My thought on the Ford GT

"Cherry_man1" (Cherry_man1)
03/05/2015 at 14:04 • Filed to: Ford GT

With the Price now known and how many they will make, is Ford doing a money grab?

I know the Ford GT is a legendary car but seriously $400K? I mean I get it's all new tech from Ford but common. The car better produce if it's gonna be that much other wise I'm throwing this new Ford GT to the trash.

DISCUSSION (31)

Dwhite - Powered by Caffeine, Daft Punk, and Corgis > Cherry_man1
03/05/2015 at 14:08

The last one appreciated in value faster than any car in recent history, at least for one in its price range. Which clearly shows that people were willing to pay more, a lot more. Ford wants to take advantage of what they missed the first time around.

Übel > Cherry_man1
03/05/2015 at 14:09

Dude what

djmt1 > Cherry_man1
03/05/2015 at 14:09

What should it be bench marked against in your opinion?

Cherry_man1 > Dwhite - Powered by Caffeine, Daft Punk, and Corgis
03/05/2015 at 14:10

I guess but I want like stupid performance from it if it's gonna be that much.

Cherry_man1 > djmt1
03/05/2015 at 14:10

At it's price range or by a perf. standpoint? Cause I have several things in mind.

Manuél Ferrari > Cherry_man1
03/05/2015 at 14:10

I don't like the price either

They should have done this:

1. Used aluminum body panels and made more to bring down the price

2. Later sold a more expensive and exclusive model with CF body panels, a slightly larger TT V8

Brian, The Life of > Cherry_man1
03/05/2015 at 14:11

My guess is that they aren't planning to lose money on each unit like they did with the last one. Also, the level of sophistication in this one is likely 4x the last. At such low volume, the revenue contribution would be a flyspeck on the balance sheets at an even million.

Cherry_man1 > Übel
03/05/2015 at 14:11

They GT is priced way above where it should be.

Cherry_man1 > Brian, The Life of
03/05/2015 at 14:11

Ya, but still it seems crazy for it to be that much.

djmt1 > Cherry_man1
03/05/2015 at 14:15

For them to be charging 400K, what car should it be able to at least match?

BoxerFanatic, troublesome iconoclast. > Cherry_man1
03/05/2015 at 14:16

If they get away with it, how is a so-called "money grab" a bad thing?

They aren't misleading, as far as we know. The price is the price, the production numbers are what they are.

How is it different than saying that a fully loaded Mustang GT is about $40K... you can choose to buy it, or not.

They aren't doing an end-around and taking tax dollars that aren't voluntary. They aren't under-cutting the purchase price, and then making it cost money to be allowed to drive it, like in-app purchasing games or other shady deals.

They aren't even, apparently, relegating the cars to leases, the way Lexus did with the ALSO ~$400K LF-A, to supposedly avoid "scalper" re-sellers.

If people can, and want to spend 400K on this car... and Ford can sell all of the cars they plan to make at that price... what exactly is the problem?

Something is only worth what someone will pay for it, and there is nothing inherently wrong with charging the maximum price that the market will bear.

If it under-performs, it may well under-sell as a result... then there will be discounts, or other market-adjustment mechanisms that take that into account. These cars often aren't utilized to their maximum, anyway, and are emotionally-involved purchases, or speculation on future value, rather than $-per-performance-stats direct calculus. People will pay the price, or they won't, but it isn't being perpetrated as any kind of fraud, as far as we can currently tell.

That gives Ford more financial room to do things in other market segments, as well... maybe there will be an alternate sports car somewhere between the Mustang/Shelby, and the new GT...

PS9 > Cherry_man1
03/05/2015 at 14:18

If you're looking at it from a Cost/results perspective, no car is worth $400k. The margins of performance between a $100k sports car and $1M one are vanishingly slim. Past about $80k or so, you're already deep in the diminishing returns portion of the graph.

Leadbull > Cherry_man1
03/05/2015 at 14:23

It's a low-volume, halo car.

They didn't build it to compete against anything or to rob people of $400k. If they wanted to make sweet fistfuls of cash, they'd sell it in high numbers, à la the 458.

They just built it because they wanted to.

Cherry_man1 > djmt1
03/05/2015 at 14:24

Aventador, F12, the 458 Special, and of course it must exceed predecessor in performance.

lone_liberal > Cherry_man1
03/05/2015 at 14:25

They are charging what they think they can get for them. That's their job. If they can't get that much for them they'll have to lower the price or stop making them. In the world of super rich car collectors "too much" means something different than it does for regular people.

Supercharged-V8-Jag > Cherry_man1
03/05/2015 at 14:35

I think Ford will sell all GTs they make. I mean look at the Porsche 918, 918 built at around 1 million each. No one thought they would ever do it but they managed to in a short amount of time.

Brian, The Life of > Cherry_man1
03/05/2015 at 14:38

Why? Just because it sports the Blue Oval?

Manuél Ferrari > Cherry_man1
03/05/2015 at 14:38

Also McLaren 675LT

They're basically the same car except the McLaren's engine is a bit bigger and has 2 more cylinders

They both have carbon fiber tubs and body panels, aluminum suspension, two turbos, and DCTs

hypnoticbutcher > Cherry_man1
03/05/2015 at 14:39

What information are you basing this off of? The performance figures we don't know?

Sam > Cherry_man1
03/05/2015 at 14:40

1. Very few of us on here could afford one, even at 190,000 (MSRP of the OG GT). So they haven't lost any sales due to price.

