A place to discuss all things ADM
#4756
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
It's interesting to note that while chip companies are swimming in inventory of memory chips, the chips that go into automobiles are still in tight supply and difficult to source.
These are chips that have extremely long lead times (26 weeks) due to their complexity. During Covid, chip suppliers diverted resources away from automotive and towards consumer electronics given people working from home. But demand for new vehicles was more resilient than expected during the shutdowns and chip suppliers were still continuing to divert resources away from automotive. It made for a horrible supply/demand situation.
Fast forward to 2023 and these traditional automotive chip suppliers are still trying to play "catch-up".
In other news:
Wolfspeed to build $3-bln EV chip plant in Germany, subsidy approval expected in months | Reuters
These are chips that have extremely long lead times (26 weeks) due to their complexity. During Covid, chip suppliers diverted resources away from automotive and towards consumer electronics given people working from home. But demand for new vehicles was more resilient than expected during the shutdowns and chip suppliers were still continuing to divert resources away from automotive. It made for a horrible supply/demand situation.
Fast forward to 2023 and these traditional automotive chip suppliers are still trying to play "catch-up".
In other news:
Wolfspeed to build $3-bln EV chip plant in Germany, subsidy approval expected in months | Reuters
basically, the electronics guys are like the Porsche dealer and Porsche is getting a taste of its own medicine. Walk away from your MSRP allocation ? Don’t threaten me with a good time reselling it at a new market level. ********. Oh, you want it back ? Bro, that sold before you left my parking lot. You can get a new allocation in 9 months. $100k ADM because you were a dick. Don’t like it ? Lol. Good luck bitch.
The following 3 users liked this post by AlexCeres:
#4757
Race Car
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
"The value of semiconductors, at the chip level, in cars will grow from $34.4 billion in 2020 to $78.5 billion in 2026, a 14.75% CAGR (compound annual growth rate),” said Eric Mounier, director of market research at Yole Développement (Yole). “The largest growth will be in EVs due to the major shift to electrification.”
The root cause of the current shortage was the mismanagement of capacity due to the unknown optics from the COVID-19 pandemic, causing many automakers to cut or halt capacity because they were unsure of market demand. When demand returned, capacity had moved elsewhere, and shortages emerged. The shortage was also not helped by lockdowns and issues at the supply chain due to the initial outbreak of COVID-19.
Intel already predicted that by 2030, about 20% of the total vehicle cost will come from semiconductors, but the rapid inclusion of chips in vehicles will impact the supply chain due to China intensifying the competition and investing massively in semiconductors in the automotive industry, Yole said.
Yole forecasts:
The root cause of the current shortage was the mismanagement of capacity due to the unknown optics from the COVID-19 pandemic, causing many automakers to cut or halt capacity because they were unsure of market demand. When demand returned, capacity had moved elsewhere, and shortages emerged. The shortage was also not helped by lockdowns and issues at the supply chain due to the initial outbreak of COVID-19.
Intel already predicted that by 2030, about 20% of the total vehicle cost will come from semiconductors, but the rapid inclusion of chips in vehicles will impact the supply chain due to China intensifying the competition and investing massively in semiconductors in the automotive industry, Yole said.
Yole forecasts:
- Connectivity in the automotive industry will rise to $55 billion in 2026.
- Advanced driver assistance systems (ADAS) will reach more than $60 billion by 2026.
- Sharing will reach $3 billion by 2026.
- Electrification will reach $28 billion in 2026
- By 2035, connectivity, ADAS, sharing and electrification (CASE) will be a $318 billion market.
The following users liked this post:
AlexCeres (02-03-2023)
#4758
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
That’s what I said! Lol.
