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Car Forum / Ford / Ford Mustang / November 2006Greedy Bastards.....
Last year I put my name on a waiting list for a GT500 with an out of town dealer. I was number nine on the list. I figured if I could get a brand new reliable Mustang with 500 hp for around 45K I might go for it. After several inquiries and many months, I finally received an email stating that the price is $65,000. I replied that I wasn't interested. So yesterday, I stop in at the local Ford dealer - not the one with the waiting list - to pick up an e brake cable for my Ranger. Holy sh.t, there's a GT500 on the showroom floor! I didn't think they were going to get any, so I never asked. I looked it over closely, and there are only two things I don't like - the white color and the stripes. But I do like the fact that the only price displayed on the car is the MSRP of $43K in the window. This dealer is known for its fair pricing, so when the sales guy walked over I asked him if they are selling the car for the price on the window sticker. He smiles and says "no". "How much is it", I ask. He disappears for a minute, comes back, and says "seventy thousand". I laughed and told him I'd wait for the price to reach a sane number. No way is it worth that. Ford should at least have used an aluminum block to keep some weight off the nose. Are people actually paying that much for them? Any guesses on what they'll sell for next year? -- http://911research.wtc7.net/talks/wtc/videos.htm http://911research.wtc7.net http://www.st911.org > Last year I put my name on a waiting list for a GT500 >with an out of town dealer. I was number nine on the list. [quoted text clipped - 19 lines] >weight off the nose. Are people actually paying that much for >them? Any guesses on what they'll sell for next year? This is only my guess, but I think it is fair to say "as much as they can get". You have to remember that it isn't Ford that is setting the market price, it is the market itself. If that dealer is able to move the one it has at $70k it will try to move the next one it gets at $70k. I don't know how much the dealers are paying for the cars when they but them from Ford, but it is safe to assume somewhere less then sticker price. -- You can run, but you'll only die tired. ZombyWoof >> Last year I put my name on a waiting list for a GT500 >> with an out of town dealer. I was number nine on the list. [quoted text clipped - 27 lines] > they but them from Ford, but it is safe to assume somewhere less then > sticker price. I don't see why anyone gets upset over the dealers maximizing their profit. You are absolutely right, the buyers set the price, not the dealers. If any one of us had a vintage GT500 we would sell it for the highest price we could get and not a penny lower. Why would we expect the dealer to do any less than us? If Ford makes their stated production numbers then I think the price will fall to around MSRP sometime next year. Right now they are being gobbled up by people that have plenty of money and desire for the car. The same thing happened with the Ford GT and now you can get one for around MSRP. It takes time to weed out the crazies that will pay nearly any price to have the car today. > I don't see why anyone gets upset over the dealers maximizing their > profit. Because it's a manipulated market. It's the same reason $3+ a gallon gasoline gets people upset. It's a manipulated market where others can't come in and undercut the competition. Let's say instead of dealer alotments, ford had open ordering until they ran out of the limiting part. What would happen? Everyone would rush to the dealer selling for the lowest price and order a GT500. Which example is really free market? I would say it's the later where dealerships compete to make sales. > You are absolutely right, the buyers set the price, not the > dealers. If any one of us had a vintage GT500 we would sell it for the > highest price we could get and not a penny lower. New in production cars are not collector items. There are no more vintage GT500s being made. There X surviors and that's it. There are Y people that want them. Apples and oranges. >> I don't see why anyone gets upset over the dealers maximizing their >> profit. [quoted text clipped - 8 lines] > is really free market? I would say it's the later where dealerships > compete to make sales. In the end no one is holding a gun to a buyers head and forcing him to pay a given price. You know who really sets the price? It's the buyer. If no one is willing to pay the dealer's asking price then they will eventually lower the it until the car sells. It's a real simple concept. The reason the prices are silly right now is there are a few people willing to pay what I consider and outrageous price for the few available cars. Once the dealers wade through these buyers and the cars aren't moving at the current prices they will have to lower the price to get off the inventory. >> You are absolutely right, the buyers set the price, not the >> dealers. If any one of us had a vintage GT500 we would sell it for the [quoted text clipped - 3 lines] > GT500s being made. There X surviors and that's it. There are Y people > that want them. Apples and oranges. And there will ultimately be a limited number of GT500s. A vintage GT500 falls under the same supply and demand forces as a 2007 GT500. If Ford made GT500s like they make Fusions what do you think the price would be? You and I are no different from Ford. We all will take the highest price for whatever item we are selling. I don't fault the dealer for getting the highest price they can command. It is the way capitalism works. I will be pissed off at Ford if they don't produce the number of units they have stated. If they don't there is a good chance I will not be a Ford only buyer anymore. That is how I will make my statement on the matter. ;) > In the end no one is holding a gun to a buyers head and forcing him to > pay a given price. You know who really sets the price? It's the buyer. > If no one is willing to pay the dealer's asking price then they will > eventually lower the it until the car sells. It's a real simple concept. Absence of a gun to your head is not the definition of a free market. > The reason the prices are silly right now is there are a few people > willing to pay what I consider and outrageous price for the few > available cars. Didn't I just finish writing that? > Once the dealers wade through these buyers and the cars > aren't moving at the current prices they will have to lower the price to > get off the inventory. Maybe. >>> You are absolutely right, the buyers set the price, not the >>> dealers. If any one of us had a vintage GT500 we would sell it for the >>> highest price we could get and not a penny lower. >> New in production cars are not collector items. There are no more vintage >> GT500s being made. There X surviors and that's it. There are Y people >> that want them. Apples and oranges. > And there will ultimately be a limited number of GT500s. There will ultimately be a limited number of Foci, just as there are a limited number of Tempos and Pintos. > A vintage > GT500 falls under the same supply and demand forces as a 2007 GT500. No it doesn't by the very fact the 2007 GT500 is in production. There will never be another '67 GT500, only less. > If > Ford made GT500s like they make Fusions what do you think the price > would be? MSRP or less just like every practically other production new vehicle on the market. > You and I are no different from Ford. We all will take the > highest price for whatever item we are selling. I would weigh permantly pissing off customers and getting customers to look at vehicles from other manufacturers into the equation. I would consider those long term losses to be more important than the short term gain. But hey, I am not chairman of Ford as it loses billions every quarter. The short term thinking seems to be working out well for them don't you think? > I don't fault the > dealer for getting the highest price they can command. It is the way > capitalism works. Yes, capitalism in practice is rarely free market. It's about manipulating markets and creating monopolies really. > I will be pissed off at Ford if they don't produce > the number of units they have stated. Which is exactly what will happen as people end up buying something else because Ford dealers wanted an extra 20 grand. > If they don't there is a good > chance I will not be a Ford only buyer anymore. That is how I will make > my statement on the matter. ;) Then we are in agreement. >> In the end no one is holding a gun to a buyers head and forcing him to >> pay a given price. You know who really sets the price? It's the buyer. >> If no one is willing to pay the dealer's asking price then they will >> eventually lower the it until the car sells. It's a real simple concept. > > Absence of a gun to your head is not the definition of a free market. You're free NOT to pay the asking price. ;) >> The reason the prices are silly right now is there are a few people >> willing to pay what I consider and outrageous price for the few >> available cars. > > Didn't I just finish writing that?