ADM and destroyed dealer relationships?

[2022 Ruth]

Does capitalism apply to Ford being subsidized between $800MM and $1.2B for EV manufacturing? I missed that day of free markets 101 and government interference. Same for GM over the years, unless we turn a blind eye to those facts and only look at it at the consumer end.

Yes I know, at the end of the day if I don't like ADM's don't pay it. And I won't because "capitalism" if that's really how you think the US markets operate.

I think this is being overcomplicated.

Take all the corporate cronyism and govt corruption, bail outs, whatever, the market drives the price.

If you have 1 of something and 100 people want it, you can charge more.

If you have 100 of something and 1 person wants it, you will charge less.

Bailouts are usually bad unless the company pays them back with interest or the company going out of business would have a net impact greater than that of the bailout. But again, that doesn‘t directly impact supply and demand.

 

[2022 Ruth]

Not really. Capitalism doesn’t require the dealer allocation model. Capitalism would be me being able to place an order from any Ford dealer of my choosing, and get my truck in roughly the order that it was placed.

This allocation model is closer to crony capitalism, although that implies government collusion which isn’t the case here.

True capitalism wouldn’t require me to purchase my vehicle from a dealer either. I should be able to buy directly from the manufacturer. That is changing, but the dealer model is a holdover from legitimate crony capitalism.

All that said, you’re right about MSRP being a made up number.

In the end, the Raptor is a toy. It’s not a necessity for any of us. My money will be going elsewhere if I don’t get one at sticker. I’m not paying ADM for my raptor, or my GT3. Or anything else for that matter. I simply refuse to play that game. If that means I wait, so be it. If that means I find an alternative vehicle…then that’s how it goes.

I think people miss the meaning of capitalism from a consumer standpoint.

If you don’t like it, go by from someone else. If enough people don’t like it, the company will change in response to the market.

Porsche, the most profitable car company in the world, sells the most profitable car in the industry. The 911. You are paying a huge markup because you want a Porsche and there is nothing wrong with that. If no one was buying Porsches at this price, the price would come down. Some of these new Porsches are pushing 200 grand. Not because they have a ton of money in their production, but because people will pay that much. Nothing unique about the raptor.

 

[chris51080]

I think people miss the meaning of capitalism from a consumer standpoint.

If you don’t like it, go by from someone else. If enough people don’t like it, the company will change in response to the market.

Porsche, the most profitable car company in the world, sells the most profitable car in the industry. The 911. You are paying a huge markup because you want a Porsche and there is nothing wrong with that. If no one was buying Porsches at this price, the price would come down. Some of these new Porsches are pushing 200 grand. Not because they have a ton of money in their production, but because people will pay that much. Nothing unique about the raptor.

As I said before though, I have no problem with dealers charging ADM. I simply will not purchase anything from them.

My issue is that Ford has their antiquated allocation model. They need to fix that if they want to succeed in the EV world. Like it or not, Tesla has set the bar for EVs, and that’s direct to consumer, without the ADM nonsense.
Now you can argue that Tesla does the “ADM” thing in the form of increasing their prices, and that’s a fair point, but the consumer gets to easily buy at a set price, and gets their car in roughly the sequence that their order was placed.

I’m very familiar with Porsche. And those relationships that some have claimed are non existent are how I don’t do ADM with them. The current runup on prices isn’t affecting me though since I have no desire to get a new 992. I’m also waiting on my used 911 until after the COVID pricing dies down. 175k for a 997 gt3, or 225k for a 991.2 GT3 is just not worth it.

 

[2022 Ruth]

I always look at it as doing what is fair. You

As I said before though, I have no problem with dealers charging ADM. I simply will not purchase anything from them.

My issue is that Ford has their antiquated allocation model. They need to fix that if they want to succeed in the EV world. Like it or not, Tesla has set the bar for EVs, and that’s direct to consumer, without the ADM nonsense.
Now you can argue that Tesla does the “ADM” thing in the form of increasing their prices, and that’s a fair point, but the consumer gets to easily buy at a set price, and gets their car in roughly the sequence that their order was placed.

I’m very familiar with Porsche. And those relationships that some have claimed are non existent are how I don’t do ADM with them. The current runup on prices isn’t affecting me though since I have no desire to get a new 992. I’m also waiting on my used 911 until after the COVID pricing dies down. 175k for a 997 gt3, or 225k for a 991.2 GT3 is just not worth it.

You may not do ADM with Porsche but Porsche, as a company, is marking those cars up almost 60% from what they have in them. That is why their profitability is so high, supply and demand.