Other industries are switching to using fewer more expensive and capable semiconductors instead of a swarm of old cheap ****. Much easier to source buying off the shelf the same kinds of things your tv, dishwasher, etc all want. Doubt the automotive industry will follow quickly, but probably eventually. In the meantime, they’ll have to subsidize the semiconductor industry to build more capacity for the old chips they want. I have a tough time seeing them doing so to the tune of 20% of the bom though. That seems more like intel wishing it had a future
Other industries are switching to using fewer more expensive and capable semiconductors instead of a swarm of old cheap ****. Much easier to source buying off the shelf the same kinds of things your tv, dishwasher, etc all want. Doubt the automotive industry will follow quickly, but probably eventually. In the meantime, they’ll have to subsidize the semiconductor industry to build more capacity for the old chips they want. I have a tough time seeing them doing so to the tune of 20% of the bom though. That seems more like intel wishing it had a future
#4759
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
For all the folks thinking that the bumps in the economy are going to scare all the whales away and ANY DAY NOW Porsche dealers will be offering them massive discounts. No. Just no. Rich people are going to be okay
https://www.cnbc.com/2023/02/02/ferr...-guidance.html
https://www.cnbc.com/2023/02/02/ferr...-guidance.html
#4760
Rennlist Member
Join Date: May 2012
Location: Mid-Atlantic (on land, not in the middle of the ocean)
Posts: 13,286
Received 4,472 Likes
on
2,547 Posts
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
For all the folks thinking that the bumps in the economy are going to scare all the whales away and ANY DAY NOW Porsche dealers will be offering them massive discounts. No. Just no. Rich people are going to be okay
https://www.cnbc.com/2023/02/02/ferr...-guidance.html
https://www.cnbc.com/2023/02/02/ferr...-guidance.html
The following users liked this post:
Carlo_Carrera (02-03-2023)
#4761
Racer
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
The thing with Porsche whales is that they get their cars early. Anyone buying a GT3 now is far less likely to be a money-no-object buyer because those guys would've already just paid the markup and moved on, or gotten a deal due to their purchase history. After that there's a large contingent of buyers who may be ok with paying a markup to get what they want, but they have limits. Those buyers might see softening prices and decide to wait a bit, which will further soften prices. But I think there's enough people who really want a car and haven't gotten one yet that prices won't fall all the way down to sticker across the board. Maybe if we get a real recession.
The following 3 users liked this post by G.Irish:
#4762
Race Car
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
The U.S. Unemployment Rate hit a 54 year low today of 3.4% and 517,000 jobs were added in January.
#4763
Rennlist Member
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
No one who's buying or selling something should be maligned for trying to get the best deal they can, provided that they're not doing anything fraudulent. Porsche dealers have been making big profits not because of collusion or intentional market distortion, but because enough of us buyers are bidding up the prices to get the cars. And I don't blame Porsche for not gearing up to increase supply if they're trying to balance long-term supply and demand (or have slight excess demand) and believe that we're currently in a demand bubble, which I think we are. I do expect demand and prices to come down, but it may take more than a year or a substantial fear-inducing recession for that to happen.
On another note, why should there be market pricing at all for new cars? It's really not good for Porsche (customers don't want to play games and be jerked around, that doesn't build affection for a brand long-term, and manufacturers want long-term buyers more than anything) and it's not good for the enthusiast community. There are countries where dealers are not allowed to mark-up cars and the dealers still make a fine profit.
The following users liked this post:
usctrojanGT3 (02-03-2023)
#4764
RL Community Team
Rennlist Member
Rennlist Member
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
The elephant in the room with having Porsche control price of cars, or taking away a dealer's ability to adjust MSRP, is that do you really want to pay MSRP for a base Cayman? Or a base Panamera?
And, yes, I know, I know, the easy response is, "well I don't buy Caymans and Panameras, so who cares." Well, then it just means you're going to get sucked into the Ferrari model, i.e., you buy a 911, sell it back to dealer at cost, so dealer gets to sell it as a "used" car for whatever price it wants, and then dealer will allow you to buy a GT car at MSRP.
No thank you.
As distasteful as ADMs may be, I'd rather just pay the extra $$ directly, and cut out the middle man. Transaction costs suck.
And, yes, I know, I know, the easy response is, "well I don't buy Caymans and Panameras, so who cares." Well, then it just means you're going to get sucked into the Ferrari model, i.e., you buy a 911, sell it back to dealer at cost, so dealer gets to sell it as a "used" car for whatever price it wants, and then dealer will allow you to buy a GT car at MSRP.
No thank you.
As distasteful as ADMs may be, I'd rather just pay the extra $$ directly, and cut out the middle man. Transaction costs suck.
The following users liked this post:
AlexCeres (02-04-2023)
#4765
Burning Brakes
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
demand pricing allows those that value the item the most to acquire the product and it allocates the scarce product. This does in fact give the first time Porsche buyer the ability to own a new Porsche of their choice. Plus, when the buyer acquires the car, they don't instantly have a profit and why should the profit not inure to Porsche or at least the dealer rather than a speculator customer? What Porsche should do is simply price the cars from the factory to demand and vary the pricing until the cars sit on the dealer floor until a customer comes along that feels the pricing is fair in their mind. THe prices of eggs fluctuate with demand daily same with the cost at a restaurant often these days or the cost for an insurance policy. If dealers today could not mark up any vehicles over MSRP than the only clients that would get an allocation for a new GT3 would be ones that have bought other cars from the dealer or that have bought watches from the dealer (which I did) or that the dealer knows will continue to buy Porsche vehicles due to an addiction year after year.
