Porsche Cracking Down on Flippers?
05-27-2017, 12:28 PM
#107
Rennlist Member
^I agree re MSRP and frankly if we'd never gotten either build slot I would have been happy to keep my Cayman R which I loved. And we could live without an RS or just be patient and find the right one (same for GT4 if I couldn't build one)
Life would still be great either way. No complaints here!!!
Life would still be great either way. No complaints here!!!
05-27-2017, 02:27 PM
#108
Drifting
Supply constraints creating artificial demand and "collectability" is the core of the problem.
The limited edition 911R is the poster child. Porsche adversted the crap out of a car that I and other loyal customers had zero chance of getting. I was honestly insulted enough to bail on the brand, and I did until the 991 GT3 came along. However if I'd been lucky enough to get an allocation I couldn't have afforded to drive it properly anyway: my income tax bracket lets me enjoy a 150k car, but not ignore a potential 200k+ windfall.
Artificial scarcity promotes a Ferrari-like culture of bubbles and buffing, where the expectation of depreciation creates the exact opposite- a "use it or lose it" attitude. And the difference comes down to perception- even some of Porsche's best cars, i.e. the Boxster Spyder, are not going up because they're not "limited supply" even when built in small numbers.
I'd seriously consider cutting out numbered editions if I were Porsche, and I'd increase production flexibility to add more cars to a high demand model's run when needed. Care should be taken to avoid precipitous depreciation, but likewise significant appreciation is just as damaging in the long run. Because Porsche will have lost the core of its identity the moment it ceases making cars real drivers can truely use, and to use a car it must be both accessible and financially sane to do so.
The limited edition 911R is the poster child. Porsche adversted the crap out of a car that I and other loyal customers had zero chance of getting. I was honestly insulted enough to bail on the brand, and I did until the 991 GT3 came along. However if I'd been lucky enough to get an allocation I couldn't have afforded to drive it properly anyway: my income tax bracket lets me enjoy a 150k car, but not ignore a potential 200k+ windfall.
Artificial scarcity promotes a Ferrari-like culture of bubbles and buffing, where the expectation of depreciation creates the exact opposite- a "use it or lose it" attitude. And the difference comes down to perception- even some of Porsche's best cars, i.e. the Boxster Spyder, are not going up because they're not "limited supply" even when built in small numbers.
I'd seriously consider cutting out numbered editions if I were Porsche, and I'd increase production flexibility to add more cars to a high demand model's run when needed. Care should be taken to avoid precipitous depreciation, but likewise significant appreciation is just as damaging in the long run. Because Porsche will have lost the core of its identity the moment it ceases making cars real drivers can truely use, and to use a car it must be both accessible and financially sane to do so.
It's not if but when Mcalren Lamborghini etc retain their customers.
05-27-2017, 02:56 PM
#109
Best perspective on here is CJ, and I think he is the only one who is actually a dealer. I would not have guessed that GT allocations are not influenced by how many Macan/Cayenne, but rather how many 911s are sold. My dealer says they are selling fewer and fewer 911 with the mini me (my words, not his
) turbocharged motors. It sure seems like fewer enthusiasts are buying these base 911s now....
Jim
) turbocharged motors. It sure seems like fewer enthusiasts are buying these base 911s now....Jim
05-27-2017, 03:33 PM
#111
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This is what happened to me with Ferrari. I was told how their process works to get the most interesting cars - Buy multiple mainstream cars for years, and maybe they'd let you buy one of the amazing ones.
After considering sinking $500K - $1MM into cars I didn't want, only to arrive where I wanted, I jumped to Porsche.
My initial experience wasn't much better, I bought a used 991 GT3 to start, because I couldn't get allocation. Then a dealer came though - and the rest is history. I've bought 4 Porsches since the jump. I spoke with the Ferrari dealership owner, and he couldn't care less. I guess he's got all the buyers he needs.
As for the current system - it's OK, not great. I've gotten GT3 allocations, but never a GT3RS.
We'll see what the future brings - the GT2RS will be an interesting test. I'm "#1" at my local dealer for a GT2RS - I don't think I'll see one though.
05-27-2017, 03:44 PM
#112
Rennlist Member
Which is what a car is SUPPOSED to do. That would also eliminated 48% of the posts on here about pricing/value.
