Ford upending the US car market
Discussion
liner33 said:
DonkeyApple said:
I think those articles are hyperbolic, if no seeded to add weight to the long standing desire of manufacturers to get rid of the dealers and keep that margin for themselves, not pass it on to the consumer.
.
Rather than read the articles the interview is on YouTube so you can hear it from the horse's mouth . It's not an ev issue per se but as car sales are likely to drop significantly following the introduction of EVs it's a problem that they need to address now so the systems are in place for the future.
I do think that Ford's particular issue is also that they divested themselves of all the premium brands so have the particular issue of having to wait longer than other manufacturers to get lines up and running and in Europe their EV rollout is based on the VW MEB platform isn't it?
The run in to 2035 could be really inconsistent for mainstream manufacturers that's for sure.
Heres Johnny said:
The flip side of the argument about the Tesla model is:
Dealerships are often franchises. They buy the cars at an internal price, often involving discounts the more they sell. They can decide to undercut the dealership down the road to sell more cars if they wish.
At times when demand is greater than supply, then higher prices can occur, but when the reverse is true, the prices will fall.
Their customer service performance will also mean the better they are, the more likely customers will be to go to them. You may find a dealership offers better customer service but the quid pro quo is there cars may be slightly higher. Some custoemrs will be happy with this.
Dealers that are the most expensive and have the worst customer service will eventually fail, and so it should be.
A market where the manufacturer sets all the prices, just means they are setting the margin, removing flexibility, and they also reduce the capability of the dealerships to be creative. Anyone thats owned a Tesla and been at the mercy of their customer services, either the experience of collecting a 60k from souless carpark where the handover is worse than buying a drive through burger, or have a fault with a car and can't actually talk to a human at a service centre will know that "one consistent way of working" doesn't necessarily mean it's a good one.
Neither is perfect, but we need to be careful what we wish for. The cosumer rights organisations have fought for years to remove the concept of an RRP, and to a large extent they have done. Yes you can look at companies like apple and the prices are usually the same everywhere, but they simply won't supply people who undercut. That said, companies do offer more value, John Lewis for instance will offer more warranty than the others - so competition can come in many forms.
For many of us, it's not practical to use a different dealer if the local one's customer service is poor - in my case it would be a 60 mile round trip to a different one for the same manufacturer. Dealerships are often franchises. They buy the cars at an internal price, often involving discounts the more they sell. They can decide to undercut the dealership down the road to sell more cars if they wish.
At times when demand is greater than supply, then higher prices can occur, but when the reverse is true, the prices will fall.
Their customer service performance will also mean the better they are, the more likely customers will be to go to them. You may find a dealership offers better customer service but the quid pro quo is there cars may be slightly higher. Some custoemrs will be happy with this.
Dealers that are the most expensive and have the worst customer service will eventually fail, and so it should be.
A market where the manufacturer sets all the prices, just means they are setting the margin, removing flexibility, and they also reduce the capability of the dealerships to be creative. Anyone thats owned a Tesla and been at the mercy of their customer services, either the experience of collecting a 60k from souless carpark where the handover is worse than buying a drive through burger, or have a fault with a car and can't actually talk to a human at a service centre will know that "one consistent way of working" doesn't necessarily mean it's a good one.
Neither is perfect, but we need to be careful what we wish for. The cosumer rights organisations have fought for years to remove the concept of an RRP, and to a large extent they have done. Yes you can look at companies like apple and the prices are usually the same everywhere, but they simply won't supply people who undercut. That said, companies do offer more value, John Lewis for instance will offer more warranty than the others - so competition can come in many forms.
Not something which is possible for routine servicing, etc.
rscott said:
For many of us, it's not practical to use a different dealer if the local one's customer service is poor - in my case it would be a 60 mile round trip to a different one for the same manufacturer.
Not something which is possible for routine servicing, etc.