The guys that hate ADM pricing essentially are annoyed they cannot buy their toy with a built in profit and are focused more on flipping the car for a profit than on owning and using the vehicle.
Without ADM pricing the speculators would expand exponentially in numbers making it even harder to get an allocation.
Today you either pay the ADM as a new customer with no track record with the dealer or the dealer values your business in the past and expects also in to sell you cars in the future -- mostly the ones that depreciate. They need a customer base that will still buy cars in the depth of the recession that might be on the horizon and they value your loyalty.
If I was a dealer personally I would only sell the hot cars to customers that will also service the car with my dealership. If you sell a GT3 to a fellow 1,000 miles away your losing the opportunity to charge $600 oil changes from the vehicle.
Also doing what COrvette did on the Z06-- if you sell it within six months the factory warranty is canceled. Even a year would be a good time period.
After you buy a new Porsche ideally it would be worth what you paid for some period of time and then decline as you wear the car out.
Dealers make extra money by market pricing in the good times but are any of us going to send a check to the dealer when car loans are 10% and the fear of being unemployed for many possible buyers becomes real such that they stop buying expensive new cars and their sales man are not earning a decent wage and the inventory is bloated costing them flooring interest? I don't think so. It balances out for the dealers -- hopefully in the good times they can store up some extra profit to keep the business afloat in the bad economic times. Many Porsche dealers likely have used cars they bought that are now worth less than their investment-- I doubt any of us will volunteer to pay their cost on a vehicle which is only worth 80% of what the dealer paid.
The guys that hate ADM pricing essentially are annoyed they cannot buy their toy with a built in profit and are focused more on flipping the car for a profit than on owning and using the vehicle.
Without ADM pricing the speculators would expand exponentially in numbers making it even harder to get an allocation.
Today you either pay the ADM as a new customer with no track record with the dealer or the dealer values your business in the past and expects also in to sell you cars in the future -- mostly the ones that depreciate. They need a customer base that will still buy cars in the depth of the recession that might be on the horizon and they value your loyalty.
If I was a dealer personally I would only sell the hot cars to customers that will also service the car with my dealership. If you sell a GT3 to a fellow 1,000 miles away your losing the opportunity to charge $600 oil changes from the vehicle.
Also doing what COrvette did on the Z06-- if you sell it within six months the factory warranty is canceled. Even a year would be a good time period.
After you buy a new Porsche ideally it would be worth what you paid for some period of time and then decline as you wear the car out.
Dealers make extra money by market pricing in the good times but are any of us going to send a check to the dealer when car loans are 10% and the fear of being unemployed for many possible buyers becomes real such that they stop buying expensive new cars and their sales man are not earning a decent wage and the inventory is bloated costing them flooring interest? I don't think so. It balances out for the dealers -- hopefully in the good times they can store up some extra profit to keep the business afloat in the bad economic times. Many Porsche dealers likely have used cars they bought that are now worth less than their investment-- I doubt any of us will volunteer to pay their cost on a vehicle which is only worth 80% of what the dealer paid.
The following users liked this post:
AlexCeres (02-04-2023)
#4766
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
Diablo, please tell me you dont belive those job add stats today, do you???
#4767
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
The elephant in the room with having Porsche control price of cars, or taking away a dealer's ability to adjust MSRP, is that do you really want to pay MSRP for a base Cayman? Or a base Panamera?
And, yes, I know, I know, the easy response is, "well I don't buy Caymans and Panameras, so who cares." Well, then it just means you're going to get sucked into the Ferrari model, i.e., you buy a 911, sell it back to dealer at cost, so dealer gets to sell it as a "used" car for whatever price it wants, and then dealer will allow you to buy a GT car at MSRP.
No thank you.
As distasteful as ADMs may be, I'd rather just pay the extra $$ directly, and cut out the middle man. Transaction costs suck.
And, yes, I know, I know, the easy response is, "well I don't buy Caymans and Panameras, so who cares." Well, then it just means you're going to get sucked into the Ferrari model, i.e., you buy a 911, sell it back to dealer at cost, so dealer gets to sell it as a "used" car for whatever price it wants, and then dealer will allow you to buy a GT car at MSRP.
No thank you.