The questions are; what caused this, and more importantly, how can this situation be corrected?
Imagine if GT cars had a depreciation curve like an AMG, MAC, BMW. How many people here would not have purchased a GT car? How many here would not be able to trade in their 3 year old GT car for the price they paid for it and be guaranteed top spot in the next GT car? How many people here would be flipping their car?
This is NOT a supply or demand issue.
This is NOT a dealer issue.
This is NOT a flipper issue.
A complete change in the GT market / buyer philosophy would change it. Make GT cars depreciate as they are SUPPOSED to and every single issue relating to supply/demand/ADM/stealerships/flipping will be rectified.
The questions are; what caused this, and more importantly, how can this situation be corrected?
Imagine if GT cars had a depreciation curve like an AMG, MAC, BMW. How many people here would not have purchased a GT car? How many here would not be able to trade in their 3 year old GT car for the price they paid for it and be guaranteed top spot in the next GT car? How many people here would be flipping their car?
This is NOT a supply or demand issue.
This is NOT a dealer issue.
This is NOT a flipper issue.
A complete change in the GT market / buyer philosophy would change it. Make GT cars depreciate as they are SUPPOSED to and every single issue relating to supply/demand/ADM/stealerships/flipping will be rectified.
A depreciation curve cannot be 'made'. The market itself sets that curve.
A dealer 'could' influence that a bit, by offering more for trade ins or less for trade ins.
Dealers are the one that set the market price, both wholesale and retail. If someone trade in a Porsche in a Ferrari dealership, the Ferrari dealership would likely call around other Porsche dealerships to check on wholesale prices. That's what set the bottom of 2nd hand pricing.
Well the reason GT cars have a 'not normal' curve is that many many people wants the latest and greatest AND be the first on their block with such a car, that's why they are willing to pay whatever markup to be first. Especially when the said car is a limited or hard to get car.
They are the ones that don't mind and support the dealers 'market adjustments'.
Now since the first guy was in it for so much already, AND there is a long list of people wanting such a car, the dealer would 'pay up' to get such a car back to resale. The early adopters and dealers basically created and supported the inflated pricing.
05-27-2017, 04:27 PM
#113
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Here's a suggestion...create an "GT Enthusiast" VIP program.
1. A reasonable initiation fee paid directly to PCNA to join. 3-5 year term. Member will select preferred dealer at the time of acceptance.
2. Ability to pre-order new GT cars one month prior to release. Cars will be sold at MSRP through preferred dealer. Maximum of one car per model, two cars per year.
3. PCNA will hold the title for 18-24 months, preventing change of ownership. If member wants to sell their car during this period, they agree to return to dealership at 80-85% of MSRP (or percentage of market). Member can also return car at this rate to obtain an additional allocation if they have already purchased the maximum number of vehicles allowed during a one year period.
4. At the expiration of 18-24 months, if vehicle has less than 2,500 miles, vehicle must be returned to dealership in exchange for 90% of market price. If vehicle has greater than 2,500 miles, dealership has first right of refusal for an additional six months. After 24-30 months, owner is free to sell at market price.
5. Members will have access to six to eight exclusive events per year, i.e. track days, new model releases, meet and greets, etc. Members will also have access to PTS and other exclusive options.
6. Abuse of the program will lead to immediate dismissal. Dealer principals, resellers, etc. will not be allowed to participate. Exceptions will be considered in the case of theft or accident.
By allowing true enthusiasts with access to the cars they want, and providing Porsche with a true window into the demand for their vehicles, I think this program could be a win-win.
I've purchased four vehicles in the past 16 months, a 2015 GT3, 2015 Cayenne Turbo, 2016 GT3RS, and 2017 Macan GTS. The only vehicle I no longer own is the 2015 GT3. Being the customer of a smaller dealership, I genuinely feel like I have a slim chance of receiving a 991.2 RS at MSRP, unless I trade in my 991.1 RS at some ridiculous number (i.e. $35-40K under market). I don't think a loyal customer that owns multiple Porsches should be stuck in that predicament.
Feel free to make suggestions/changes, but I think this is a start...
1. A reasonable initiation fee paid directly to PCNA to join. 3-5 year term. Member will select preferred dealer at the time of acceptance.
