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Ford CEO says EVs will be sold 100% online with nonnegotiable price

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Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#281
post #195

Earlier quoted context omitted.

This doesn't make any sense. You would only feel ripped off because some dealerships say "No Haggle" and some do haggle. If every dealership has the same price for a specific car then literally by definition you cannot get ripped off. You're also fixating too much on the meaning of MSRP. Before the car shortage MSRP was basically just a marketing number to anchor negotiations at a high number (except for cars in supe…

To make it as clear as possible - Dealerships compete to win your business. They compete in varying ways, which include price and service. Who does Ford compete with if they set all of the prices and offer direct sales for an entire product line (EV's in this case)? The answer is "nobody". And we all know competition is what benefits the consumer... this is a regression, not an advancement. The dealership model can u…

> Who does Ford compete with if they set all of the prices and offer direct sales for an entire product line (EV's in this case)?

Literally every other car manufacturer. Wtf…?

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#282
post #39

A lot has been said about the dealership model in the last few years, and the almost universal consensus is that it is an unnecessary and predatory industry and all auto makers should just sell cars directly like Tesla does. That being said, is there any counterpoint to this view? Are there any benefits that dealerships offer today over direct sales? What would we lose if we got rid of every dealership? If there is t…

Easier to see multiple cars from multiple different manufacturers in person in one lot through an informed salesperson. Ford showrooms will not have Toyota cars.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#283

Earlier quoted context omitted.

Diplomacy is the art of saying “good dog” until you make it to the rock. Ford is learning what Tesla knew from the start: dealership interests aren’t aligned with EV manufacturers. There’s very little service revenue, and dealers are incentivized to add “market adjustments” to vehicles (which Ford dealers have been doing) creating a poor customer experience. Ford has existing dealerships and is going to have a heck o…

> dealership interests aren’t aligned with EV manufacturers. There’s very little service revenue Citation needed. Both my EVs and ICEs needed similar amount of service. Breakage of drive trains are super rare nowadays (expect for over engineered performance stuff and just broken designs), same as breakages of batteries (cough, Bolt, cough). All stuff my cars needed a service for in last 20 years were comfort features…

Your ICE doesn't need oil changes, transmission fluid, a timing belt, spark plugs, or any of that?

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#284
post #39

A lot has been said about the dealership model in the last few years, and the almost universal consensus is that it is an unnecessary and predatory industry and all auto makers should just sell cars directly like Tesla does. That being said, is there any counterpoint to this view? Are there any benefits that dealerships offer today over direct sales? What would we lose if we got rid of every dealership? If there is t…

The dealership model has never benefited the consumer financially. The majority of dealers view auto sales as one time transactions where their goal is squeeze money from the customer using morally dubious tactics if not outright lies. You have to place the dealership model in historical context. They were created in an era where the Detroit automakers monopolized the industry. And they created mostly shoddy cars. They created “choice” by rebadging one car and passing it off as another. There are good dealerships who want a relationship with the customer. But in my experience they usually end up selling to a larger dealership who only care about gouging the customer.

Plus with cars basically becoming high tech batteries on wheels with dozens of minicomputers. When an EV really breaks down, I doubt your local mechanic can do much about it. At the most, he can swap out one module with another (if he has it). More likely the only thing the dealer can do, is give you a loaner car while the manufacturer ships the modules and components you need. Ford and Tesla are probably better off giving you a loaner car directly and when the parts are available instruct you to go to the nearest repair facility or in the worst case, the technician will come to you.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#285
post #127
post #39

A lot has been said about the dealership model in the last few years, and the almost universal consensus is that it is an unnecessary and predatory industry and all auto makers should just sell cars directly like Tesla does. That being said, is there any counterpoint to this view? Are there any benefits that dealerships offer today over direct sales? What would we lose if we got rid of every dealership? If there is t…

When I see "No Haggle, Fixed-Price, Online Only", I think "Rip Off", and I can't be the only one. It's not that I enjoy haggling with car salesmen, walking out the door and getting hunted down in the parking lot like an animal... I don't... in fact I hate it. But at the end of the day I get a deal I'm satisfied and comfortable with - and it's always below MSRP - far below. I think what we're seeing here is a combinat…

> younger generation's fear of conflict

this seems unfounded, with no way to ascertain it. and likely driven by some unconscious biases

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#286
post #195

Earlier quoted context omitted.

This doesn't make any sense. You would only feel ripped off because some dealerships say "No Haggle" and some do haggle. If every dealership has the same price for a specific car then literally by definition you cannot get ripped off. You're also fixating too much on the meaning of MSRP. Before the car shortage MSRP was basically just a marketing number to anchor negotiations at a high number (except for cars in supe…

To make it as clear as possible - Dealerships compete to win your business. They compete in varying ways, which include price and service. Who does Ford compete with if they set all of the prices and offer direct sales for an entire product line (EV's in this case)? The answer is "nobody". And we all know competition is what benefits the consumer... this is a regression, not an advancement. The dealership model can u…

If Ford sells a car at $20000 to a dealership, no way they sell it to you below $20000 given they even have additional costs due to the inefficiencies of being a middleman, rent, transportation, manual staff, insurance, etc

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#289
post #157

Earlier quoted context omitted.

Selling online without negotiated price is a big change. That should make the dealerships really uncomfortable in the long run… he's kind of saying "oh the dealerships could rent out Mustangs" but is that actually realistic?

Diplomacy is the art of saying “good dog” until you make it to the rock. Ford is learning what Tesla knew from the start: dealership interests aren’t aligned with EV manufacturers. There’s very little service revenue, and dealers are incentivized to add “market adjustments” to vehicles (which Ford dealers have been doing) creating a poor customer experience. Ford has existing dealerships and is going to have a heck o…

> "Diplomacy is the art of saying “good dog” until you make it to the rock."

this was new to me and the 'to the rock' part didn't make sense to me, so i looked it up.

http://marvin.cs.uidaho.edu/About/quotes.html this page says it's actually this: "Diplomacy is the art of saying 'nice doggy' until you can find a rock."

find a rock as in kill them? :O

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#290
post #157
post #82

This article takes an off-the-cuff comment from the CEO of Ford and reads too much into it IMO. He wasn’t saying dealerships are going away; he was actually saying the opposite. The point he was making was that Ford is going to adopt some of Tesla’s practices while using the dealership network to compete with them. Here’s the quote with more context: “I believe for retail, we have to -- it's kind of like what happene…

Selling online without negotiated price is a big change. That should make the dealerships really uncomfortable in the long run… he's kind of saying "oh the dealerships could rent out Mustangs" but is that actually realistic?

Commissions are 30-40% of an auto dealer's costs as a % of gross profit. If salespeople don't have to negotiate price, you can cut a lot of that cost and focus on higher margin (e.g., financing) and subscription products (e.g., parts & services) that deepen customer loyalty. The big groups will be better at making these investments (and the investments needed to sell/maintain EVs) and will continue to consolidate what remains a highly fragmented industry (i.e., the two largest dealer groups, AN and LAD were each only 1.75% of new car sales in 2021).

I wouldn't cry for nor count the dealers out just yet.

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