Why are the GT's dropping in prices when V8 Ferrari hold on?

[FFCobra]

Thanks for posting this info: http://www.fordgtforum.com/forums/showthread.php?p=27342#post27342

After reading the total numbers of GT's produced, I have to ask the obvious question. Why are dealers and individuals selling the Ford GT's for sticker and less?

The total available Ford GT's is far less than each of the production runs of the Ferrari 355, 360 and the 430's (expected run). So why do the Ferrari V8's hold their value above MSRP for 4 to 5 years?

The Ferrari mystique is just that. A mystique. I own a 355 and I can tell you that it's not built that well. It's very crudely built and not something that will last for years and years without a lot of money being spent. But I love the Ferrari 355 because it is so dang beautiful and the engine makes a sound that makes you smile when you pass under bridges. Personally, I would keep my 355 for many years if I had the space, but I would not consider the 360 and 430 that kind of emotional car.

The 360 and 430 Coupe's have poor styling and are/were mass produced (compared to the Ford GT). They are too big and have too many lines that don't match. Even real Ferrarist agree that the 355 is the last of the beautiful Ferrari's. Most Ferrarist will say that the 355 has better styling, engine sound, and driving "feel". But the 360/430 have better interiors and generally perform better.

The Ferrari 360 was made for 5 years and a total of 17,500; 10,000 were coupes. The cars had a 2 year warranty vs the GT's 3 year. 360's require timing belt service every 3 years and a 30K service that will run about $5,000. The GT should be as reliable as any other Ford. So I would expect GT owners to have less time in the shop than a 360 owner and the bills will be far less.

Here's a look at the 360 values: (193 for-sale on Cars.com)

2000 Original MSRP = $136,425
Current Value Avg = $125,000

2001 Original MSRP = $143,270 and $153,200 (F1)
Current Value Avg = $130,000

2002 Original MSRP = $140,615 and $150,594 (F1)
Current Value Avg = $140,000

2003 Original MSRP = $143,860 and $154,090 (F1)
Current Value Avg = $159,000

2004 Original MSRP = $151,245 and $161,940 (F1)
Current Value Avg = $170,000

Notice that the asking prices for the 2003 and 2004 models are still over the original MSRP.

The 430 is better than the 360 because it no longer uses belts for timing. But it will still have services and the cost will be higher than a GT.

Now let's look at the 430 Values: (40 for-sale on Cars.com)

2005 Original MSRP = $174,585
Current Value Avg = $220,000

2006 MSRP = $168,005
Current Value Avg = $235,000

Notice that the 430's are selling for about $50,000 over the original sticker. If Ferrari follows its plan, they will try to produce 30% more 430's over 5 years than they made of the 360.

The Ferrari V8 sales don't really follow normal logic. I have been trying to sell my 355 for about 2 months (got it sold last week) and one dealer told me this: He told me that the Ferrari 430 and 360 are better cars than the GT. He told me I will hate my GT if I drove a 430. I didn't tell him that I know the 430 very well and didn't argue with him because he was talking about buying my 355.

He went on to tell me that "the market" has spoken. The Ferrari 430 and 360 are far better than the Lamborghini Gallardo and the Ford GT. That's why they still sell for over MSRP. How could I argue with the logic? I can't figure out the V8 Ferrari market, maybe you can explain it to me.

I would like to hear your comments on why the Ford GT is dropping in price, yet the 360's and 430's are selling for over MSRP.

We should ban together and keep the prices up.

- Bill

 

[SuperB]

Ferrari is a status symbol to many of the snobs, they want a Ferrari so they can say they have a Ferrari, thus, the high price.

Same thing with any luxury item, one brand is regarded as the best of the best and the one that everyone wants, especially the snobs.

I'd like to have a Ferrari, and a Lambo, but I won't pay more than MSRP for a Ferrari, but I am not a snob :wink As for Lambo, it's on my list :thumbsup

 

[prmoldoaks]

The GT is a car that will appreciate with age, it is a FORD, but there are 3500+ and some of these are already biting the dust.

