicles, but you will pay a lot for maybe an option you don't fully desire. They just don't have cars to sell.

Couple this low supply with high demand, and an insane amount of money hitting the street, and of course prices will rise. It isn't even a complicated issue or hard question.

It is amusing to me that so many people lament these market facts, labeling them as greedy etc, but will gladly and surely benefit when they sell or trade in their used vehicle.

 

[Blitzjb]

What idiot is paying $100K for a RAV4?

The same idiot that pays.100k for a bronco fe

 

[Jer]

The way things are it makes my life simple. I'll be keeping my 2014 Wrangler and Ram a few more years. Same with my Trailer. The RV industry is just a screwed up as the auto. The Bronco is cool but it's the first year of a new vehicle with no history. You got money to burn, go for it. It's called capitalism, supply and demand. Under normal situations it's bad enough, but with the way the world is now you could have a nice paperweight you are making payments on sitting in the driveway. Example,,,, a few months back Wranglers were parked due to no oil cooler/filter housing in stock and thousands on backorder. I hope things get better soon, but they won't.

No history? 1966-1996 isn’t part of history?

 

[NMBronco2021]

I received this email by Star Lake Ford this morning when questioning their markups on their Broncos.
@Ford

Craziness!!!!! With dealerships like this, Why would Ford not entertain a direct sale model similar to Tesla….Give customers the choice to buy thru a dealership or buy direct.

So Glad that this isn't my dealer...I would run like that wind...

 

[NMBronco2021]

What idiot is paying $100K for a RAV4?

I have a 2019 Rav4 I will sell them....

 

[DustyBronco]

Almost 50k for a base bronco

 

[DrewBronc21]

the market will return to normal and Broncos will become the mass produced rental car status vehicle they were intended to be and the dealers who had crazy high ADMs pushed customers to other dealers or even other manufacturers and most won’t come back. It’s shortsighted for them to add high ADMs based on current situation. I’ve bought many new cars and simply refuse to pay ADM and any dealers asking for ADM will never get my business again and I will tell friends and family to stay away as well.

 

[BroncocnorB]

I remember when the ford Probe had huge ADMs. Lol

 

[pony2bronco]

All these arguments about commodities extending delivery and dictating the price increases... Got my wrangler 4xE a month after I ordered it and under invoice.

 

[Bronco Pilot]

I can add one data point to this discussion. I ordered a lightning blue 4 door first edition with late availability black leather. It finally came in on Wednesday. After reading the horror stories I was prepared for a battle at the dealership over price. However, Ford Country in Henderson Nevada had me in and out in 30 minutes with no hassle at MSRP.

I can tell all of you it was worth every day that I had to wait for this thing. I am a little worried, because the FE is way more luxurious than I was expecting. I am going to die a little inside to start beating on it, but hey....Broncos are built wild right ?

 

[Liberaldemon]

CR Ford Authority article

In think we will all remember in a few years when we are buying/leasing/trading in Fords which dealers acted in what ways. I worked to find a dealer that wasn’t screwing people over during this time and they will be getting all my service business and future sales.

 

[Tippster]

I can’t tell you how bad I feel for buying my bronco @ msrp and it being worth $20,000
More than I paid for it.

Its not "worth" any more - its just there are idiots willing to pay more than its "worth" -

 

[UtahLars]

What are you basing that on? Banks and CUs have financed ADMs in the past.

Depends how far in the past and how regulated the financing institution is. If the terms of the loan are based on the value of the collateral, the bank needs to get a certain amount of coverage and the regulators will look at whether the banks follows its underwriting guidelines when they inspect the bank and give it a grade. Unregulated car lenders might be more aggressive. But I think the original point is right: this is secured lending based on collateral. There is a certain loan to value limit that regulated institutions will stick to. The ADM adds no value from the bank's perspective unless those values start to show up in the data on actual used car transactions. Doubtful ADMs of this level will do that. So I think the original point is correct, big ADMs of this nature will not generally be financeable by regulated institutions.

 

[cscottp67]

Its not "worth" any more - its just there are idiots willing to pay more than its "worth" -

Items are only worth what you can sell them for. If I sold my bronco for $80,000 than the person who bought it was worth it to them. In business you can’t make a blanket statement like that. If that was the case an oz of gold would still be worth $30.

Sponsored