Its something I have done for many years, its once a year Not something which is possible for routine servicing, etc.
rscott said:
Heres Johnny said:
The flip side of the argument about the Tesla model is:
Dealerships are often franchises. They buy the cars at an internal price, often involving discounts the more they sell. They can decide to undercut the dealership down the road to sell more cars if they wish.
At times when demand is greater than supply, then higher prices can occur, but when the reverse is true, the prices will fall.
Their customer service performance will also mean the better they are, the more likely customers will be to go to them. You may find a dealership offers better customer service but the quid pro quo is there cars may be slightly higher. Some custoemrs will be happy with this.
Dealers that are the most expensive and have the worst customer service will eventually fail, and so it should be.
A market where the manufacturer sets all the prices, just means they are setting the margin, removing flexibility, and they also reduce the capability of the dealerships to be creative. Anyone thats owned a Tesla and been at the mercy of their customer services, either the experience of collecting a 60k from souless carpark where the handover is worse than buying a drive through burger, or have a fault with a car and can't actually talk to a human at a service centre will know that "one consistent way of working" doesn't necessarily mean it's a good one.
Neither is perfect, but we need to be careful what we wish for. The cosumer rights organisations have fought for years to remove the concept of an RRP, and to a large extent they have done. Yes you can look at companies like apple and the prices are usually the same everywhere, but they simply won't supply people who undercut. That said, companies do offer more value, John Lewis for instance will offer more warranty than the others - so competition can come in many forms.
For many of us, it's not practical to use a different dealer if the local one's customer service is poor - in my case it would be a 60 mile round trip to a different one for the same manufacturer. Dealerships are often franchises. They buy the cars at an internal price, often involving discounts the more they sell. They can decide to undercut the dealership down the road to sell more cars if they wish.
At times when demand is greater than supply, then higher prices can occur, but when the reverse is true, the prices will fall.
Their customer service performance will also mean the better they are, the more likely customers will be to go to them. You may find a dealership offers better customer service but the quid pro quo is there cars may be slightly higher. Some custoemrs will be happy with this.
Dealers that are the most expensive and have the worst customer service will eventually fail, and so it should be.
A market where the manufacturer sets all the prices, just means they are setting the margin, removing flexibility, and they also reduce the capability of the dealerships to be creative. Anyone thats owned a Tesla and been at the mercy of their customer services, either the experience of collecting a 60k from souless carpark where the handover is worse than buying a drive through burger, or have a fault with a car and can't actually talk to a human at a service centre will know that "one consistent way of working" doesn't necessarily mean it's a good one.
Neither is perfect, but we need to be careful what we wish for. The cosumer rights organisations have fought for years to remove the concept of an RRP, and to a large extent they have done. Yes you can look at companies like apple and the prices are usually the same everywhere, but they simply won't supply people who undercut. That said, companies do offer more value, John Lewis for instance will offer more warranty than the others - so competition can come in many forms.
Not something which is possible for routine servicing, etc.
liner33 said:
rscott said:
For many of us, it's not practical to use a different dealer if the local one's customer service is poor - in my case it would be a 60 mile round trip to a different one for the same manufacturer.
Not something which is possible for routine servicing, etc.
Its something I have done for many years, its once a year Not something which is possible for routine servicing, etc.
Sheepshanks said:
liner33 said:
rscott said:
For many of us, it's not practical to use a different dealer if the local one's customer service is poor - in my case it would be a 60 mile round trip to a different one for the same manufacturer.
Not something which is possible for routine servicing, etc.
Its something I have done for many years, its once a year Not something which is possible for routine servicing, etc.
DonkeyApple said:
Not seeing the 'worried' bit to be honest. Why would any business want an entity sitting between its product and its customers and taking a slice of the action?
The old school business model - franchise.It benefitted the OEM as they could off load stock onto the dealership. Thus creating 'wholesales' and reducing their liabilities. However incentivising dealers via the franchise business model means reduced profit margins -i.e to offload 20 Fiesta Pop Pluses onto a dealer group, they'd have to be discounted significantly.
It's one of the reasons pay and conditions in dealers are relatively poor. There's no money in it, unless you have scale, and even then.