\ So, why blame the dealer for high prices? It is just as much the fault of the buyer. >> Once the dealers wade through these buyers and the cars >> aren't moving at the current prices they will have to lower the price to >> get off the inventory. > > Maybe. If Ford makes enough GT500s this will happen. >>>> You are absolutely right, the buyers set the price, not the >>>> dealers. If any one of us had a vintage GT500 we would sell it for the [quoted text clipped - 8 lines] > There will ultimately be a limited number of Foci, just as there are a > limited number of Tempos and Pintos. You seem to think their is a difference in selling a vintage GT500 verses a 2007 model. Market forces are the same for both cars. If you have a problem with a 2007 GT500 selling for $60k then you should have a problem with a vintage one selling for $100k. >> A vintage >> GT500 falls under the same supply and demand forces as a 2007 GT500. > > No it doesn't by the very fact the 2007 GT500 is in production. There > will never be another '67 GT500, only less. They both fall under the same principle of supply and demand. In a few months there will never be another 2007 GT500, only less. >> If >> Ford made GT500s like they make Fusions what do you think the price [quoted text clipped - 12 lines] > quarter. The short term thinking seems to be working out well for them > don't you think? EVERY dealer does what Ford is doing when they have a super hot limited production vehicle. It is what every business does when they have a chance to maximize profits. I do it every chance I get. Every time you accept a raise you do it too. Ford loosing money right now isn't a result of overcharging for their vehicles. They need desirable products, IMO. Most people (in fact, nearly all of them) in this country could care less what Ford gets for a GT500. They only care about what Ford gets from THEM. >> I don't fault the >> dealer for getting the highest price they can command. It is the way >> capitalism works. > > Yes, capitalism in practice is rarely free market. It's about > manipulating markets and creating monopolies really. It's about beating your competition and making your products desirable. >> I will be pissed off at Ford if they don't produce >> the number of units they have stated. > > Which is exactly what will happen as people end up buying something else > because Ford dealers wanted an extra 20 grand. They won't want an extra $20k if the cars are backing up on their lots unsold. IMO, this will happen if Ford makes the number of GT500s they have stated. >> If they don't there is a good >> chance I will not be a Ford only buyer anymore. That is how I will make >> my statement on the matter. ;) > > Then we are in agreement. Finally! ;) >> Absence of a gun to your head is not the definition of a free market. > You're free NOT to pay the asking price. ;) That price isn't being set by free market conditions. >>> The reason the prices are silly right now is there are a few people >>> willing to pay what I consider and outrageous price for the few >>> available cars. >> Didn't I just finish writing that? > So, why blame the dealer for high prices? It is just as much the fault > of the buyer. That's why I called the buyers who paid it morons and idiots. Try to pay attention. >>> Once the dealers wade through these buyers and the cars >>> aren't moving at the current prices they will have to lower the price to >>> get off the inventory. >> Maybe. > If Ford makes enough GT500s this will happen. Doesn't look like they are going to. >>> And there will ultimately be a limited number of GT500s. >> There will ultimately be a limited number of Foci, just as there are a >> limited number of Tempos and Pintos. > You seem to think their is a difference in selling a vintage GT500 > verses a 2007 model. Market forces are the same for both cars. If you > have a problem with a 2007 GT500 selling for $60k then you should have a > problem with a vintage one selling for $100k. Market forces are entirely different for a product that is in production vs. one declared collectable. Any auction house should be able to explain the difference. And yes, I don't think the vintage ones are worth a 100K. And once the baby boomers start dying off they won't be any more. >>> A vintage >>> GT500 falls under the same supply and demand forces as a 2007 GT500. >> No it doesn't by the very fact the 2007 GT500 is in production. There >> will never be another '67 GT500, only less. > They both fall under the same principle of supply and demand. In a few > months there will never be another 2007 GT500, only less. In a year's time you can say that. But there is a free market of vintage cars because they trade hands privately and nobody is controlling supply. Let's say Bob and Frank have identical '67 GT500s. Bob needs money bad, Frank doesn't. Frank is asking a $110K, Bob needs the money sooner and undercuts Frank, you buy Bob's car for $102K. That doesn't happen in the new car game when a dealer just has one or two of a car that has any kind of demand for it and won't get any more. They, like Frank, can just sit and wait until someone will pay what they ask. They don't have to move the cars, they can just let them sit and wait for the payoff. >>> You and I are no different from Ford. We all will take the >>> highest price for whatever item we are selling. >> I would weigh permantly pissing off customers and getting customers to >> look at vehicles from other manufacturers into the equation. I would >> consider those long term losses to be more important than the short term >> gain. But hey, I am not chairman of Ford as it loses billions every >> quarter. The short term thinking seems to be working out well for them >> don't you think? > EVERY dealer does what Ford is doing when they have a super hot limited > production vehicle. It is what every business does when they have a > chance to maximize profits. I do it every chance I get. So you screw over every ignorant customer that walks in your door? Where do you draw the line on maximizing profits? Where's the line? Or is there even a line? > Every time you > accept a raise you do it too. Ford loosing money right now isn't a > result of overcharging for their vehicles. They need desirable > products, IMO. Most people (in fact, nearly all of them) in this > country could care less what Ford gets for a GT500. They only care > about what Ford gets from THEM. My father had a bad chevy once. He didn't get treated well by the chevy dealer either. That was in 1981. He will never buy a GM car again. Since 1981 no matter what GM makes it doesn't matter, won't even walk into the dealership. That's what I am getting at. If you are always seeking to maximize profits now you are going to need a constant supply of new customers to make up for the ones who later learned better or felt you were trying to screw them and walked out the door and bought from someone else. Maximizing profits in the short term carries a great deal of risk for the long term. Unlike you apparently, I would consider that. >>> I don't fault the >>> dealer for getting the highest price they can command. It is the way >>> capitalism works. >> Yes, capitalism in practice is rarely free market. It's about >> manipulating markets and creating monopolies really. > It's about beating your competition and making your products desirable. The beating your competition part is part I was refering to. For example, microsoft's practices. >>> I will be pissed off at Ford if they don't produce >>> the number of units they have stated. >> Which is exactly what will happen as people end up buying something else >> because Ford dealers wanted an extra 20 grand. > They won't want an extra $20k if the cars are backing up on their lots > unsold. IMO, this will happen if Ford makes the number of GT500s they > have stated. If they don't cancel it for it lack of orders. >>> Absence of a gun to your head is not the definition of a free market. > >> You're free NOT to pay the asking price. ;) > > That price isn't being set by free market conditions. Fact is you are free to purchase what you choose that is available in the market. You are also free to start your own car company if you want to compete or supply a product that doesn't currently exist. Whatever point you are attempting to make here, I'm not seeing the relevance to the topic at hand. >>>> The reason the prices are silly right now is there are a few people >>>> willing to pay what I consider and outrageous price for the few [quoted text clipped - 7 lines] > That's why I called the buyers who paid it morons and idiots. Try to pay > attention. I am but you're rather hard to follow. What exactly is your problem with the dealer if the buyer is ultimately responsible for high prices? >>>> Once the dealers wade through these buyers and the cars >>>> aren't moving at the current prices they will have to lower the price to [quoted text clipped - 5 lines] > > Doesn't look like they are going to. I doubt anyone knows the answer to this right now. Not even Ford. >>>> And there will ultimately be a limited number of GT500s. > [quoted text clipped - 10 lines] > the difference. And yes, I don't think the vintage ones are worth a 100K. > And once the baby boomers start dying off they won't be any more. You're having a very hard time understanding the relationship between supply and demand and their effects on pricing. When those baby boomers start dying what happens to demand? What happens to supply? Then what happens to pricing? Get it now? The same thing is happening with the 2007 GT500. High demand for a limited supply means higher prices. Whether it is GT500s, rare paintings, Nike shoes or gasoline the same principle applies. >>>> A vintage >>>> GT500 falls under the same supply and demand forces as a 2007 GT500. [quoted text clipped - 14 lines] > and wait until someone will pay what they ask. They don't have to move > the cars, they can just let them sit and wait for the payoff. What happens if a dealer never lowers the price and the car never sells? Do you think he will sit on the car for 20 years or maybe forever? If there is no buyer for the asking price it won't sell, period. The price will be lowered until a buyer is found. The demand for GT500s will fluctuate over time and so will the price. Everything you stated above involves a seller, a buyer and a demand for the product. Whatever motivates a particular buyer and seller is what sets the price. If the owner of a vintage GT500 lowers the price of his car to $50k when the average market value is, say, $100k then guess what will happen? The demand for HIS car will skyrocket. If enough buyers find out about it then they will push the price up and send it to near the market value. The rules of supply and demand applies to ANYTHING that is sold in a competitive market. >>>> You and I are no different from Ford. We all will take the >>>> highest price