2005 Mustang GT Orders May Not Be Filled
4/4/05, 05:44 PM
#1
The Mustang Source FOUNDER
Thread Starter
Join Date: January 29, 2004
Location: Vestavia Hills, Ala.
Posts: 9,887
Likes: 0
Received 11 Likes
on
10 Posts
Source: Automotive News
--------------------------------------------------------------
By Amy Wilson
Automotive News / April 04, 2005 / By Amy Wilson
Orders for a Mustang GT might not be filled before the model year ends.
DETROIT -- As problems go, this is a pretty good one to have. Still, Ford Motor Co. sales executives are having a devil of a time figuring out how to feed America's raging Mustang fever.
From affluent teenagers to nostalgic baby boomers, buyers are clamoring for the retro-styled 2005 Mustang. Incentives are nonexistent, dealers are turning pony cars from their lots in three weeks, and Ford is raking in profits.
So what's the problem? Ford vastly underestimated the appetite for snazzy interior upgrades and the GT model's 300-hp V-8 engine. And Ford's ability to crank up production of those options is limited.
That creates other challenges. For instance, how does Ford equitably allocate cars to dealerships? And how do dealerships retain eager, cash-in-hand customers when they might not be able to fill an order for the rest of model year?
Although the GT is the hottest Mustang, the V-6 is selling briskly as well. It takes a dealer an average of only 11 days to turn a GT - but the turn time for a V-6 is a still-quick 22 days, Ford says.
Some dealers are turning to extreme measures to get Mustangs.
Bill Summers Ford in North Platte, Neb., bid more than sticker price for two used Mustang GTs in one week. And the dealership, which has taken delivery of only one 2005 Mustang so far, still didn't win the auctions.
"I got so angry I walked away," said used-car manager Matt Smith after bidding on a red GT with 5,307 miles at a March 24 Manheim auction in Denver. The car, which had an original sticker price of around $27,000, according to dealers, ended up selling wholesale for $29,900.
Paying over sticker for a used car sounds crazy. But Smith said customers are so eager for Mustangs that dealers can recoup their money. "On a daily basis, we have someone calling and looking for a GT," he said.
Martin Gubbels of Big Sky Ford-Lincoln-Mercury in Torrington, Wyo., was prepared to sacrifice his only 2005 Mustang convertible allocation to satisfy a long-standing retail order on a GT coupe. In the end, he didn't have to. Facing a long wait for the car, the coupe customer backed out.
Gubbels sold the convertible at full sticker price to a customer who qualifies for Ford's X-plan discount price but didn't want to wait for an X-plan order to be scheduled.
John Nielsen of Nielsen Ford-Mercury in Bloomer, Wis., recently bought a GT from another dealer for $100 less than the sticker price. He sold the car at sticker, making no money in the deal but showing Ford that he can move Mustangs.
"We were trying to earn allocation so we could get these retail orders in the order bank," Nielsen said.
But Nielsen is among hundreds of dealers who probably won't get all their GT orders filled during the waning months of the model year. The sales mix is already 38 percent GT, compared with around 33 percent GT in past years. But the unscheduled order bank contains almost 61 percent GTs, Ford says.
"It's safe to say demand is well above our ability to supply it at this point," said George Pipas, Ford's sales analysis and reporting manager.
There is a positive side to all this, Ford executives say. Pent-up demand should keep the redesigned Mustang strong well beyond its launch year
"While some customers are going to have to wait," Pipas said, "it smoothes out the period of strong sales for the product, which means you can avoid putting on higher incentives for a longer period of time."
Dealers are delighted to have the redesigned Mustang, especially since Ford's car stable has been so weak in recent years. But some are grumbling about allocation. Ford's smallest dealers may only get a few Mustangs for the entire model year. Some have been told not to expect any more GTs.
Ford guaranteed at least one 2005 Mustang to each of its 3,500 U.S. dealers. The automaker's "turn and earn" philosophy means the bulk of allocation has gone to metropolitan stores and dealers in the Sunbelt states, where a rear-drive sports car sells even in the winter.
"I would like to see more of them come to rural dealers because the Mustang is a hot product on every street corner in America, not just metropolitan areas," Gubbels said.
With the start of spring, Ford is shifting more deliveries to the northern states.
Ford is "allocating Mustang based on previous dealer sales," said Ben Poore, Ford Division car marketing manager. "We've got to allocate in the fairest way possible."
Ford already has pumped up capacity for the Mustang's interior upgrade package, which features an aluminum-covered dash and customized instrument panel lighting. Demand is nearly 50 percent, compared with a take rate originally forecast to be in the teens. The aluminum dash supplier added robots in February, and Ford says it now is closer to meeting demand.