2. Ability to pre-order new GT cars one month prior to release. Cars will be sold at MSRP through preferred dealer. Maximum of one car per model, two cars per year.
3. PCNA will hold the title for 18-24 months, preventing change of ownership. If member wants to sell their car during this period, they agree to return to dealership at 80-85% of MSRP (or percentage of market). Member can also return car at this rate to obtain an additional allocation if they have already purchased the maximum number of vehicles allowed during a one year period.
4. At the expiration of 18-24 months, if vehicle has less than 2,500 miles, vehicle must be returned to dealership in exchange for 90% of market price. If vehicle has greater than 2,500 miles, dealership has first right of refusal for an additional six months. After 24-30 months, owner is free to sell at market price.
5. Members will have access to six to eight exclusive events per year, i.e. track days, new model releases, meet and greets, etc. Members will also have access to PTS and other exclusive options.
6. Abuse of the program will lead to immediate dismissal. Dealer principals, resellers, etc. will not be allowed to participate. Exceptions will be considered in the case of theft or accident.
By allowing true enthusiasts with access to the cars they want, and providing Porsche with a true window into the demand for their vehicles, I think this program could be a win-win.
I've purchased four vehicles in the past 16 months, a 2015 GT3, 2015 Cayenne Turbo, 2016 GT3RS, and 2017 Macan GTS. The only vehicle I no longer own is the 2015 GT3. Being the customer of a smaller dealership, I genuinely feel like I have a slim chance of receiving a 991.2 RS at MSRP, unless I trade in my 991.1 RS at some ridiculous number (i.e. $35-40K under market). I don't think a loyal customer that owns multiple Porsches should be stuck in that predicament.
Feel free to make suggestions/changes, but I think this is a start...
05-27-2017, 05:02 PM
#114
Rennlist Member
Sheesh.
Glad I have a good local dealer and a great salesman. Some of you guys are gluttons for punishment. Flipping P-cars and holding mileage down and having to really work for an allocation just doesn't sound very fun. I can't handle it personally.
I like Porsche GT cars, but I grew up and continue to like Vettes and now the new Camaros especially this upcoming ZL1 1LE. Get one for 10-20% off after the hype dies down and just run the **** out of it and put 40k miles on it and sell it for a $20k loss or so to purchase price. Rinse and repeat. Life is short. Have fun.
I wouldn't even remotely consider my upcoming .2 GT3 if I had to pay an ADM or call all over the country to find an allocation. They are awesome cars, but there are a lot of other options nowadays. You obsessed P-car guys are what creates this speculative secondary market.
Glad I have a good local dealer and a great salesman. Some of you guys are gluttons for punishment. Flipping P-cars and holding mileage down and having to really work for an allocation just doesn't sound very fun. I can't handle it personally.
I like Porsche GT cars, but I grew up and continue to like Vettes and now the new Camaros especially this upcoming ZL1 1LE. Get one for 10-20% off after the hype dies down and just run the **** out of it and put 40k miles on it and sell it for a $20k loss or so to purchase price. Rinse and repeat. Life is short. Have fun.
I wouldn't even remotely consider my upcoming .2 GT3 if I had to pay an ADM or call all over the country to find an allocation. They are awesome cars, but there are a lot of other options nowadays. You obsessed P-car guys are what creates this speculative secondary market.
05-27-2017, 05:02 PM
#115
Rennlist Member
I think it is a well thought out plan. But here is the problem. Why should someone who has never purchased a Porsche have the same or better access to a GT car than someone who has bought several Porsche's from the same dealer?
The whole point of the GT program today is for dealers to reward their best customers with allocations and bring in high demand used GT cars. Porsche cannot and should accommodate all demands for their GT cars. Its what makes the GT cars desirable.
The whole point of the GT program today is for dealers to reward their best customers with allocations and bring in high demand used GT cars. Porsche cannot and should accommodate all demands for their GT cars. Its what makes the GT cars desirable.
05-27-2017, 05:06 PM
#116
Nordschleife Master
Originally Posted by Nick
The whole point of the GT program today is for dealers to reward their best customers with allocations and bring in high demand used GT cars. Porsche cannot and should accommodate all demands for their GT cars. Its what makes the GT cars desirable.