for whatever item we are selling. [quoted text clipped - 13 lines] > do you draw the line on maximizing profits? Where's the line? Or is there > even a line? Are you going to turn down your next raise? If not then YOU are maximizing your profits. Why chastise Ford, or any business for that matter, that is doing the same thing you are? Your position seems a little hypocritical to me. It is the dealer's right to apply any marketing strategy they choose to maximize profits. If their methods cost them buyers then they will see a drop in demand for their products. The fact is that the overwhelming majority of car buyers could care less if a given dealer sold a GT500 to some idiot for $100k. All they care about is what Ford is charging THEM. >> Every time you >> accept a raise you do it too. Ford loosing money right now isn't a [quoted text clipped - 7 lines] > 1981 no matter what GM makes it doesn't matter, won't even walk into the > dealership. That's what I am getting at. And by his choice he is ever so slightly effecting the demand for Chevy products. If this occurs with enough buyers then Chevy will see a drop in demand. Not buying a product is the consumer's way of letting their voice be heard. > If you are always seeking to maximize profits now you are going to need a > constant supply of new customers to make up for the ones who later > learned better or felt you were trying to screw them and walked out the > door and bought from someone else. Maximizing profits in the short term > carries a great deal of risk for the long term. Unlike you apparently, I > would consider that. There is one huge fault in your logic here. You are assuming every buyer is dissatisfied with the transaction. Do you think the guy that paid $60k for his 2007 GT500 is pissed off at Ford? I bet he is driving around with a big grin on his face. I bet most people that buy a new car will say they paid a fair price. Why would they buy a new vehicle otherwise? There are too many choices for the consumer in the car/truck market for someone to feel they were overcharged. Once again, supply and demand forces will keep prices in check. >>>> I don't fault the >>>> dealer for getting the highest price they can command. It is the way [quoted text clipped - 7 lines] > The beating your competition part is part I was refering to. For example, > microsoft's practices. If you don't like Microsoft then buy an Apple or use Linux. If Microsoft pisses off enough people then they will loose market share. In the end, it is the consumer that makes or breaks Microsoft or any other company. >>>> I will be pissed off at Ford if they don't produce >>>> the number of units they have stated. [quoted text clipped - 7 lines] > > If they don't cancel it for it lack of orders. That is one of Ford's options. >>>> Absence of a gun to your head is not the definition of a free market. >> [quoted text clipped - 7 lines] > point you are attempting to make here, I'm not seeing the relevance to > the topic at hand. And there might be life on Mars! Which is about as relevant to the topic at hand as your 'point' above. My point, is that this 'it's the free market' defense of dealer market up is not valid. It's not. It's anything but free market competition. If it were free market competition the cars wouldn't be going through dealer allotments. Dealers would actually compete with each other to make sales rather than just wait for suckers. >>> So, why blame the dealer for high prices? It is just as much the fault >>> of the buyer. >> That's why I called the buyers who paid it morons and idiots. Try to pay >> attention. > I am but you're rather hard to follow. Most everyone else seems to follow it. > What exactly is your problem > with the dealer if the buyer is ultimately responsible for high prices? My 'problem' is that people are calling this situation a result of 'free market' forces. It's not. >>> If Ford makes enough GT500s this will happen. >> Doesn't look like they are going to. > I doubt anyone knows the answer to this right now. Not even Ford. "Look like" isn't knowing the answer, it's a projection, a guess. >>>>> And there will ultimately be a limited number of GT500s. >> Market forces are entirely different for a product that is in production >> vs. one declared collectable. Any auction house should be able to explain >> the difference. And yes, I don't think the vintage ones are worth a 100K. >> And once the baby boomers start dying off they won't be any more. > You're having a very hard time understanding the relationship between > supply and demand and their effects on pricing. I understand it very well thank you very much. > When those baby boomers start dying what happens to demand? What > happens to supply? Then what happens to pricing? Get it now? I get it quite well. However that doesn't make 20K profit adders at dealerships the result of a free market. > The same thing is happening with the 2007 GT500. High demand for a > limited supply means higher prices. Have open ordering at all ford dealerships. Order until hitting the limiting production part. Guess what will happen? Prices will fall because people can then go to the dealer down the street that's willing to sell 150 at MSRP vs 1 at 25K over. The market isn't a free one at present. > Whether it is GT500s, rare paintings, Nike shoes or gasoline the same > principle applies. But just it applying doesn't mean it's a 'free' market. > What happens if a dealer never lowers the price and the car never sells? > Do you think he will sit on the car for 20 years or maybe forever? If > there is no buyer for the asking price it won't sell, period. The price > will be lowered until a buyer is found. The demand for GT500s will > fluctuate over time and so will the price. The population of morons with more money than sense is well distributed around the country to ensure that every dealership will be able to find one or two such people. The cars are on _allotment_ that means there's no real competition between dealers because a dealer cannot sell more than his allotment. It changes the dynamic entirely. It's not a free market situation, it's more like communist style rationing. Such rationing always in the end results in shortages and in many cases very high prices. If ford wasn't rationing the production to the dealers, dealers would sell the car freely. Dealer A would try to make money on volume, dealer B might try to sell a couple at way over sticker. There would be competition. Orders could start flooding in and Ford might decide they should dedicate more mustang production to this higher profit margin version. Instead ford rations, and we get something that is the result of central planning. Grasping the difference now? >>> EVERY dealer does what Ford is doing when they have a super hot limited >>> production vehicle. It is what every business does when they have a >>> chance to maximize profits. I do it every chance I get. >> So you screw over every ignorant customer that walks in your door? Where >> do you draw the line on maximizing profits? Where's the line? Or is there >> even a line? > Are you going to turn down your next raise? My salary could double and my employer will still be getting a bargin. > If not then YOU are maximizing your profits. You seem to like asking questions but not answering them. > Why chastise Ford, or any business for that matter, that is doing the > same thing you are? I am chastising the members of this group who think that this is a free market situation because they don't have the brains to realize that rationing isn't free market. And if you ask me, maximizing profit would be selling this car at MSRP to everyone who will buy it at this price. Maximum profit isn't at maximum price. It's a clever balance of volume and price and to the competition. But obviously your mind can't grasp it any deeper than the simplistic get more per unit now mentality. > Your position seems a > little hypocritical to me. It is the dealer's right to apply any > marketing strategy they choose to maximize profits. If their methods > cost them buyers then they will see a drop in demand for their products. Good for them, and if this was a free market situation things would be different. Instead we are dealing with a rationed product. > The fact is that the overwhelming majority of car buyers could care > less if a given dealer sold a GT500 to some idiot for $100k. All they > care about is what Ford is charging THEM. The overwhelming majority of car buyers wouldn't give a rats a.s about anything a ford dealer has or what it was priced at.... You seem to enjoy introducing things that have about as much relevance as what killed the dinosaurs. >> If you are always seeking to maximize profits now you are going to need a >> constant supply of new customers to make up for the ones who later >> learned better or felt you were trying to screw them and walked out the >> door and bought from someone else. Maximizing profits in the short term >> carries a great deal of risk for the long term. Unlike you apparently, I >> would consider that. > There is one huge fault in your logic here. You are assuming every > buyer is dissatisfied with the transaction. Do you think the guy that [quoted text clipped - 4 lines] > market for someone to feel they were overcharged. Once again, supply > and demand forces will keep prices in check. So it's ok to screw people if they don't know any better in your view. Glad I had that right. When the buyer wakes up when the interior wears like a V6 mustang's he's going to think he got screwed.... But if you understood that then you wouldn't have replied as above. >>>> Yes, capitalism in practice is rarely free market. It's about >>>> manipulating markets and creating monopolies really. >>> It's about beating your competition and making your products desirable. >> The beating your competition part is part I was refering to. For example, >> microsoft's practices. > If you don't like Microsoft then buy an Apple or use Linux. If > Microsoft pisses off enough people then they will loose market