Poore also says Ford is working on turning up GT production any way it can. He wouldn't give specifics on how much output could rise.
"We'll get up as high as we can within the boundaries of our engine capacity and axle capacity," he said.
Ford says it will build at least 192,000 Mustangs this year in part by scheduling overtime at its Mazda joint venture plant in Flat Rock, Mich. Ford expects to sell up to 165,000 Mustangs in the United States and 10,000 or more in Canada in 2005.
But dealers and customers shouldn't expect the mix to swing wildly to the GT, which shares its 4.6-liter engine with other Ford vehicles - notably the F-150 pickup. The automaker isn't likely to sacrifice higher-margin F-150 sales for more Mustang GTs.
The Romeo, Mich., engine plant, which makes the V-8, is not currently on overtime.
Ford already increased prices in January, something the company says was planned before the car went on sale in October. The base GT jumped from $24,995, including destination charges, to $25,570. The base V-6 went from $19,410 to $19,770.
The average selling price on a 2005 Mustang in February was $23,480, according to industry researcher Edmunds.com. For the 2005 model year, the average Mustang is selling for $27 below the sticker price, Ford says. Dealers can make more on eBay, where some GTs are selling for more than sticker price.
The shortage of GTs mean lost income for Ford dealers, who already saw profits slide in 2004 and early this year. "If we could get the right number of GTs, it would mean increased profits for Ford Motor Co., and some of the dealer profit problems will be worked out," Gubbels said. "But you can only sell what they can build."
--------------------------------------------------------------
By Amy Wilson
Automotive News / April 04, 2005 / By Amy Wilson
Orders for a Mustang GT might not be filled before the model year ends.
DETROIT -- As problems go, this is a pretty good one to have. Still, Ford Motor Co. sales executives are having a devil of a time figuring out how to feed America's raging Mustang fever.
From affluent teenagers to nostalgic baby boomers, buyers are clamoring for the retro-styled 2005 Mustang. Incentives are nonexistent, dealers are turning pony cars from their lots in three weeks, and Ford is raking in profits.
So what's the problem? Ford vastly underestimated the appetite for snazzy interior upgrades and the GT model's 300-hp V-8 engine. And Ford's ability to crank up production of those options is limited.
That creates other challenges. For instance, how does Ford equitably allocate cars to dealerships? And how do dealerships retain eager, cash-in-hand customers when they might not be able to fill an order for the rest of model year?
Although the GT is the hottest Mustang, the V-6 is selling briskly as well. It takes a dealer an average of only 11 days to turn a GT - but the turn time for a V-6 is a still-quick 22 days, Ford says.
Some dealers are turning to extreme measures to get Mustangs.
Bill Summers Ford in North Platte, Neb., bid more than sticker price for two used Mustang GTs in one week. And the dealership, which has taken delivery of only one 2005 Mustang so far, still didn't win the auctions.
"I got so angry I walked away," said used-car manager Matt Smith after bidding on a red GT with 5,307 miles at a March 24 Manheim auction in Denver. The car, which had an original sticker price of around $27,000, according to dealers, ended up selling wholesale for $29,900.
Paying over sticker for a used car sounds crazy. But Smith said customers are so eager for Mustangs that dealers can recoup their money. "On a daily basis, we have someone calling and looking for a GT," he said.
Martin Gubbels of Big Sky Ford-Lincoln-Mercury in Torrington, Wyo., was prepared to sacrifice his only 2005 Mustang convertible allocation to satisfy a long-standing retail order on a GT coupe. In the end, he didn't have to. Facing a long wait for the car, the coupe customer backed out.
Gubbels sold the convertible at full sticker price to a customer who qualifies for Ford's X-plan discount price but didn't want to wait for an X-plan order to be scheduled.
John Nielsen of Nielsen Ford-Mercury in Bloomer, Wis., recently bought a GT from another dealer for $100 less than the sticker price. He sold the car at sticker, making no money in the deal but showing Ford that he can move Mustangs.
"We were trying to earn allocation so we could get these retail orders in the order bank," Nielsen said.
But Nielsen is among hundreds of dealers who probably won't get all their GT orders filled during the waning months of the model year. The sales mix is already 38 percent GT, compared with around 33 percent GT in past years. But the unscheduled order bank contains almost 61 percent GTs, Ford says.
"It's safe to say demand is well above our ability to supply it at this point," said George Pipas, Ford's sales analysis and reporting manager.
