Dealer asking for $2000 more....

[yngwenli]

Buyers hate paying ADM, of course, but in the grand scheme of things I'd rather have the ability to shop around to find a good deal than for the manufacturer to just jack up the MSRP for everyone, like Tesla and Rivian are doing.

We're seeing the other side of that coin now, and suddenly, selective ADM doesn't look quite as 'evil' by comparison.

I think upfront ADM is fine. Just make it plainly obvious. The price increase AFTER you ordered is plain bait and switch and should be penalized. Rivian raising price by 15-20% after you order is insulting. I'm sure a lot of pre-order holders hope the company now just dies and shuts down with that slap in the face.

At least Tesla is upfront that they just raised prices by $10k, so if you don't like it, don't buy.

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[dbsb3233]

I think upfront ADM is fine. Just make it plainly obvious. The price increase AFTER you ordered is plain bait and switch and should be penalized. Rivian raising price by 15-20% after you order is insulting. I'm sure a lot of pre-order holders hope the company now just dies and shuts down with that slap in the face.

At least Tesla is upfront that they just raised prices by $10k, so if you don't like it, don't buy.

Generally agree, although the root problem is the time lag. Over a wait of 6-18 months, the market price can significantly change (as it has). This is all a result of a severe supply-demand imbalance that creates long waiting lists.

When we get back to the point of better supply-demand balance such that people can buy a car same-day off the lot, or order one and get it in just a few weeks, then there's not enough time for the market price to soar in between.

 

[TGIF]

In the US, my dealer did require a $1000 deposit, fully refundable, but they were very upfront about it. I did the deal via text and phone.

 

[yngwenli]

Generally agree, although the root problem is the time lag. Over a wait of 6-18 months, the market price can significantly change (as it has). This is all a result of a severe supply-demand imbalance that creates long waiting lists.

When we get back to the point of better supply-demand balance such that people can buy a car same-day off the lot, or order one and get it in just a few weeks, then there's not enough time for the market price to soar in between.

True, supply issues are a problem, but that's not the consumer's problem or responsibility I feel.

If a manufacturer can't predict their costs for car prices 6-12 months out, then don't take the pre-order simply at all with any price tied to a reservation/pre-order.

They can close all order banks or have no listed price to reserve at all for now, then, actually build said car and price them at that point. Customer can then choose to take it or leave it for that price.

This is probably a lesson for all the car makers right now.

I wonder if Lucid is having issues with their 100k+ pricing, but their stock is looking more attractive possibly (it's still too high for me) purely as a tech/efficiency play since as a company that only sells sedans, that seems to be a bad market to be in (not that many wants to buy a sedan currently).

 

[dbsb3233]

True, supply issues are a problem, but that's not the consumer's problem or responsibility I feel.

If a manufacturer can't predict their costs for car prices 6-12 months out, then don't take the pre-order simply at all with any price tied to a reservation/pre-order.

They can close all order banks or have no listed price to reserve at all for now, then, actually build said car and price them at that point. Customer can then choose to take it or leave it for that price.

This is probably a lesson for all the car makers right now.

I wonder if Lucid is having issues with their 100k+ pricing, but their stock is looking more attractive possibly (it's still too high for me) purely as a tech/efficiency play since as a company that only sells sedans, that seems to be a bad market to be in (not that many wants to buy a sedan currently).

I can see both sides of it. Market pricing is a reality for both buyers and sellers. When market prices drop, buyers demand that lower price, so it's logical that sellers would do the same when the market price rises. Works both ways.

But I wholly agree that if the seller has made a firm commitment to the seller at order time that they will deliver the car at a pre-set price, then the seller should honor that. To not do so is unfair and dishonest.

The problem is usually rooted in the fact most of those order agreements don't actually lock in the price like that (although buyers often assume they do, and think MSRP is more than just a suggested price). That's where buyers really need to do their homework.

You're right that one way to avoid all this is to not take pre-orders way in advance (where the market price is likely to change). But many buyers want to place an order to guarantee a place in line. They just don't always realize that the market price may change half a year later when the car arrives.

 

[yngwenli]

The problem is usually rooted in the fact most of those order agreements don't actually lock in the price like that (although buyers often assume they do, and think MSRP is more than just a suggested price). That's where buyers really need to do their homework.

The problem is the dealer network on this. It's not Ford charging any mark up to the dealer currently and if they were to go with delivery pricing, it's the dealer itself. Ford sees none of that $10k ADM so has the dealer done anything beneficial to "earn" that extra $10k?

Most would say no since they know less about the car than most folks here and we just want to pick up the car. They can drive it to our house directly honestly and most would be probably ok with that.

I'd agree with you if Ford just came out and said the price of the car is whatever the market price is when it's built and at the dealer, the whole buying experience will change. I would be ok with that if it was just done upfront. I'll probably just drive older vehicles longer and probably put orders in for everything (with no price protection guarantees) to see what is available and what I really want.

I'm assuming this is the reason that Kia/Hyundai I've heard don't allow you to order vehicles, but again, does the manufacturer get any of the mark up or is it just a dealer? The dealer certainly isn't paying MORE to build the car.

 

[dbsb3233]

The problem is the dealer network on this. It's not Ford charging any mark up to the dealer currently and if they were to go with delivery pricing, it's the dealer itself. Ford sees none of that $10k ADM so has the dealer done anything beneficial to "earn" that extra $10k?

In the US dealership model, Ford is only a wholesaler. The retailer is the dealership, and they're the ones that take the hit if the market price drops, or the benefit if the market price rises. Risk/reward. Similar to Target or Home Depot buying products at wholesale from suppliers and then setting the retail price that the market will bear. In a strong market, their margins rise; but in a weak market their margins get squeezed.

The "earn" is in investing the money and taking the risk that the market may be strong or weak at any given time.

Also, when supply is tight like this, they have fewer vehicles to sell. So it could be argued they need a bigger margin on the lower volume of sales to keep up with expenses.

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