share. > In the end, it is the consumer that makes or breaks Microsoft or any > other company. You don't get it. Microsoft to PC builder: If you offer Linux we won't sell windows to you and you'll lose most of your business. Get it now? Probably not. You probably consider that an ethical business practice to maximize profit. >>>>> Absence of a gun to your head is not the definition of a free market. >>> [quoted text clipped - 14 lines] > allotments. Dealers would actually compete with each other to make sales > rather than just wait for suckers. The market price of any Ford vehicle is virtually unaffected by dealer allotments. The allotment system for popular vehicles is Ford's way of rewarding certain dealers for their performance and not as a way of controlling prices. The price is set by what the consumer is willing to pay. You are applying the free market definition to a very specific company and a very narrow circumstance. You are not obliged to buy a GT500. You have the ability to choose a Corvette, Mercedes, BMW or any other car you choose as a substitute if you aren't willing to pay a dealer's price. This is the free market, or supply and demand, forces at play that really sets the price of a GT500. You need to take off your blinders and see the entire playing field. Then you might see how supply and demand, along with the dealer's, and Ford's, right to maximize profits is determining the price of the GT500. This isn't a rare case. It happens with nearly every item we purchase. >>>> So, why blame the dealer for high prices? It is just as much the fault >>>> of the buyer. [quoted text clipped - 5 lines] > > Most everyone else seems to follow it. Have you read all the posts in this thread? >> What exactly is your problem >> with the dealer if the buyer is ultimately responsible for high prices? > > My 'problem' is that people are calling this situation a result of 'free > market' forces. It's not. See above. >>>> If Ford makes enough GT500s this will happen. > [quoted text clipped - 3 lines] > > "Look like" isn't knowing the answer, it's a projection, a guess. And just how do you know enough to even remotely use the term "looks like"? I know I don't know enough to use it. All I know is what they have stated. >>>>>> And there will ultimately be a limited number of GT500s. > [quoted text clipped - 7 lines] > > I understand it very well thank you very much. OK. If you say so. >> When those baby boomers start dying what happens to demand? What >> happens to supply? Then what happens to pricing? Get it now? > > I get it quite well. However that doesn't make 20K profit adders at > dealerships the result of a free market. See my first response above. I'm getting tired of explaining it. The free market extends way beyond Ford and its dealer network. >> The same thing is happening with the 2007 GT500. High demand for a >> limited supply means higher prices. [quoted text clipped - 4 lines] > to sell 150 at MSRP vs 1 at 25K over. The market isn't a free one at > present. And you are free to scour the country looking for a deal on a GT500 too. What's the difference? The pricing for both vehicles are effected by free market forces and the dealer's, and Ford's, right to maximize profits. Just like it is with every other item you buy, such as toothpaste. >> Whether it is GT500s, rare paintings, Nike shoes or gasoline the same >> principle applies. > > But just it applying doesn't mean it's a 'free' market. You have a real mental block on this. >> What happens if a dealer never lowers the price and the car never sells? >> Do you think he will sit on the car for 20 years or maybe forever? If [quoted text clipped - 9 lines] > situation, it's more like communist style rationing. Such rationing > always in the end results in shortages and in many cases very high prices. It's SUPPLY AND DEMAND!!! Dealers don't have to compete right now because the demand is far outstripping the supply!!! Allotment has nothing to do with it. Communist style rationing?!?!? You are way off the reservation now. Maybe that would be true if the only choice we had was buying GT500s from Ford. > If ford wasn't rationing the production to the dealers, dealers would > sell the car freely. Dealer A would try to make money on volume, dealer B [quoted text clipped - 5 lines] > > Grasping the difference now? You need to stop looking at this in a microcosm. The free market goes way beyond Ford and its network of dealers. You are free to buy what ever car make and model you choose and there are a multitude to choose from. That is how the free market, along with Ford's and the dealer's right to make a profit, is setting the price of the GT500. Are you grasping the concept now? >>>> EVERY dealer does what Ford is doing when they have a super hot limited >>>> production vehicle. It is what every business does when they have a [quoted text clipped - 7 lines] > > My salary could double and my employer will still be getting a bargin. That is YOUR opinion. Others may not agree. Just like you don't agree with the value dealers put on a GT500. I guess you aren't going to let your employer reduce your salary if he thinks you are overpaid? >> If not then YOU are maximizing your profits. > > You seem to like asking questions but not answering them. Sometimes a question is really an answer. >> Why chastise Ford, or any business for that matter, that is doing the >> same thing you are? [quoted text clipped - 6 lines] > and price and to the competition. But obviously your mind can't grasp it > any deeper than the simplistic get more per unit now mentality. As I stated above, you need to see the broad picture to understand the free market is at play here. Ford has every right to operate in whatever way they think is best. They also have every right to go bankrupt if they choose wrong. It happens in a free market. How do you know they are wrong with their handling of the GT500? I don't have access to their accounting records. Do you? >> Your position seems a >> little hypocritical to me. It is the dealer's right to apply any [quoted text clipped - 3 lines] > Good for them, and if this was a free market situation things would be > different. Instead we are dealing with a rationed product. You do realize there is far more to a free market than just Ford's internal functions? >> The fact is that the overwhelming majority of car buyers could care >> less if a given dealer sold a GT500 to some idiot for $100k. All they [quoted text clipped - 4 lines] > introducing things that have about as much relevance as what killed the > dinosaurs. Didn't you say that Ford's way of handling the GT500 would alienate buyers and their loyal customer base? In case you forgot here's what you typed previously: "I would weigh permantly pissing off customers and getting customers to look at vehicles from other manufacturers into the equation. I would consider those long term losses to be more important than the short term gain. But hey, I am not chairman of Ford as it loses billions every quarter. The short term thinking seems to be working out well for them don't you think?" Maybe that was someone else. >>> If you are always seeking to maximize profits now you are going to need a >>> constant supply of new customers to make up for the ones who later [quoted text clipped - 16 lines] > like a V6 mustang's he's going to think he got screwed.... But if you > understood that then you wouldn't have replied as above. The buyer has no obligation to educate himself before heading out to a dealer to purchase a car? Nothing is keeping him from buying a Mercedes if he is concerned about the wear of the interior of a GT500. Just how is Ford, or a dealer, "screwing" any buyer of a GT500 when it is their choice to buy the car? I'm sure the first time a GT500 buyer plants the accelerator to the floor he will realize just why he paid that price premium. Last thing on his mind will be, "I wonder how well this interior will wear?" >>>>> Yes, capitalism in practice is rarely free market. It's about >>>>> manipulating markets and creating monopolies really. [quoted text clipped - 10 lines] > > You don't get it. This, evidently, is where you and I have much in common. > Microsoft to PC builder: If you offer Linux we won't sell windows to you > and you'll lose most of your business. Wouldn't have anything to do with the consumer preferring Windows as an operating system? Besides Microsoft got their hands slapped for this little escapade. How does this relate to Ford and their dealers selling GT500s? I don't see them setting up a sports car monopoly. > Get it now? Probably not. You probably consider that an ethical business > practice to maximize profit. Don't forget to donate that next raise you get to the Red Cross. We wouldn't want to think you are greedy now, would we? ;) > The market price of any Ford vehicle is virtually unaffected by dealer > allotments. Rationing affects market price. > The allotment system for popular vehicles is Ford's way of > rewarding certain dealers for their performance and not as a way of > controlling prices. The price is set by what the consumer is willing to > pay. Yes, it rewards the dealers by rationing the goods which increases their price and dealer profit should the dealer do so. If the cars were not rationed, the dealers that sold at MSRP would drive down the market price. But since they are rationed, the MSRP selling dealerships run through their allotments quickly allowing the others to add 20K to the sticker. > You are applying the free market definition to a very specific company > and a very narrow circumstance. Let's see, you and others are telling me it's the free market and I should love it. It's not a free market situation. It's a rationing situation. > You are not obliged to buy a GT500. I haven't stated otherwise and I am growing quite tired at this continual sidetrack of yours. That doesn't change the fact that the additional profit dealers are tacking on does not come from a free market situation. > You have the ability to choose a Corvette, Mercedes, BMW or any other > car