As distasteful as ADMs may be, I'd rather just pay the extra $$ directly, and cut out the middle man. Transaction costs suck.
Last edited by WCGhost; 02-04-2023 at 03:10 PM.
The following users liked this post:
AlexCeres (02-04-2023)
#4768
Burning Brakes
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
Rolex does not control who a Rolex dealer sells too - they in fact do what many Porsche guys would like - they require that their dealers sell all new watches at msrp or lower but never above.
so the dealer can sell to any customer they select for any given watch. So generally they sell the in demand watches to the customers of their shop that are continual buyers of jewelry from their business. Any one reading this post would do exactly the same.
This is not “unfair” as that shop has overhead and inventory costs and insurance to pay and on and on and building their customer base with long term customers is good for their business.
when I was a stock broker back in the late 1970’s and we would get a “hot” issue underwriting and I was allocated shares - say 300 shares of Amazon - a start up online bookstore- That seemed destined to rise sharply after the initial sale - I gave 50 shares to six of my best customers so they could take the nearly guaranteed profit of $5 a share and the client could take his wife out to a nice dinner.
And this allocation model was consistent down the line- if a securities firm helped the lead underwriter sell shares of their last several utility underwriting then our firm would receive an invitation to be in the syndicate for this “hot” issue. Then the offices in our firm received an allocation of shares based on how many shares of the difficult to sell underwritings underwritten by the firm. And then per my note above / shares were allocated to the broker that helped the office sell the shares of these difficult to sell shares - often secondary underwritings for utility companies. And then I allocated the small number of shares I received as an allocation the same way.
Rolex allocates more of the easy to sell watches - GMT blue dial and Daytona stainless or left handed green dial GMT to their dealers that sell more of the Daydates or Cillini. So when you buy a 38mm basic Daydate you are helping the dealer keep their franchise from Rolex and get allocated more of the easy in demand watches.
Same with Porsche dealers - Porsche “likes” dealers that sell more Panamera’s and SUV’s and base Carreras and their watches for $7,500 or their bikes for $10,000 and will allocate more of the GT3’s and GT4’s and Club Sport and now the Dakar.
additionally you have to be a real collector not just a guy who wants to flip a watch or a car at an immediate profit. In the case of Rolex if Rolex finds that a lot of watches sold by a particular dealer end up as new stock at grey market dealers that dealer will lose thier franchise.
It isn’t a game that dealers of cars or watches make you play out of spite but just the realities of how allocation of scare product is allocated to him.
I buy my wife jewelry for birthdays and Xmas from a shop I have gotten to know well and I get good pricing and great service on both jewelry and an occasional Zolex and I also get offered allocations from several Porsche dealers and I have never paid a markup on any Porsche vehicle. But I do buy lots of other Porsche stuff like accessories and watches and non-gt cars now and then from my Porsche SA - even when getting the car serviced I at the dealer it costs me more than a local independent shop but this additional income helps motivate the dealers management to give me an allocation for a car I want and often in front of guys that simply called up one day and asked to be on a list for a new 911 T or a GT4. I was helpful to the dealer in getting more of these higher profit margin allocations for their dealer.
so the next time it is your wife’s birthday - go to a Rolex dealer and buy her a bracelet for the same price you would pay for a similar piece at a jewelry store that is not a dealer for Rolex. Or do the same with a selected Porsche dealer. Instead of buying a Toyota suv for your wife - buy her an MDX Acura or a Toyota Rave etc. - buy her a Macon. I make an effort to refer friends that want a Porsche to the dealer you are building a relationship with as well. Not even your money!
send them YouTube videos on new model Rolex or Porsche products - I send them a box of See’s Candies at Xmas time. Yep - I stoop to that low. But what happens is they “remember” me - my name eventually sticks in their minds and when they are about to call some guy I receive calls on an allocation when they need to select a customer. Is that so surprising.
I send my Rolex guy - photos of my Rolex watches all together and aI send my Porsche dealer video of the cars he sold me at PCA events or driving on a canyon road etc. I make myself familiar to these decision makers - and often they have a handful of possible buyers they call me simply because they remember my name - they make two calls and no answers so instead they tell their staff “call Mike” see if he wants that Rolex Submariner or GT3. A combination of being familiar with the dealer and the sales associates and with management and having given them some sales in other products that helped them manage their inventory.
Build a relationship with your dealer. Not a game-but it is the consequence of these products having market value above the price a dealer will charge you. Nothing is really free.
also If you are a fanboy of a particular scarce watch or car you will enjoy having a more personal relationship with a sales man that is knowledgeable about the product you enjoy discussing.