Sure there will always be deals, but the GT is a future classic and in 20 years from now it will still be as good as it is today, will these Farraris, I dont think so.

The GT in 20 years time will be more exclusive and at the moment its just another Super car by FORD, but it is pretty exclusive in numbers. I would call it a modern day Cobra,

 

[LEMANSZ]

owned and sold a F430..great car...The GT more magical and blows the doors off of it...long term ownership of the 430...20k or a tune-up at 15k miles...I didn't buy the GT for re-sale/investment value. I have other people doing that for me...enuff said

 

[dbk]

Part of it is fear. People can't predict GT prices. They go at invoice, they go over sticker still. One was purchased a mile from where I lived two weeks ago over sticker.

Dealers hear about this stuff and don't want to be the last guy left so they panic.

 

[ROCMAN]

This is a niche market. In the public's eye, the Ferrari is considered the best. Most people that can afford these cars are not true enthusiasts. They buy Ferrari because of the name. They never drive it, and when they do, they never drive it the way it should be driven. That does not go for all F car owners, but a majority of them. I personally love F cars and will buy one when the time is right.
When you take the typical Ferrari owner, and bring up the Ford GT, most of them would laugh and say the car is not in their league. This snobbish behavior makes the market the way it is. When people say it enough, others will start to believe it.
Also, I think there are many buyers that want the car, but are concerned with what other people may think. They end up buying "the safe bet" and know that most people will say "wow, you have a Ferrari". Ferrari always seems to be a crowd pleaser in conversations, but the Ford GT is a crowd pleaser in person.

 

[jimfro]

GT Prices

I think all of the above are accurate in there analysis of the market. Ford is missing a real chance to build an American market by not continuing to make this car or a follow on vehicle. The excitement this car created got lots of people in the showroom, how many bought a cheaper ford is only conjecture. In my opnion ford could still start a line of high end cars that rival Benz and Lexus. Lexus is a Toyota but sold in a totally different way from any Toyota store. GT's and High quality sedans marketd in a new way could bring Ford out of the situation they are currently in.

 

[dbk]

I think so too. You'll talk to dealers who live in la la land who say "I turned down 195k" (as I recently was told by a salesman) who have know idea what the hell is going on. Likewise, you have Jimbob in Missouri who can barely afford to pay for the floor space who hears a car was sold 5k below sticker and will subsequently take the first offer they get. People who sell and trade Ferrari's for a living know their market. People who haggle over whether or not the Focus includes power windows do not.

For now, prices are going to drop. I think they'll floor in the next 12-18 months, and then who knows. I think it's entirely possible they'll experience appreciation from where they are selling now, and I think they'll hold value similar to what a 360 holds. They'll hold at least as well as Gen II Vipers, the previous benchmark of American performance and exclusivity, and those hold very very well.

You hit the nail on the head.

It will be interesting to see what happens in the next few months, I think it's possible prices will go up!

 

[prmoldoaks]

Who Cares??????????

If you purchased the GT to worry about the price direction, you probably purchased it for the wrong reasons.

I love my GT, its a thing of Beauty and people in the UK just cant stop looking at it and commenting look at those tires!!!!!

If it went down $100,000 dollars great I'd buy another one and thrash the hell out of it, If it goes up $100,000 it wont make me sell or stop driving it.

I bought the GT and have written off the cash from day one, but fallen in love for the second time in my life :willy

 

[ATM empty]

I bought my Ford GT because I liked the car, not as a positive cash flow in future. I hope Ford never makes another GT after the 2006 run. We are part of a very small group of car owners, we purchased a part of history. Call me a "LIFETIME" owner

 

[eshrink]

Actually...

It is only financially sound to worry about a depreciating object and its long term hold value. A car is a decidedly poor investment, but there is that tendency to look at it as though it were the same as buying equities...and most sane individuals worry about the equities market.

Secondly, it is not so much fear that mobilizes the dealers to sell low but the cost of floor-planning the vehicles. With a GT costing $600-800 per month to floor plan, it is not wise to hold onto the car indefinitely and have it eat away your profit by paying increased overhead costs per month.