you choose as a substitute if you aren't willing to pay a dealer's > price. And that's likely what will happen. > This is the free market, or supply and demand, forces at play > that really sets the price of a GT500. But there is no free market between _independently owned_ Ford dealers. > You need to take off your > blinders and see the entire playing field. I see the whole field thank you very much. Could you please stop constructing this strawman? > Then you might see how > supply and demand, along with the dealer's, and Ford's, right to > maximize profits is determining the price of the GT500. This isn't a > rare case. It happens with nearly every item we purchase. Ford isn't maximizing anything but their losses. MSRP is where _FORD_ thinks it will _MAXIMIZE_ it's profits. If Ford thought that maximium profits were at $65K, that's what MSRP would be. Then again look who I am discussing this with, someone who thinks highest unit price is always maximum profit. It's not. <snip, unread> >> The market price of any Ford vehicle is virtually unaffected by dealer >> allotments. > > Rationing affects market price. You're all over the map. Rationing? WTH are you talking about? This isn't 1942. >> The allotment system for popular vehicles is Ford's way of >> rewarding certain dealers for their performance and not as a way of [quoted text clipped - 7 lines] > through their allotments quickly allowing the others to add 20K to the > sticker. And this is how ford chooses to operate... IN A FREE MARKET!!! Ford is not THE market. It is a competitor in the market place. >> You are applying the free market definition to a very specific company >> and a very narrow circumstance. > > Let's see, you and others are telling me it's the free market and I > should love it. It's not a free market situation. It's a rationing > situation. Your first clue that you are wrong is in your above statement. We are all wrong and you are right? Is rationing your new buzz word? What was wrong with allotment? Do you expect Ford to market the GT500 like it does an F150? >> You are not obliged to buy a GT500. > > I haven't stated otherwise and I am growing quite tired at this continual > sidetrack of yours. That doesn't change the fact that the additional > profit dealers are tacking on does not come from a free market situation. You say there is no free market and I have thoroughly explained that there is. What is the side track? You do realize Ford operates in a free market here and has many competitors for all their makes and models? You think Toyota doesn't maximize profits too. I know the owner of three Toyota dealerships personally and I can confirm that he does. They all do it and it is done in a free market. No one dealer or automaker is the free market on there own. I just don't see what is so difficult in grasping this concept. >> You have the ability to choose a Corvette, Mercedes, BMW or any other >> car you choose as a substitute if you aren't willing to pay a dealer's >> price. > > And that's likely what will happen. You realize you are part of the free market at work, don't you? >> This is the free market, or supply and demand, forces at play >> that really sets the price of a GT500. > > But there is no free market between _independently owned_ Ford dealers. And Ford and its dealers don't constitute a free market on their own. They are one part of the overall free market system. >> You need to take off your >> blinders and see the entire playing field. > > I see the whole field thank you very much. Could you please stop > constructing this strawman? Straw man? What are you talking about now? Every time you get boxed into a corner you play the "straw man" card. The only straw man here is you claiming Ford and its dealers can, and should, operate as a free market internally. >> Then you might see how >> supply and demand, along with the dealer's, and Ford's, right to [quoted text clipped - 4 lines] > thinks it will _MAXIMIZE_ it's profits. If Ford thought that maximium > profits were at $65K, that's what MSRP would be. You are once again assuming to know way more than you actually do. Neither of us know what combination of sales price and volume will maximize profits. I doubt Ford even knows it until the dust settles. Ford has decided to sell X number of cars to the dealers for Y price. They can compute their profits based on these numbers. The dealers are now trying to maximize their profits by probing the market place with prices they think will fly based on the current demand. MSRP means nothing to a dealer right now for the GT500. It is what Ford has stated is their belief of the car's market value. This isn't based on the initial demand but over the entire year's production and anticipated total demand for the car. You make Ford out to be some evil corporation ripping off its customers when they are just like every other auto maker. I guess a reasonable profit is OK as long as it meets your idea of reasonable? > Then again look who I am discussing this with, someone who thinks highest > unit price is always maximum profit. It's not. There you go again, assuming you know way more than you actually do. Where in this thread have I stated what you just claimed? I took enough economics courses in college to know the relationship between price, product quantity, demand and profit. Plus I have owned two businesses selling goods and services in a competitive market so I know a little about their combined effect on profits. BTW, I was looking forward to your rationalization of how you maximizing your income shouldn't be considered an act of greed on your part. I thought it might give me some insight regarding why you think dealers are greedy for maximizing their profits and you, OTOH, are not when maximizing your income. >>> The market price of any Ford vehicle is virtually unaffected by dealer >>> allotments. [quoted text clipped - 3 lines] > You're all over the map. Rationing? WTH are you talking about? This > isn't 1942. Allotments are a form of rationing. Dammit grow a clue. >>> The allotment system for popular vehicles is Ford's way of >>> rewarding certain dealers for their performance and not as a way of [quoted text clipped - 7 lines] >> through their allotments quickly allowing the others to add 20K to the >> sticker. > And this is how ford chooses to operate... IN A FREE MARKET!!! Ford is > not THE market. It is a competitor in the market place. Walmart, Kmart, and Target sell the same products. All these products have various list prices (MSRPs). In a free market they compete with each other. Why shouldn't BillyBob's Ford vs. dingleville Ford vs. Shelbyville AutoMall compete with each other? >>> You are applying the free market definition to a very specific company >>> and a very narrow circumstance. >> Let's see, you and others are telling me it's the free market and I >> should love it. It's not a free market situation. It's a rationing >> situation. > Your first clue that you are wrong is in your above statement. We are > all wrong and you are right? We being you and the voices in your head? > Is rationing your new buzz word? What was wrong with allotment? Because when I used allotment you couldn't figure it out. So I used a term closer to the economic model being followed. > Do you expect Ford to market the GT500 like it does an F150? If they want to maximize profits. >>> You are not obliged to buy a GT500. >> I haven't stated otherwise and I am growing quite tired at this continual >> sidetrack of yours. That doesn't change the fact that the additional >> profit dealers are tacking on does not come from a free market situation. > You say there is no free market and I have thoroughly explained that > there is. You haven't shown anything of the sort. > What is the side track? The sidetrack is your insulting crap about not knowing I could choose a non-ford product. > You do realize Ford operates in a > free market here and has many competitors for all their makes and > models? You're not grasping it and are choosing to be insulting rather than figure it out. Another example: Circuit City and Best Buy compete selling Sony TVs. Sure you chould choose to buy one made by Sharp, but these retailers still compete to sell Sonys. That's why the GT500 isn't a free market, but one with rationing (allotment). Billybob Ford isn't competing with Shelbyville AutoMall because of the rationing. > You think Toyota doesn't maximize profits too. I know the > owner of three Toyota dealerships personally and I can confirm that he > does. They all do it and it is done in a free market. No one dealer or > automaker is the free market on there own. I just don't see what is so > difficult in grasping this concept. Toyota dealers don't compete with each other? If dealers aren't to compete with each other they should become owned by the manufacturer. >>> You have the ability to choose a Corvette, Mercedes, BMW or any other >>> car you choose as a substitute if you aren't willing to pay a dealer's >>> price. >> And that's likely what will happen. > You realize you are part of the free market at work, don't you? But it isn't your ideal free market setting the price of GT500s, because BMW and Chevy dealers will be competing with each other to sell the cars of interest they are selling. Meanwhile, Ford is playing allotments. >>> This is the free market, or supply and demand, forces at play >>> that really sets the price of a GT500. >> But there is no free market between _independently owned_ Ford dealers. > And Ford and its dealers don't constitute a free market on their own. > They are one part of the overall free market system. Dealerships are independently owned businesses. They compete with each other the same way Walmart and Target compete with each other selling colgate toothpaste and whole host of other identical products. Your argument above would only make sense if they were owned by Ford. >>> You need to take off your >>> blinders and see the entire playing field. >> I see the whole field thank you very much. Could you please stop >> constructing