re: Ford CEO: We’ll Move to Fixed Prices

I think the Ford family is gonna axe this guy sooner or later.
Dealerships are huge profit centers for manufacturers. They carry the load of the inventory. Once ford sells a truck to a dealer it’s considered a sold unit. Ford is looking at a lot of lawsuits from dealers. When you open a franchise car store you build what the manufacturers tell you to based on sales forecast and expected market share. Dealers are forced to buy dogs along with the hot cars. “You want those Raptors, well you gotta take these beige Fusions as well” Can’t pay for them that’s ok we’ll floor plan them to you” People on the OT think of ourselves as astute car buyers but most car purchases are pretty much impulse buys. Lots of new cars are sold through the service dept. as well. “Oh your car needs a new $6k trans that you can’t afford, come on over to the new side and we can get you rolling today. Negative equity don’t worry we can roll that in at 15 percent interest” The manufacturers don’t want the backlash and can be insulted from that. Yes the markups sucked for sure but I think a lot of this was caused by tight supply and cheap/easy credit. It’s starting to normalize now. Like I said the manufacturers tell you what to build by what you’re expected to sell. Many dealers are mortgaged to the limit and they couldn’t get the cars to sell hence a good bit of the markup.

I don’t see this resulting in lower prices for the consumer. I like the game and pitting dealers against each other.