There is a positive side to all this, Ford executives say. Pent-up demand should keep the redesigned Mustang strong well beyond its launch year
"While some customers are going to have to wait," Pipas said, "it smoothes out the period of strong sales for the product, which means you can avoid putting on higher incentives for a longer period of time."
Dealers are delighted to have the redesigned Mustang, especially since Ford's car stable has been so weak in recent years. But some are grumbling about allocation. Ford's smallest dealers may only get a few Mustangs for the entire model year. Some have been told not to expect any more GTs.
Ford guaranteed at least one 2005 Mustang to each of its 3,500 U.S. dealers. The automaker's "turn and earn" philosophy means the bulk of allocation has gone to metropolitan stores and dealers in the Sunbelt states, where a rear-drive sports car sells even in the winter.
"I would like to see more of them come to rural dealers because the Mustang is a hot product on every street corner in America, not just metropolitan areas," Gubbels said.
With the start of spring, Ford is shifting more deliveries to the northern states.
Ford is "allocating Mustang based on previous dealer sales," said Ben Poore, Ford Division car marketing manager. "We've got to allocate in the fairest way possible."
Ford already has pumped up capacity for the Mustang's interior upgrade package, which features an aluminum-covered dash and customized instrument panel lighting. Demand is nearly 50 percent, compared with a take rate originally forecast to be in the teens. The aluminum dash supplier added robots in February, and Ford says it now is closer to meeting demand.
Poore also says Ford is working on turning up GT production any way it can. He wouldn't give specifics on how much output could rise.
"We'll get up as high as we can within the boundaries of our engine capacity and axle capacity," he said.
Ford says it will build at least 192,000 Mustangs this year in part by scheduling overtime at its Mazda joint venture plant in Flat Rock, Mich. Ford expects to sell up to 165,000 Mustangs in the United States and 10,000 or more in Canada in 2005.
But dealers and customers shouldn't expect the mix to swing wildly to the GT, which shares its 4.6-liter engine with other Ford vehicles - notably the F-150 pickup. The automaker isn't likely to sacrifice higher-margin F-150 sales for more Mustang GTs.
The Romeo, Mich., engine plant, which makes the V-8, is not currently on overtime.
Ford already increased prices in January, something the company says was planned before the car went on sale in October. The base GT jumped from $24,995, including destination charges, to $25,570. The base V-6 went from $19,410 to $19,770.
The average selling price on a 2005 Mustang in February was $23,480, according to industry researcher Edmunds.com. For the 2005 model year, the average Mustang is selling for $27 below the sticker price, Ford says. Dealers can make more on eBay, where some GTs are selling for more than sticker price.
The shortage of GTs mean lost income for Ford dealers, who already saw profits slide in 2004 and early this year. "If we could get the right number of GTs, it would mean increased profits for Ford Motor Co., and some of the dealer profit problems will be worked out," Gubbels said. "But you can only sell what they can build."
4/4/05, 06:02 PM
#3
Member
Join Date: October 13, 2004
Posts: 42
Likes: 0
Received 0 Likes
on
0 Posts
I see an '06 (or maybe an '07) in my future. :notnice:
Unless... does anyone know of a body/engine/suspension kit to convert a 2004/2005 GTO to a 2005 Mustang? Ok, I could live with the 5.7 or 6.0 and IRS - just a body kit - anyone?
Unless... does anyone know of a body/engine/suspension kit to convert a 2004/2005 GTO to a 2005 Mustang? Ok, I could live with the 5.7 or 6.0 and IRS - just a body kit - anyone?
4/4/05, 06:04 PM
#4
Mach 1 Member
Join Date: January 12, 2005
Posts: 671
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by TheMustangSource@April 4, 2005, 5:47 PM
Martin Gubbels of Big Sky Ford-Lincoln-Mercury in Torrington, Wyo., was prepared to sacrifice his only 2005 Mustang convertible allocation to satisfy a long-standing retail order on a GT coupe.
Martin Gubbels of Big Sky Ford-Lincoln-Mercury in Torrington, Wyo., was prepared to sacrifice his only 2005 Mustang convertible allocation to satisfy a long-standing retail order on a GT coupe.
4/4/05, 07:55 PM
#8
Mach 1 Member
Join Date: January 12, 2005
Posts: 671
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by McDGT@April 4, 2005, 6:51 PM
And does that make 05's less common and more valuable?
And does that make 05's less common and more valuable?
4/4/05, 08:09 PM
#9
Bullitt Member
Join Date: February 19, 2005
Posts: 425
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by nullzor@April 4, 2005, 5:48 PM
so do u guys think that theyll move the 05 orders onto the 06 models?
so do u guys think that theyll move the 05 orders onto the 06 models?