this strawman? > Straw man? What are you talking about now? Every time you get boxed > into a corner you play the "straw man" card. The strawman being that I am not seeing the entire field. You keep harping on this and knocking it down and I am rather sick of it. > The only straw man here is > you claiming Ford and its dealers can, and should, operate as a free > market internally. Have I stated that? I stated that they aren't operating as a free market with the _independently owned_ dealers. The dealerships are not internal to ford. They are not owned by ford. They are independent businesses and are free to stop selling fords and/or start selling chevys or Ladas or toyotas or whatever they want to. I've seen some interesting dealerships... like a Chevy and Mazda dealership. Same company sold Chevys and they sold Mazdas on the same property with the same salesmen. That's just like Best Buy selling Sony and Sharp TVs in the same isle. Dealers are _RETAILERS_ They are not owned or operated by the manufacturer. Manufacturers try to control retailers as I am sure you'll be quick to point out, have little control over dealer pricing. Because the supply of product is not following free market principles, the retailers can charge more for it due to the artifical scaricity created by not following a free market system but rather using a rationing system. >>> Then you might see how >>> supply and demand, along with the dealer's, and Ford's, right to >>> maximize profits is determining the price of the GT500. This isn't a >>> rare case. It happens with nearly every item we purchase. >> Ford isn't maximizing anything but their losses. MSRP is where _FORD_ >> thinks it will _MAXIMIZE_ it's profits. If Ford thought that maximium >> profits were at $65K, that's what MSRP would be. > You are once again assuming to know way more than you actually do. > Neither of us know what combination of sales price and volume will > maximize profits. I doubt Ford even knows it until the dust settles. I didn't assume anything. MSRP is where the manufacture _THINKS_ maximium profit point is. It's clear you aren't reading what I write at all, but skimming a few words and inserting what you wished I had written instead. > Ford has decided to sell X number of cars to the dealers for Y price. > They can compute their profits based on these numbers. The dealers are [quoted text clipped - 4 lines] > initial demand but over the entire year's production and anticipated > total demand for the car. > You make Ford out to be some evil corporation > ripping off its customers when they are just like every other auto > maker. I haven't done any such thing. Here you go again making up strawmen. > I guess a reasonable profit is OK as long as it meets your idea > of reasonable? Made no such argument. Why don't you go f.ck yourself? Seriously, I grow tired of this continual line of sh.t from you. You just make up one thing after another to force me to deal with these stupid tangents. >> Then again look who I am discussing this with, someone who thinks highest >> unit price is always maximum profit. It's not. > There you go again, assuming you know way more than you actually do. > Where in this thread have I stated what you just claimed? You've stated that clearly several times. > I took enough > economics courses in college to know the relationship between price, > product quantity, demand and profit. Then act like it. > Plus I have owned two businesses > selling goods and services in a competitive market so I know a little > about their combined effect on profits. You've sounded like some who feels happy screwing customers so long as they don't realize it right away because that's maximum profit per unit. > BTW, I was looking forward to your rationalization of how you maximizing > your income shouldn't be considered an act of greed on your part. I > thought it might give me some insight regarding why you think dealers > are greedy for maximizing their profits and you, OTOH, are not when > maximizing your income. I'm sorry, I am not falling for your side distractions and easy to knock down strawmen. The fact remains, GT500 pricing is _NOT_ the result of a free market situation of supply. It's a result of rationed supply. If my 'raise' is too much, free market allows them to hire another engineer and fire me. There isn't an allotment of engineers to chicago, they can encourage someone from WI or even China to come in and work for less. Now if there were an allotment of engineers for the Chicago area, my price would skyrocket because there would likely be too few of us here, but too many in Montana. But that wouldn't be a free market, now would it? For instance, say that lumber is needed more in one area of the country. Lumber prices there will increase and product will be diverted to that area as lumber mills try to maximize their profits by diverting from other regional markets. This would stablize and bring down prices in the region of high demand. But lets say lumber mills stayed true to a distribution scheme and that area got what they were set to get and not a bit more. Prices would sky rocket for lumber in that area of the nation. Going higher and higher and not stablizing because product isn't being sent to try and satisify demand. That's what happens under allotment/rationing schemes. This ration, not a bit more or less. Lumber sits unsold in Chicago but meanwhile in New Orleans housing repair costs skyrocket for a lack of lumber. That's how allotment markets work, sky high prices where the allotment isn't enough. Sure, lumber dealers in New Orleans maximize their profit per unit, but are they really maximizing their overall profit? How about the mills? Now exactly how is Ford delivering more GT500s to meet demand and maximize it's profits? It's not. It's sticking to an allotment scheme and prices are skyrocketing at the retailer. It's the direct opposite of a free market where Ford would be encouraged to build more and deliver them to where they are selling. It's system of rewarding dealerships is causing it to act _NOT_ to maximize it's profits. Look, your head is full of concrete on this matter so let's just agree to disagree and move on. > Look, your head is full of concrete on this matter so let's just agree > to disagree and move on. In other words, you finally figured it out... You won't admit your wrong..............so just get on with life. > > Look, your head is full of concrete on this matter so let's just agree > > to disagree and move on. > > In other words, you finally figured it out... > You won't admit your wrong..............so just get on with life. ok smart guy... you splain how independently owned ford dealers aren't supposed to compete with one another. >> Look, your head is full of concrete on this matter so let's just agree >> to disagree and move on. > > In other words, you finally figured it out... Yeah, I did....... the part about your head being full of concrete. >> The market price of any Ford vehicle is virtually unaffected by dealer >> allotments. > >Rationing affects market price. And the Company is 100% "FREE" to do this as a marketing strategy. A way to get more customers into the showroom. The GT500 is a specialty vehicle, not a regular production vehicle. Hence it is made in limited numbers, made for a limited audience. At its price-point it would not sell well nor be cost effective to mass produce. Ford set a MSRP on it that the free market is driving up by its demand, which if Ford wanted to maximize their profit on could ramp up production for. However, if they did they may over produce and be left with cars sitting on dealers lots that have to be discounted in order to be sold. >> The allotment system for popular vehicles is Ford's way of >> rewarding certain dealers for their performance and not as a way of [quoted text clipped - 7 lines] >through their allotments quickly allowing the others to add 20K to the >sticker. Ford, could constrain the end-dealers and require them to sell at MSRP. However, all that would mean is that the secondary market would re-channel the vehicles at the substantial marketup. Therefore the price marketups would still happen because of supply & demand. Don't tell me if you were able to buy one at sticker and I offered you $25k more you wouldn't re-sell it. Capitalism at its finest hour. >> You are applying the free market definition to a very specific company >> and a very narrow circumstance. > >Let's see, you and others are telling me it's the free market and I >should love it. It's not a free market situation. It's a rationing >situation. Ok it is rationing, you happy now? A free market is a market where price is determined by unregulated supply and demand; the opposite is a controlled market, where supply, demand, and price are set by a government. According to a more philosophical definition, a "free" market is a market where trades are morally voluntary and therefore free from the interference of force and fraud. The notion of a free market is closely associated with laissez-faire economic philosophy, which advocates approximating this condition in the real world by mostly confining government intervention in economic matters to regulating against force and fraud among market participants. Hence, with government force limited to a defensive role, government itself does not initiate force in the marketplace beyond levying taxes in order to fund the maintenance of the free marketplace. A few extreme free market advocates oppose even taxation. Now explain to me how the government is collusion with Ford to control the supply of GT500's? -- You can run, but you'll only die tired. ZombyWoof >>> The market price of any Ford vehicle is virtually unaffected by dealer >>> allotments. >> >>Rationing affects market price. > And the Company is 100% "FREE" to do this as a marketing strategy. Never said they weren't. You folks sure like dragging in tangents and justifications. None of these tangents or justifications change the artifical scarcity into an ideal free market. <more tangents and