Thirdly, many uninformed (yes, they do exist) dealers continued to believe that this is a very lucrative market, but when their $299k price target on Autotrader was not realized, they began looking for a bail out. In equities trading this can be referred to as "catching a falling knife."

Finally, the idea of banding together in an attempt at price fixing reminds me of a young decorticate on eBay who has bid ceaselessly on GTs (and other vehicles) and merely did a disservice to us all. May a pox fall upon him and his two fathers.

Bottomline: Enjoy your car, hope someone wants it badly at some future point, assume for now that it is money well-spent...but definitely gone for now.

Enjoy yourselves...money is such a horrible image over which to have masturbatory fantasies.

- doc

 

[DanQ]

I'm wondering if the resale GT market won't be bouyed by sales to europe, japan? Can the GT be exported there? Seems like the US got most of the cars and Europe got almost nothing. Will collectors overseas snap up GTs while they are cheap in the USA?

 

[timcantwell]

An economist's view

I believe the answer to the question, is simple. Supply and demand. As far as I know, my Ferrari dealer tells me that all NEW Ferrari automobiles are spoken for before they reach the dealer's showroom, with waiting lists behind each order. Speculators and "posers" who put their 1000 miles on new cars and then "re-market" the cars usually can get a 20% to 30% premium above the MSRP. Dealers cannot sell new cars for a penny over sticker. The high "used" value of current models combined with a very small dealer network with no inventory allocation results in inflated prices due to supply and demand. Ford on the other hand, have many dealers who have GT's in their inventory that cost ten times the amount of their normal single car or truck. Many of these cars were purchased without customer orders on speculation. Some allocation were drawn by lotery. The typical Ford dealer who is financially strapped cannot afford to floorplan (finance) these cars for very long. They can basically make the equivalent of ten sales with one sale. I own two Ferraris (have owned four), and now two GT's. Both GT's were purchased from "desparate" dealers who needed to "bail" on these high ticket cars. My Ferrari dealer on the other hand has told me that I have to wait several years for a new 599 Fiorano (if I can even get one at all!) Demand has always out-paced supply for Ferrari, even when there are another 9,999 F-360 coupes out there besides mine! On another note, I think the Ford GT is a better car, more fun to drive, and more user-friendly. If I could only own one exotic I would keep the Ford GT! :thumbsup

 

[prmoldoaks]

I had to pay a premium for My GT here in the UK, it finally cost me $250,000 with all the duties involved.

If you import a GT to the UK this is how it works :

Say new GT at $160,000
Shipping Costs (Container) $ 2,000
Marine insurance 1% $ 1,600
UK Import Duty 10% $ 16,000
UK IMPORT TAX 17.5% $ 30,000
UK Port Delivery $ 500
UK Road Conversions $ 8,325

Total Cost $218,425 and thats pretty cheap)

So still not cheap here in UK although some dealers have got some pre-recall 2005 units for sale at around £129,000 ($238,000)

This is the current going rate here, but not many buyers because they are all left hand drives and limited market, although the rest of europe is ok with left hand drive, but the import costs are just as expensive dam tax kills it.

 

[shesgotlegs]

Who Cares??????????

If you purchased the GT to worry about the price direction, you probably purchased it for the wrong reasons.

I love my GT, its a thing of Beauty and people in the UK just cant stop looking at it and commenting look at those tires!!!!!

If it went down $100,000 dollars great I'd buy another one and thrash the hell out of it, If it goes up $100,000 it wont make me sell or stop driving it.

I bought the GT and have written off the cash from day one, but fallen in love for the second time in my life :willy

Ditto.

 

[GTx]

When the GT was first introduced they were selling for up to 100k over sticker. I have a friend who owns a LM dealership and bought one for at least 50k over 2005 sticker (prior to the 10k up charge). :biggrin

Right now we are at the "fat" point on the bell curve. There is plenty of supply as production ends (new, used and in private ownership) and this has affected the psyche of several of the dealers. Also Ford is hurting right now. SUV/Truck sales down as much as 47%. If you owned a dealership and had a zillion SUV's you would be anxious to sell anything (my guess is you make money on new cars as long as you sell a zillion of them).