Im not supporting either method, ADM, no ADM, a dealer or a non dealer model. Any way you slice it, the market will determine the price. If ford went 100% direct to consumer, would prices come down? Say people have no problem paying 60 grand for an XLT f150 though a dealer. Ford gets rid of the dealers and all of a sudden, these same trucks are $50,000? It sure would be nice, but Ford will charge as much as people are willing to spend and right now, that is a hell whole of a lot.

And buying a tesla or getting one serviced, sucks ass . Teslas profit margin on each car sold is almost 30%. Why so high? They are direct to consumer. Because they priced them where people are willing to pay for them.

 

[chris51080]

You may not do ADM with Porsche but Porsche, as a company, is marking those cars up almost 60% from what they have in them. That is why their profitability is so high, supply and demand.

Im not supporting either method, ADM, no ADM, a dealer or a non dealer model. Any way you slice it, the market will determine the price. If ford went 100% direct to consumer, would prices come down? Say people have no problem paying 60 grand for an XLT f150 though a dealer. Ford gets rid of the dealers and all of a sudden, these same trucks are $50,000? It sure would be nice, but Ford will charge as much as people are willing to spend and right now, that is a hell whole of a lot.

And buying a tesla or getting one serviced, sucks ass . Teslas profit margin on each car sold is almost 30%. Why so high? They are direct to consumer. Because they priced them where people are willing to pay for them.

Call me a capitalist, but I’d rather the money go to the manufacturer. There’s more value there, and I can invest in that manufacturer through stock purchases to pad my bottom line too.

I’ve heard the stories from friends with Teslas. There’s definitely a downside to having no dealer network. That said, that’s not what kept me from buying one…the S class and Panamera were simply better cars when I was buying. Today, were I in the market for a family sedan, I’d be giving a hard look at Lucid.

 

[2022 Ruth]

Call me a capitalist, but I’d rather the money go to the manufacturer. There’s more value there, and I can invest in that manufacturer through stock purchases to pad my bottom line too.

I’ve heard the stories from friends with Teslas. There’s definitely a downside to having no dealer network. That said, that’s not what kept me from buying one…the S class and Panamera were simply better cars when I was buying. Today, were I in the market for a family sedan, I’d be giving a hard look at Lucid.

Same here about giving money to the manufacturer. Car dealers are a bit like real estate agents. They take a lot of your money but don’t really add much value.

 

[DFS]

I think this is being overcomplicated.

Take all the corporate cronyism and govt corruption, bail outs, whatever, the market drives the price.

If you have 1 of something and 100 people want it, you can charge more.

If you have 100 of something and 1 person wants it, you will charge less.

Bailouts are usually bad unless the company pays them back with interest or the company going out of business would have a net impact greater than that of the bailout. But again, that doesn‘t directly impact supply and demand.

Yes, if this was a lemonade stand I would agree. If the Federal Reserve is considered the market and part of supply and demand then sure, I over complicated it. No doubt there is room for nuance and different interpretations of how deep into the macro/micro level we want to dive. I just hate our current economy being referred to as a free market when that is only the case for average consumers, not the billion dollar companies we buy from.

 

[2022 Ruth]

Yes, if this was a lemonade stand I would agree. If the Federal Reserve is considered the market and part of supply and demand then sure, I over complicated it. No doubt there is room for nuance and different interpretations of how deep into the macro/micro level we want to dive. I just hate our current economy being referred to as a free market when that is only the case for average consumers, not the billion dollar companies we buy from.

You are certainly right. There is no pure anything but basic market driven supply and demand principles still apply.

 

[wweaver]

I just picked up my 22 37pp two days ago. Ordered it last June, my dealer that I had bought two gen2s from this time wanted 20k over. I called the next dealer down the road 20 minutes and they ordered it at msrp and were great to work with. I get two vehicles every two or three years. It may take awhile but they will loose that 10k in long run. The salesman was frustrated with the GM as I would have done 5k. He said they sold the 37pp when it came in for 15k to an out of state buyer. I know my “New” dealer will make 4/5 on my trade in also. There are a lot of dealers doing this right now, but the market will work itself out, it always does.
That extra fluff is going into vacation homes, boats and second wives bank accounts. I agree it would better spent by Ford on making a better truck.

 

[melvimbe]

That extra fluff is going into vacation homes, boats and second wives bank accounts.

Your's or the dealer's?

I don't think your wrong at all for wanting to get the best deal on the truck, but claiming that the dealer doesn't really need the money isn't really a good argument. Not saying that's what you were going for exactly. Part of the reason why capitalism works (generally) is that you only worry about what you need from the deal rather than being judgmental of what the other guy needs. Does it really matter to you if the dealer is going to buy luxuries, invest in his business, feed his kids, or give money to charity?

Not a fan of equity.