justifications deleted> > Now explain to me how the government is collusion with Ford to control > the supply of GT500's? Now explain to me how the aliens control George Bush? It seems you all now understand my point, know it's true but are pulling anything and everything you can out of your a.ses to hope to 'win'. Problem I agree ford is free to do so, I agree we can all choose something else, etc etc and so forth. But the fact remains, this isn't a free market model when retailers are not competing with each other. >>>> The market price of any Ford vehicle is virtually unaffected by dealer >>>> allotments. [quoted text clipped - 19 lines] >something else, etc etc and so forth. But the fact remains, this isn't a >free market model when retailers are not competing with each other. But you aren't anywhere near close to what the definition of what a "Free Market" is in either a demand or command economy so what is your point? -- You can run, but you'll only die tired. ZombyWoof > But you aren't anywhere near close to what the definition of what a > "Free Market" is in either a demand or command economy so what is your > point? If you don't understand it by now, you're a hopeless moron. > can get". You have to remember that it isn't Ford that is setting the > market price, it is the market itself. I am so tired of that saying.... the markets are often manipulated, and the GT500 can be used as a text book study of market manipulation and artificial scarcity. > If that dealer is able to move > the one it has at $70k it will try to move the next one it gets at > $70k. I don't know how much the dealers are paying for the cars when > they but them from Ford, but it is safe to assume somewhere less then > sticker price. When each dealer gets one or two, they can up the price a great deal and wait for a sucker, the abberation of an uninformed buyer. Not only that, but it's not like the dealer down the street or the next town over can bring the price down. He's only got a couple to sell too, so even if he sells them at sticker, the first dealer can still wait for a sucker or someone with more money than sense and wants it now. Ideal free market conditions would have another dealer being able to come in and supply more cars at a lower price to undercut the dealers charging $20K over sticker. Ford controls the supply of cars without regard to what dealers are charging and thusly the market isn't free. $65K isn't the price a free market will bear, but rather the maximum price a manipulated market can be pushed to. This isn't free market setting the price, it's market manipulation and artificial scarcity in action. The market is being controlled to create conditions that increase prices rather than the ideal free market setting of the price. >> can get". You have to remember that it isn't Ford that is setting the >> market price, it is the market itself. [quoted text clipped - 15 lines] >sells them at sticker, the first dealer can still wait for a sucker or >someone with more money than sense and wants it now. That is the textbook definition of supply & demand. >Ideal free market conditions would have another dealer being able to come >in and supply more cars at a lower price to undercut the dealers charging >$20K over sticker. Ford controls the supply of cars without regard to >what dealers are charging and thusly the market isn't free. $65K isn't >the price a free market will bear, but rather the maximum price a >manipulated market can be pushed to. Again supply & demand. There is only one source of supply for the dealers, Ford and one source of supply for the end-consumers, the dealers. Ford has for a multitude of reasons decided to keep the supply of that particular car constrained in order to keep demand at a point where the price won't get eroded. It is a specialty vehicle after all. No one requires it, only wants it. >This isn't free market setting the price, it's market manipulation and >artificial scarcity in action. The market is being controlled to create >conditions that increase prices rather than the ideal free market setting >of the price. The market always has a choice to reject any non life essential product that is placed into it. What makes a market free is its ability to demand or reject products placed into it. No one is forced to buy GT500's at any price. -- You can run, but you'll only die tired. ZombyWoof > That is the textbook definition of supply & demand. The textbook doesn't have supply being manipulated. > Again supply & demand. There is only one source of supply for the > dealers, Ford and one source of supply for the end-consumers, the > dealers. Ford has for a multitude of reasons decided to keep the > supply of that particular car constrained in order to keep demand at a > point where the price won't get eroded. It is a specialty vehicle > after all. No one requires it, only wants it. So you're fine with market manipulations. You must enjoy $3.20/gallon gasoline then. After all, there are just so many companies with gasoline and they decide how to sell it, how to distribute it, how much to make, wether to maintain their pipelines or not. We don't need gasoline either, we can use other forms of transporation that aren't as enjoyable just we could use a beat up '92 Tempo instead of a '07 GT500. Ford can keep playing these games they are free to do so, but as we see here, it's turning off it's most loyal customer base. Part of the reason they are sh.tter no doubt. Don't try to justify this pricing with free market reasoning when it is anything but a free market situation. >>This isn't free market setting the price, it's market manipulation and >>artificial scarcity in action. The market is being controlled to create >>conditions that increase prices rather than the ideal free market setting >>of the price. > The market always has a choice to reject any non life essential > product that is placed into it. What makes a market free is its > ability to demand or reject products placed into it. No one is forced > to buy GT500's at any price. And as we see, people are rejecting it and rejecting Ford (at least for the short term) as a result. But don't give me and any of the others who find this practice objectionable a line of crap that it's the free market and we have to love it. It's not free market, it's marketing. >> That is the textbook definition of supply & demand. > >The textbook doesn't have supply being manipulated. Supply in a demand economy is always manipulated by the supplier. Only in a command economy are their external forces (government oversight or quotas) placed on the supplier. It is only one of many ways that the supplier has to ensure that they price for their products stay at a price point. Supply & demand also dictates that when there is not enough supply to meet demand another supplier is free to enter the marketplace. >> Again supply & demand. There is only one source of supply for the >> dealers, Ford and one source of supply for the end-consumers, the [quoted text clipped - 9 lines] >we can use other forms of transporation that aren't as enjoyable just we >could use a beat up '92 Tempo instead of a '07 GT500. No one is manipulating the market for pony cars. Your to wrapped around the axle about a specific product from a specific manufacturer in a demand economy. You miss the point of we don't need gasoline as in we could use alternative fuels. A person who doesn't want to pony up the going price for a GT500 could go with a different comparable vehicle from a different manufacturer. Its the idiots who just have to have that first `07 GT500 who will pay for it regardless of the price. >Ford can keep playing these games they are free to do so, but as we see >here, it's turning off it's most loyal customer base. Part of the reason >they are sh.tter no doubt. Nah you are talking about one spaciality vehicle. The reason they are in the sh.tter is because they are bringing out an entire line of vehicles across all price points that are creating the same level of interest as just this one is within a specific group of people. My Pops could care less about an `07 GT500. >Don't try to justify this pricing with free market reasoning when it is >anything but a free market situation. Actually a true free market has to do about tariffs and such so the whole discussion is hogwash. >>>This isn't free market setting the price, it's market manipulation and >>>artificial scarcity in action. The market is being controlled to create [quoted text clipped - 10 lines] >find this practice objectionable a line of crap that it's the free market >and we have to love it. It's not free market, it's marketing. Of course it is part of marketing. Well sir you can't afford this top of the line drool over model, but perhaps I could interest you in this look a like base Mustang model. You can't drive the GT500 at its top performance levels anyhow so why worry about the fact that your not rich or famous enough. -- You can run, but you'll only die tired. ZombyWoof can't afford it? clone it >>> That is the textbook definition of supply & demand. >> >>The textbook doesn't have supply being manipulated. > Supply in a demand economy is always manipulated by the supplier. Not in a free market. In a free market other suppliers step in. > Only in a command economy are their external forces (government > oversight or quotas) placed on the supplier. It is only one of many > ways that the supplier has to ensure that they price for their > products stay at a price point. Supply & demand also dictates that > when there is not enough supply to meet demand another supplier is > free to enter the marketplace. Yet, other ford dealers can't enter the marketplace and undercut those adding 20 grand to price because of ford's allotment set up. Not a free market. >>So you're fine with market manipulations. You must enjoy $3.20/gallon >>gasoline then. After all, there are just so many companies with gasoline >>and they decide how to sell it, how to distribute it, how much to make, >>wether to maintain their pipelines or not. We