So Toyota has 100s if not 1000s of Toyota RAV4s sitting in multiple dealers 100 miles around your home. While Ford…makes you wait 2,3 or 4 months for your model…that’s a bad business model for Ford Motor Corp.

 

It may not take that long. If they move more of the factory to on demand ordering you may be able to get a custom car in a matter of weeks.

 

.......particularly if demand is down and there isn't a backlog of orders.

 

It's not as if they wait for the customer to order and then build. Typically, they build many different spec vehicles and when a order comes, they match it to a customer and send the vehicle out. If a vehicle is a rare build, it may take a long time but a standard spec build may already be built and ready to ship.

 

It still wouldn’t work for the vast majority of buyers. Also, if the competition is not doing this, then all the buyers who need a car now, will just go to those who have lots of cars to buy. The overwhelming vast majority of buyers do not want to wait

 

What Ford is saying is that they are seeing a shift in consumer behavior when it comes to this, so what historically buyers have done isnt really the point.

Let me use myself as an example. I chose between a BMW 750 and my Mercedes S560. One of the big reasons was that I could buy the S560 off the lot and I had to wait 2-3 months for the 750. I did get a car that lacked some things I wanted, if you had told me I could have had exactly what I wanted in 2-3 weeks, I would have waited.

I don't want to wait months, but I can wait weeks.

 

I agree that it does work for some… And yeah Ford is noticing what they are noticing. No doubt. But the vast majority of people want their car now, now, now.

These companies used to this. Ford, GM and Cyrsler used to offer everything custom including multiple final drive ratios…you were very easily able to order something but they were booming so well. . But then when Toyota and Honda showed up and starting eating into market share, everything changed.

 

What is the value added from that big, beautiful dealership?
What is the added cost from that big, beautiful dealership?

Perhaps Ford is building that big beautiful dealership, and all the workers' salaries (salesman, manager, next manager, GM, car warsh guy, janitors) cuz they think I'm cute?

The on-line model has proven to work and that buyers prefer it.
JD Power Survey

 

Ford doesnt build the dealer, its an independent business.

 

This has to be one of the most BS articles written this week. It is the case of some writer needing to produce words and getting a quote from some Ford exec to fit the theme. Sure they would love to custom order everything and have a continuous line of orders for every model. Factually, you can now and have been able to for decades, order anything you want.
Manufacturers load their dealers up with cars to keep assembly lines running and to have continuity. Labor contracts are written so people are guaranteed pay and they don't just send people home when the sales slow or while they wait for "special orders" to miraculously materialize. Incentives are pre-planned into the pricing and they are the way they convince dealers to take more merchandise than they wish to and to keep some movement.

I was a new car dealer for decades and I can assure you...the whole idea is a pipe dream. And, before people with no knowledge start bragging about Tesla, check what percentage of world wide sales they account for and get back with me about their importance!

 

They also lose a lot of vehicles that way, sitting out in both the factory-lots and dealer-lots in floods, severe storms, and other harmful or destructive sources. Even if a vehicle is not totalled, the average customer is not going to want to take delivery of a new vehicle that, even when washed/waxed, has splotches and etches all over the clearcoat paint from accumulated bird-droppings, acid rain, industrial fallout, kids throwing eggs, etc......

 

Who do you think is paying for that dealership?

 

The dealership owner who owns it. Seriously, I used to consult with car dealers and know multiple dealer owners. A car dealership is a franchise of the vehicle manufacturer, and they pay for their own construction and improvements etc. The manufacturer provides financing and things of that nature, but its an independent business.

 

Its unbelievable that you even have to explain that. The blue prints, design and look are all from the manufacture…private cash pays for the whole thing

 

The cars sitting on dealers lots are not the worry of the manufacturer. New Fords are invoiced and dealers drafted on by the manufacturer before they are shipped. Were there a loss on the dealer's vehicles the dealer's insurance pays.

This does though bring up another fact about how it works. Manufacturers build cars and ship them to dealers as a paid item straight off the assembly line. In the modern day they are not building them unsold. How many manufacturers would like to have that cash flow situation. That also does not take into account the billions of dollars in parts they ship to their dealers yearly where they are inventoried at the dealers expense and sold to their own shop and many thousands of independent shops.

Automotive manufacturers make money by running their equipment and building cars...not out soliciting special orders from some guy walking down the street. That is why they have thousands of dealers.