And it's not just car sales that'll go online, parts and accessories as well. The dealer's model will change quite significantly and may be for the better.
Sheepshanks said:
It's not so much the distance, as time - must be many people who are an hour away from dealers at typical "taking the car to be serviced" time. If you can't tie it in with where you work etc and the car has to go back a two or three times a year for various issues then losing 4hrs out of the day each time starts to wear thin.
Having a car that needs 2 or 3 dealer visits for issues is a separate matter but hardly anyone is so important they can’t spare a couple of hours at a dealership once a year , plenty have waiting rooms and Wi-Fi so it’s possible to get work done liner33 said:
Having a car that needs 2 or 3 dealer visits for issues is a separate matter but hardly anyone is so important they can’t spare a couple of hours at a dealership once a year , plenty have waiting rooms and Wi-Fi so it’s possible to get work done
To be honest that's a typical PH comment - no realisation that because it's easy for you there are many others who can't just duck out for a couple of hours. it's not about being important - it's quite hard to see patients, teach kids, assemble things in a factory etc from a dealer waiting room.
The number of complaints about car dealerships price gouging has increased dramatically, and the manufacturers are fed up with it. Bad publicity often means lower sales numbers, lower profits and customers looking elsewhere to buy.
Worth a watch to show that dealerships only concern is profit
https://www.youtube.com/watch?v=l6JNWpvJqjk
https://www.youtube.com/watch?v=MOlOIwK_WSc
https://www.youtube.com/watch?v=tCyq9QFjKnc&t
Worth a watch to show that dealerships only concern is profit
https://www.youtube.com/watch?v=l6JNWpvJqjk
https://www.youtube.com/watch?v=MOlOIwK_WSc
https://www.youtube.com/watch?v=tCyq9QFjKnc&t
Sheepshanks said:
liner33 said:
Having a car that needs 2 or 3 dealer visits for issues is a separate matter but hardly anyone is so important they can’t spare a couple of hours at a dealership once a year , plenty have waiting rooms and Wi-Fi so it’s possible to get work done
To be honest that's a typical PH comment - no realisation that because it's easy for you there are many others who can't just duck out for a couple of hours. it's not about being important - it's quite hard to see patients, teach kids, assemble things in a factory etc from a dealer waiting room.DodgyGeezer said:
liner33 said:
Probably a typical PH comment because I would imagine that by far the majority of car owners live 20 miles or more from their local dealership or specialist repairer
I'd be surprised - certainly in the SouthEastNMNeil said:
Interesting article.
https://insideevs.com/news/610114/ford-modele-deal...
Someone ran the numbers and found that 98% of the population in the US lived within 20 miles of a Ford dealership,
https://insideevs.com/news/610114/ford-modele-deal...
Someone ran the numbers and found that 98% of the population in the US lived within 20 miles of a Ford dealership,
Sheepshanks said:
DodgyGeezer said:
liner33 said:
Probably a typical PH comment because I would imagine that by far the majority of car owners live 20 miles or more from their local dealership or specialist repairer
I'd be surprised - certainly in the SouthEastNMNeil said:
Interesting article.
https://insideevs.com/news/610114/ford-modele-deal...
Someone ran the numbers and found that 98% of the population in the US lived within 20 miles of a Ford dealership,
https://insideevs.com/news/610114/ford-modele-deal...
Someone ran the numbers and found that 98% of the population in the US lived within 20 miles of a Ford dealership,
https://electrek.co/2022/09/14/ford-sets-new-deale...
Dynion Araf Uchaf said:
The old school business model - franchise.
It benefitted the OEM as they could off load stock onto the dealership. Thus creating 'wholesales' and reducing their liabilities. However incentivising dealers via the franchise business model means reduced profit margins -i.e to offload 20 Fiesta Pop Pluses onto a dealer group, they'd have to be discounted significantly.
It's one of the reasons pay and conditions in dealers are relatively poor. There's no money in it, unless you have scale, and even then.