Very sad news for those who have been patiently waiting all this time. I feel for them.
4/4/05, 09:57 PM
#11
V6 Member
Join Date: January 13, 2005
Posts: 84
Likes: 0
Received 0 Likes
on
0 Posts
oh man this stinks =(
If im scheduled to be pulled April 28th will my car get built? =\
I would hate to be waiting 99 days to pe pulled and not even get built as a 05...torch red isnt even offered next year
If im scheduled to be pulled April 28th will my car get built? =\
I would hate to be waiting 99 days to pe pulled and not even get built as a 05...torch red isnt even offered next year
4/4/05, 10:06 PM
#13
V6 Member
Join Date: February 2, 2005
Posts: 72
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by Adrenal+April 4, 2005, 10:12 PM--><div class='quotetop'>QUOTE(Adrenal @ April 4, 2005, 10:12 PM)</div><div class='quotemain'><!--QuoteBegin-nullzor@April 4, 2005, 5:48 PM
so do u guys think that theyll move the 05 orders onto the 06 models?
so do u guys think that theyll move the 05 orders onto the 06 models?
Very sad news for those who have been patiently waiting all this time. I feel for them.
[/b][/quote]
05 orders will be given the option to get an 06 and keep their place in line....that would only make sense...that's how my dealer is doing it.
4/4/05, 10:31 PM
#14
Bullitt Member
Join Date: May 19, 2004
Posts: 469
Likes: 0
Received 0 Likes
on
0 Posts
Well at least what we already knew is in writing now. Ford has really botched this launch and hasn't done much to fix it. I am really disappointed. It is a good thing that there isn't any competition in the affordable muscle car segment right now, or Ford would have major problems. Actually, maybe they would care more and start making more GTs!!! :bang: :bang: :bang:
4/4/05, 11:41 PM
#15
Member
Join Date: February 19, 2005
Posts: 25
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by HeHateMe@April 4, 2005, 3:05 PM
I see an '06 (or maybe an '07) in my future. :notnice:
I see an '06 (or maybe an '07) in my future. :notnice:
4/5/05, 12:06 AM
#16
Team Mustang Source
For me it's this 05 or nothing.
If there is no vehicle available this summer I
would be hard pressed to talk myself into giving Ford $42k
next summer. There is no way I'm putting myself through this again.
If there is no vehicle available this summer I
would be hard pressed to talk myself into giving Ford $42k
next summer. There is no way I'm putting myself through this again.
4/5/05, 02:52 AM
#18
Team Mustang Source
Join Date: August 18, 2004
Location: Jacksonville, FL
Posts: 586
Likes: 0
Received 0 Likes
on
0 Posts
I'd rather have an 06 than an 05 truthfully. With all the little glitches this model year I think it'd be wise to wait. Especially when you now have guys putting in over time to get the 05's through.
The body style is the same either way right?
The body style is the same either way right?
4/5/05, 06:59 AM
#20
Bullitt Member
Join Date: December 20, 2004
Posts: 280
Likes: 0
Received 0 Likes
on
0 Posts
Originally posted by bryman@April 4, 2005, 10:34 PM
Well at least what we already knew is in writing now. Ford has really botched this launch and hasn't done much to fix it. I am really disappointed. It is a good thing that there isn't any competition in the affordable muscle car segment right now, or Ford would have major problems. Actually, maybe they would care more and start making more GTs!!! :bang: :bang: :bang:
Well at least what we already knew is in writing now. Ford has really botched this launch and hasn't done much to fix it. I am really disappointed. It is a good thing that there isn't any competition in the affordable muscle car segment right now, or Ford would have major problems. Actually, maybe they would care more and start making more GTs!!! :bang: :bang: :bang:
Why do you think they "botched" it? Everyone is saying that they knew the car would be a good seller.....but not THAT good. It seems they had the year scheduled based on previous year purchases (ie 33% GT and the rest V-6). Now, We can all sit in our comfy chairs and use our hindsight binoculars to say "Well Mr. Ford...you shoulda known the GT would be more popular or that the IUP would be in everyone's Christmas stocking". Unfortunatley Ford can only "predict" what they are going to sell by previous years. I know it's hard as for us to sit around and wait for our cars....or.....pay over sticker to unscrupulous dealers but it's not Fords fault. They didn't just hit a home run....they hit a grand slam and now they have to wait for everyone else to run the bases. I look at it this way....There is no free lunch. If you want a nice house in a nice area in a nice city...you are gonna pay a "nice" amount. If you want the hottest car made this year that the dealers can't even keep on the lot long enough to wash...well, you see where it's going.
Jay