I'm pretty sure the GT program was not built to reward certain customers. The GT program builds great cars for people (in general) to buy. This whole 'elitism' thing is a shameful byproduct of the way dealers manage things and they way some snobby owners act.
05-27-2017, 05:15 PM
#117
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I think it is a well thought out plan. But here is the problem. Why should someone who has never purchased a Porsche have the same or better access to a GT car than someone who has bought several Porsche's from the same dealer?
The whole point of the GT program today is for dealers to reward their best customers with allocations and bring in high demand used GT cars. Porsche cannot and should accommodate all demands for their GT cars. Its what makes the GT cars desirable.
The whole point of the GT program today is for dealers to reward their best customers with allocations and bring in high demand used GT cars. Porsche cannot and should accommodate all demands for their GT cars. Its what makes the GT cars desirable.
If Porsche feels like the GT car is a reward for owning other vehicles, fine, make it a requirement to own 1-2 other Porsches, but I didn't buy my other cars to move up on my Dealer's list, I bought them because they are awesome.
05-27-2017, 05:28 PM
#118
The whole point of selling anything is for someone to buy it. The only qualification of the buyer should be money.
Can you imagine if you went to buy milk and the store owner said, we only sell milk to milk enthusiasts or people who REALLY like milk or people who drink it super duper fast?
The GT "game" is comical. Piece of cake if you're already on one side of the equation. Stomp on your ***** frustrating if you're on the other side.
05-27-2017, 05:42 PM
#119
IMO the GT3 should never be a "reward" car. Everyone who can afford and wants a GT3 should get one. NO demand-1 stuff, supply should equal demand. If you want to dangle the GT3RS, 997 RS 4.0 etc for the super awesome customers that's fine, but the base GT3 should be available for every track rat and back road dude that can cut the check.
05-27-2017, 06:00 PM
#120
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Wrong.
Right.
The whole point of selling anything is for someone to buy it. The only qualification of the buyer should be money.
Can you imagine if you went to buy milk and the store owner said, we only sell milk to milk enthusiasts or people who REALLY like milk or people who drink it super duper fast?
The GT "game" is comical. Piece of cake if you're already on one side of the equation. Stomp on your ***** frustrating if you're on the other side.
Right.
The whole point of selling anything is for someone to buy it. The only qualification of the buyer should be money.
Can you imagine if you went to buy milk and the store owner said, we only sell milk to milk enthusiasts or people who REALLY like milk or people who drink it super duper fast?
The GT "game" is comical. Piece of cake if you're already on one side of the equation. Stomp on your ***** frustrating if you're on the other side.
Think about it...how many people are on multiple lists? What percentage of them are flippers? In what way are the dealer's actions clouding Porsche's view?
A few hypothetical scenarios...
A. Say I'm #1 on the the list. Demand order is in. Dealer calls "It's your lucky day, you've got an allocation. The price is going to be MSRP plus $75K ADM." I get pissed off, refuse to pay the additional markup. Dealer moves down the list until they find someone willing to pay the markup. Was my demand order not legitimate? Am I not a "real" buyer? No, I just got skipped over due to dealer games. By the time this happens, it's probably too late to get on another dealership's list. Maybe I call 3-4 other dealers, they add me to their list. I'm not looking to buy 3-4 cars, just one. Porsche can't see that.
B. Small dealer is lucky if they get two RS allocations. They receive a call from a dealer in Los Angeles willing to pay $50K over MSRP for both of their allocations. Knowing that they will only receive two allocations, and have the opportunity to make a significant markup, they sell to the dealer in LA. I call about an allocation. "Sorry, we don't have any allocations." Am I going to pay $100K over MSRP from the dealer in LA? Probably not. End of story, demand not fulfilled.
You can say that both scenarios are the dealer's fault, and it would be hard to not be bitter about it. The issue is, a small dealer is struggling as-is, and has a hard time saying no to these scenarios. If you're talking $5-10K markups, I'm sure the dealer would make an exception for a local customer, as they'll easily make the difference back in Parts/Service/Accessories. When you get into these $50-75K markups, the dealer knows you're never going to spend $50K+ in service over the span of two years. You get skipped.
My suggestion of an enthusiast program would allow an opportunity to those that want to drive GT cars, and show Porsche exactly who they are. No games, no BS.