And it's not just car sales that'll go online, parts and accessories as well. The dealer's model will change quite significantly and may be for the better.
I would assume that servicing revenues will also go into decline as the number of EVs grow. And from a U.K. perspective the loss of financing income is only ever an FCA pen stroke away. It benefitted the OEM as they could off load stock onto the dealership. Thus creating 'wholesales' and reducing their liabilities. However incentivising dealers via the franchise business model means reduced profit margins -i.e to offload 20 Fiesta Pop Pluses onto a dealer group, they'd have to be discounted significantly.
It's one of the reasons pay and conditions in dealers are relatively poor. There's no money in it, unless you have scale, and even then.
And it's not just car sales that'll go online, parts and accessories as well. The dealer's model will change quite significantly and may be for the better.
My guess would be that physical new car selling will go the same way as physical banking and probably decline at a similar rate to Boomer car buying.
I think dealerships will evolve to become more like the Tesla shops, and eventually it will all go to online sales. The same as travel shops - they're barely needed anymore.
Perhaps storage facilities for used car sales and to enable test drives, there has to be some physical storage for what is a physical commodity... But the 'sales' aspect will likely change.
And for new car sales, a bigger push towards leasing with fully packaged insurance and servicing. Like your mobile phone, one price is set and it covers everything.
Perhaps storage facilities for used car sales and to enable test drives, there has to be some physical storage for what is a physical commodity... But the 'sales' aspect will likely change.
And for new car sales, a bigger push towards leasing with fully packaged insurance and servicing. Like your mobile phone, one price is set and it covers everything.
OutInTheShed said:
Possibly 'dealerships' will expand their business model from hiring you a car for a fixed three or four year period, to hiring out cars over whatever short or long period you care to pay for?
And possibly be multi brand if they remain independent businesses. I suspect that the manufacturers will prefer to crush the franchises under their debt yoke and turn the sites into fulfilment centres, membership charging hubs and brand experiences and the only job that's safe is the coffee doris with the big rack who'll sell subscription upgrades while waving that rack in the faces of sad old men who'll sign anything just for a moments attention from someone who finds them repellent. TheDeuce said:
I think dealerships will evolve to become more like the Tesla shops, and eventually it will all go to online sales. The same as travel shops - they're barely needed anymore.
Perhaps storage facilities for used car sales and to enable test drives, there has to be some physical storage for what is a physical commodity... But the 'sales' aspect will likely change.
And for new car sales, a bigger push towards leasing with fully packaged insurance and servicing. Like your mobile phone, one price is set and it covers everything.
It's interesting how the age of owning nothing appears to be looming. Perhaps storage facilities for used car sales and to enable test drives, there has to be some physical storage for what is a physical commodity... But the 'sales' aspect will likely change.
And for new car sales, a bigger push towards leasing with fully packaged insurance and servicing. Like your mobile phone, one price is set and it covers everything.
A colleague of mine is working on a project where City employers offer a package that includes rented accommodation, car lease, media subscriptions, club and flight memberships and 'dial a mummy' help service!!! Sounds insane to me but they're convinced, as seem to be some employers, that modern grads struggle to sort all this stuff and will leap at having it all done for them and bent over for the privilege.
DonkeyApple said:
It's interesting how the age of owning nothing appears to be looming.
A colleague of mine is working on a project where City employers offer a package that includes rented accommodation, car lease, media subscriptions, club and flight memberships and 'dial a mummy' help service!!! Sounds insane to me but they're convinced, as seem to be some employers, that modern grads struggle to sort all this stuff and will leap at having it all done for them and bent over for the privilege.
A colleague of mine is working on a project where City employers offer a package that includes rented accommodation, car lease, media subscriptions, club and flight memberships and 'dial a mummy' help service!!! Sounds insane to me but they're convinced, as seem to be some employers, that modern grads struggle to sort all this stuff and will leap at having it all done for them and bent over for the privilege.
that sounds positively dystopian Gassing Station | EV and Alternative Fuels | Top of Page | What's New | My Stuff