don't need gasoline either, >>we can use other forms of transporation that aren't as enjoyable just we >>could use a beat up '92 Tempo instead of a '07 GT500. > No one is manipulating the market for pony cars. I didn't say anyone was. Any more than you're saying spacemen are telling you what to post. > Your to wrapped > around the axle about a specific product from a specific manufacturer > in a demand economy. Not at all. > You miss the point of we don't need gasoline as in we could use > alternative fuels. I already posted nobody needs gasoline. > A person who doesn't want to pony > up the going price for a GT500 could go with a different comparable > vehicle from a different manufacturer. Its the idiots who just have > to have that first `07 GT500 who will pay for it regardless of the > price. It's quite clear what I am saying is beyond your grasp. >>Ford can keep playing these games they are free to do so, but as we see >>here, it's turning off it's most loyal customer base. Part of the reason >>they are sh.tter no doubt. > Nah you are talking about one spaciality vehicle. The reason they are > in the sh.tter is because they are bringing out an entire line of > vehicles across all price points that are creating the same level of > interest as just this one is within a specific group of people. My > Pops could care less about an `07 GT500. Their general practices across the board. Each year they lose more of what would be repeat buyers and they aren't bringing in new ones. >>Don't try to justify this pricing with free market reasoning when it is >>anything but a free market situation. > Actually a true free market has to do about tariffs and such so the > whole discussion is hogwash. Free market is not the neo-con definition where everything comes to the US from china and mexico tariff free. >>> The market always has a choice to reject any non life essential >>> product that is placed into it. What makes a market free is its >>> ability to demand or reject products placed into it. No one is forced >>> to buy GT500's at any price. >>And as we see, people are rejecting it and rejecting Ford (at least for >>the short term) as a result. But don't give me and any of the others who >>find this practice objectionable a line of crap that it's the free market >>and we have to love it. It's not free market, it's marketing. > Of course it is part of marketing. Well sir you can't afford this top > of the line drool over model, but perhaps I could interest you in this > look a like base Mustang model. You can't drive the GT500 at its top > performance levels anyhow so why worry about the fact that your not > rich or famous enough. Are you trying to make a lame example of a car salesman or being insulting? > Yet, other ford dealers can't enter the marketplace and undercut those > adding 20 grand to price because of ford's allotment set up. Not a free > market. Any Ford dealer that has a GT500 can choose to undercut the other dealers if they wish. They could sell their car for $1 if they wanted. I think a distinction needs to be made here, and I can wrap it up in a plain manner. There are a fixed number of cars available to the public. It is irrelevant that some dealerships don't get any GT500's as the number of cars on the market is the same whether 100 dealers have them, or 500 dealers. The net effect on the price of the car is still basically the same. There is still price competition between dealers. In this case, the price competition is between all dealerships that get GT500's. Each dealership is going to try for the highest price they can get without losing the sale to another dealership. Basically all they need to decide is how long they want to sit on the car to wait for the buy with the big wallet. You are trying to imply that price/dealer competition no longer takes place, and that clearly isn't the case. Once the initial surge in demand is satisfied, the price will drop even though the number of dealers getting the cars will not increase. -Stresa >> Yet, other ford dealers can't enter the marketplace and undercut those >> adding 20 grand to price because of ford's allotment set up. Not a free >> market. > > Any Ford dealer that has a GT500 can choose to undercut the other dealers if they > wish. They could sell their car for $1 if they wanted. Of course... but they would run out of their allotment of a couple and it would have no effect on market price. I am sorry I didn't repeat the whole thing in every instance. > I think a distinction needs to be made here, and I can wrap it up in a plain > manner. There are a fixed number of cars available to the public. Fixed number? Where did you hear that? What's the number? > It is irrelevant that some dealerships don't get any GT500's All dealerships get some... real the allotment plan that go leaked. > There is still price competition between dealers. In this case, the price > competition is between all dealerships that get GT500's. Each dealership is going > to try for the highest price they can get without losing the sale to another > dealership. Basically all they need to decide is how long they want to sit on the > car to wait for the buy with the big wallet. The distribution being so thin they aren't going to lose a sale to another dealership. They might have to come down to find the buyer willing to pay the second highest amount or something like that, but that's the only way they 'lose' when their competition can't order more. > You are trying to imply that price/dealer competition no longer takes place, and > that clearly isn't the case. Once the initial surge in demand is satisfied, the > price will drop even though the number of dealers getting the cars will not > increase. I would replace 'once' with 'if'. If the lower priced dealer can order more then at that time, retailer competition will exist. Until then a dealer isn't losing anything significant by being priced 'too high'. >>> Yet, other ford dealers can't enter the marketplace and undercut those >>> adding 20 grand to price because of ford's allotment set up. Not a free >>> market. Stresa Wrote: >> Any Ford dealer that has a GT500 can choose to undercut the other dealers if >> they >> wish. They could sell their car for $1 if they wanted. > Of course... but they would run out of their allotment of a couple and it > would have no effect on market price. I am sorry I didn't repeat the > whole thing in every instance. The price being sky high is because of the limited supply...not because the supply is spread around to all of the dealers. Look at it this way...if instead of giving each dealer 1 or 2 cars, what if they gave 1 dealership all of the cars. Do you think this would help lower the price? NO, of course not. It would in fact make the situtation even worse, because you would completely eliminate ALL dealer competition. One dealer would have the monopoly. -Stresa >> Of course... but they would run out of their allotment of a couple and it >> would have no effect on market price. I am sorry I didn't repeat the >> whole thing in every instance. > The price being sky high is because of the limited supply...not because the supply > is spread around to all of the dealers. See other post. > Look at it this way...if instead of giving each dealer 1 or 2 cars, what if they > gave 1 dealership all of the cars. Do you think this would help lower the price? > NO, of course not. It would in fact make the situtation even worse, because you > would completely eliminate ALL dealer competition. One dealer would have the > monopoly. I don't recall saying that fewer dealers with more units would lower price. In fact I know I didn't even bring up such allotment scheme. But it's still an allotment scheme, an even less competitive one. An extreme example of how allotment can effect dealer to dealer competition. The comparision of allotment is to where orders get filled without such a concern. And maybe after the initial phase the allotment scheme will fall away such that dealers order what they have customers for. >> can get". You have to remember that it isn't Ford that is setting the >> market price, it is the market itself. [quoted text clipped - 27 lines] > conditions that increase prices rather than the ideal free market setting > of the price. Excellent post! When I went to the Javitts center at the GT500's debut they said they were going to make as many as the market demanded of these cars. I was very pleased to hear this as well as them trying to price it at what the '04 Cobra cost. I figured they can easily do this without the independent rear suspensions to cut costs. Instead they limited the production which increases the demand in turn raising the prices. Ford would have been better off making 20k or more of these cars which isnt much when you think of it as four per dealership. I bet if they had increased production there would be much fewer BMW's or Corvettes sold. I just left a local Ford dealership and asked about the Shelby GT that comes out in January. They said they were also going to cost $20k over sticker, sigh... Ford needs to change this mentality people do remember and when the Camaro and Charger come out will throw it back in their face if they could. IMO that is the only reason why they are getting away with this, no competition. Personally I would buy a Corvette over a Shelby GT costing $55k more car for the money and a weight a sports car should be. Greed is what is killing this company. A great example of this is buying a bunch of the European luxury makers and forgetting what Henry Ford believed in the first place, a car for the common man. I do see the Japanese car manufacturers making the same mistakes as the American counterparts. They are cookie cutting cars the same way. Example is that a Camry, no it says Lexus ES. I also hear with the increased production numbers they are having much more reliability problems. Nick > four per dealership. I bet if they had increased production there would be > much fewer BMW's or Corvettes sold.</ |
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