2. You know, as well as I know, that they're going to sell every single example no matter what. People that buy these cars aren't interested in performance, they want something that looks good and will hold its value.

scoob > Manuél Ferrari
03/05/2015 at 14:42

You forgot the manual.

/ThatGuy

Cherry_man1 > Manuél Ferrari
03/05/2015 at 14:42

oh I forgot about the McLaren o.o

Rock Bottom > Cherry_man1
03/05/2015 at 14:44

If you really get down to it, after you pass some threshold price (maybe a quarter million), does it really matter? Aren't you in the price range of people who can't possibly spend all their money before they die and are therefore just buying things they like without looking at the price tag?

I see it like this: I used to be a poor college student. I received no support from my family. Not one cent. When I took an unfortunate young lady out to eat, I was very conscious of prices. Taco Bell date. Now I'm a comfortably employed aerodynamicist and I can take a young lady almost anywhere I want. It's the difference between a $150 dollar dinner date and a $250 dollar dinner date. Either way, I got this. Now a $1,000 dinner date would worry me greatly... To me, the $150 date is the Ferrari, the $250 date is the Ford GT, and the $1,000 date is the Veyron. I can afford the Ferrari and the Ford, but I like the Ford better and it's well within reach, so I'm buying it. The Veyron is just a little too beaucoup... unless it's a date with Zooey Deschanel circa 2011, in which case SHUT UP AND TAKE MY MONEY.

Manuél Ferrari > scoob
03/05/2015 at 14:52

Hahaha I would want the manual

I don't want any of these new cars cause of paddles

But I've resigned myself to the fact that the manuals aren't gonna happen and people who want expensive cars want paddles so I just compare the cars against each other assuming all will be DCT

Manuél Ferrari > Cherry_man1
03/05/2015 at 14:55

McLaren set the template for everyone else.

The 12C was a trend setter. It was the first car I know of that didn't cost over half a million dollars and came with a carbon fiber tub, TT motor and a DCT.

Now everyone is going this route. Ford already has. The Ferrari 488 replacement will have a carbon fiber tub.

All cars are going to be the same except they'll look different.

Tohru > Cherry_man1
03/05/2015 at 15:10

Kinja'd!!!

I'm sure you had a point but I've forgotten what it was.

Galileo Humpkins (aka MC Clap Yo Handz) > Cherry_man1
03/05/2015 at 15:20

Short answer: Yes

Long answer: Yes, indeed they are. Most definitely.

Nonster > Cherry_man1
03/05/2015 at 15:48

Meh, my first thought was that it's a little bit high, but to be honest I don't really care what the price is. It's a tier of car that I can pretty confidently say will be forever out of my price range.

What I care about is the racing program. If this thing doesn't do well in LeMans or whatever circuit racing series they put it in then its a disappointment in my book.

Danimalk - Drives a Slow Car Fast > BoxerFanatic, troublesome iconoclast.
03/05/2015 at 16:33

You're not wrong about any of this, but "money-grab" is probably the most accurate. They could sell it for less, but they don't want to.

If diehard Ford fans are willing to pay it, then good for Ford.I'm sure they will sell every one of them.

Over-pricing products are done all the time in the car world. It's a cheap move just trying to eek out every dollar from your customers as possible. Ford is just keeping up with its competition. http://www.ebags.com/product/ferrar…

BoxerFanatic, troublesome iconoclast. > Danimalk - Drives a Slow Car Fast
03/05/2015 at 16:49

How do you define "over priced" that isn't subjective?

If you were selling something people like and want, and you knew you could get a nice profit margin for yourself, and 9 out of 10 people go ahead and spend the money you are asking for... but one person complains that it is a bit higher than they would prefer to pay...

Or even less relevant... what if that one dissenter has no intention, nor ability to pay anywhere NEAR the asking price, and is just offering an economically inconsequential opinion. Even if the price were lower, they STILL wouldn't be in a position of economic demand for that product. Willingness AND ABILITY to pay for a product or service is the definition of economic demand. Having an opinion about a product is NOT economic demand.

Are you obliged to lower your price for that 1 person, whether they have economic demand for the product or not?

I would argue no, you are not obligated to ask for less money for your product, at least not until you have left-over inventory, and no remaining demand at the initial price point, and a discount might help you clear remaining inventory, or justify further production.

Now, if the circumstances are different, and if you can only sell ONE of the initial units in your inventory, and the other units just sit there in inventory, then you start to consider lowering your profit margin, and the price, and see if people will start to buy the rest of your products. Like, say the new Dodge SRT Viper, that wasn't selling well, and they dropped the price to try to sell more of them.

These cars have just been announced. There is no sign yet that the cars won't sell. If they do, Ford isn't over-charging. If they don't, Ford will likely drop the price to sell the cars.

This is free market economics, as in they are free to ask what they want, and you are free to not buy it, if you don't care to. If they have trouble selling their stock, they may choose to negotiate with you, if it will make a sale that they need.

Danimalk - Drives a Slow Car Fast > BoxerFanatic, troublesome iconoclast.
03/05/2015 at 17:37

Again, you are not wrong with any of the many words in your reply.

"Over priced" is definitely a subjective point of view. My point is simply that Ford sees an opportunity to make a product more profitable and they are taking that opportunity in a very big way. Bigger than they have in the past, and much closer to how their competition makes its products more profitable.

We've grown to expect this strategy from certain brands, but it's a new strategy for Ford's top level. It's a path Ford hasn't taken very much in the past, so it's a shame they are making such an easy grab for it now.