I think we are a long way from these cars appreciating however I am confident the depreciating part will not be painful (they will not depreciate quickly).

Lastly there have been several Ferraris that have dropped like rocks after they hit the market if they were not well received, Ferrari is still a car company like everyone else. If they fall out of fashion the laws of supply and demand effect them too! :cheers

 

[canuck]

Most of us who have bought a Ford GT are a little more savvy than the average car buyer. Do you think Paris Hilton or the equivalents know anything about cars other than a Ferrari,"it's hot". Ferrari is as more about image than the car. Don't get me wrong , obviously not all Ferrari owners are in it for the image. Ferrari has always been close to if not at the pinnacle of race car development. But that is what they do best and mass production of vehicles with reasonably reliability is not Ferrari's forte. For that matter Porsche went to the Japanese to teach them to mass produce cars with reliability. A friend of mine correctly once stated that when you buy a new Ferrari you are making a sizable donation to Shue's salary and f1 Ferrari development. The car is not truly mechanically worth that amount. But factor in the other things such as resale value, exclusivity and association/statement of status with a car like this and that is what makes a Ferrari retain its value until the next generation is released. I have never in my life though driven a car who's suspension is so absolutely perfectly tuned until the GT. The seats are absolute art with functionality to match. They are an architectural marvel. The beauty of the GT is finding value where others have failed to find it. That is what makes anyone who bought one, one savvy/lucky car buyer. If the rest of the world saw what we did I certainly would never been lucky enough to have one. Even at that I was extremely fortunate to get one. Because the mass population has failed to see what we did in the GT the car will continue to depreciate for 10 years or for as many years as you care to speculate. Interestingly one of the best or least depreciating cars used to be the previous generation Viper.

 

[FB GT40]

Anyone who bought a GT for “investment” won’t do well. The value may drop for a while but stabilize in time. I don’t care one way or the other. I bought it to drive. :biggrin Having played with lots of cars over the years – I’ve never had the same experience as I have with the GT. True car magic! Ford has proven that they can design and develope a very fine automobile, very quickly. (Salutes to the GT Team!! :thumbsup ) They could do the same for a luxury car – but unfortunately the Ford dealer network would screw it up. They (the dealers) are not “car guys” (for the most part) – they are just out to make the biggest, quickest, buck they can. They just happen to be selling car and trucks. After all that said…I have bought 8 Fords in the last 12 years – with all levels of dealer service.

Gordo.

 

[scylla6]

I sold/traded a Ferrari Daytona Spyder (conv) for my GT. I have to say that I am very happy with the GT. All is well in this the best of all possible worlds. Now does anyone know where that line is from?
Tom

 

[Gene Cassone]

I totally agree with TimCantwell about the difference in dealers. That is how Ferreris and Fords are sold. I personally believe the way Ford handled which dealers got allocated cars was ludicrous. Many dealers got allocated cars because they were "president" dealers. They received one car. If they were lucky to receive it early in 2005 they auctioned it off on e-bay and made a bundle. Otherwise they were stuck with the car, sometime very small rural dealership, without a buyer. They could not afford to keep it in their inventory so either sold it below MSRP or to another dealer. Ferrari dealers are located in affluent areas, they have recuurent customers on a list to buy every new modal that is made and are comfortable with the thought they can sell it for a profit after paying list from the dealer.
I own a 67 Ferrari spyder, unique and beautifull (1 of 100). New Ferraris are always surpassed by the next model. Not so with the GT. The GT is relatively rare (compared to modern V* Ferraris) and oh so beautifull!! I believe the value will only improve!!
One last observation. I have been to many Ferrari gatherings. I am done after the Dearborn meet! To many owners showing off there status symbol! You guys are true enthusiasts. GT all the way!!