There is no free lunch …..
alrernatively - pay a dealer $100,000 over the window sticker for a Porsche or buy the Rolex you want from a secondary market at a marked up price that creates an immediate inventory for those that need immediate gratification.
These situations with allocation of scarce products is not contrived to be punitive - they represent the reality that we live in a capitalist market place.
so the dealer can sell to any customer they select for any given watch. So generally they sell the in demand watches to the customers of their shop that are continual buyers of jewelry from their business. Any one reading this post would do exactly the same.
This is not “unfair” as that shop has overhead and inventory costs and insurance to pay and on and on and building their customer base with long term customers is good for their business.
when I was a stock broker back in the late 1970’s and we would get a “hot” issue underwriting and I was allocated shares - say 300 shares of Amazon - a start up online bookstore- That seemed destined to rise sharply after the initial sale - I gave 50 shares to six of my best customers so they could take the nearly guaranteed profit of $5 a share and the client could take his wife out to a nice dinner.
And this allocation model was consistent down the line- if a securities firm helped the lead underwriter sell shares of their last several utility underwriting then our firm would receive an invitation to be in the syndicate for this “hot” issue. Then the offices in our firm received an allocation of shares based on how many shares of the difficult to sell underwritings underwritten by the firm. And then per my note above / shares were allocated to the broker that helped the office sell the shares of these difficult to sell shares - often secondary underwritings for utility companies. And then I allocated the small number of shares I received as an allocation the same way.
Rolex allocates more of the easy to sell watches - GMT blue dial and Daytona stainless or left handed green dial GMT to their dealers that sell more of the Daydates or Cillini. So when you buy a 38mm basic Daydate you are helping the dealer keep their franchise from Rolex and get allocated more of the easy in demand watches.
Same with Porsche dealers - Porsche “likes” dealers that sell more Panamera’s and SUV’s and base Carreras and their watches for $7,500 or their bikes for $10,000 and will allocate more of the GT3’s and GT4’s and Club Sport and now the Dakar.
additionally you have to be a real collector not just a guy who wants to flip a watch or a car at an immediate profit. In the case of Rolex if Rolex finds that a lot of watches sold by a particular dealer end up as new stock at grey market dealers that dealer will lose thier franchise.
It isn’t a game that dealers of cars or watches make you play out of spite but just the realities of how allocation of scare product is allocated to him.
I buy my wife jewelry for birthdays and Xmas from a shop I have gotten to know well and I get good pricing and great service on both jewelry and an occasional Zolex and I also get offered allocations from several Porsche dealers and I have never paid a markup on any Porsche vehicle. But I do buy lots of other Porsche stuff like accessories and watches and non-gt cars now and then from my Porsche SA - even when getting the car serviced I at the dealer it costs me more than a local independent shop but this additional income helps motivate the dealers management to give me an allocation for a car I want and often in front of guys that simply called up one day and asked to be on a list for a new 911 T or a GT4. I was helpful to the dealer in getting more of these higher profit margin allocations for their dealer.
so the next time it is your wife’s birthday - go to a Rolex dealer and buy her a bracelet for the same price you would pay for a similar piece at a jewelry store that is not a dealer for Rolex. Or do the same with a selected Porsche dealer. Instead of buying a Toyota suv for your wife - buy her an MDX Acura or a Toyota Rave etc. - buy her a Macon. I make an effort to refer friends that want a Porsche to the dealer you are building a relationship with as well. Not even your money!
send them YouTube videos on new model Rolex or Porsche products - I send them a box of See’s Candies at Xmas time. Yep - I stoop to that low. But what happens is they “remember” me - my name eventually sticks in their minds and when they are about to call some guy I receive calls on an allocation when they need to select a customer. Is that so surprising.
I send my Rolex guy - photos of my Rolex watches all together and aI send my Porsche dealer video of the cars he sold me at PCA events or driving on a canyon road etc. I make myself familiar to these decision makers - and often they have a handful of possible buyers they call me simply because they remember my name - they make two calls and no answers so instead they tell their staff “call Mike” see if he wants that Rolex Submariner or GT3. A combination of being familiar with the dealer and the sales associates and with management and having given them some sales in other products that helped them manage their inventory.
Build a relationship with your dealer. Not a game-but it is the consequence of these products having market value above the price a dealer will charge you. Nothing is really free.
also If you are a fanboy of a particular scarce watch or car you will enjoy having a more personal relationship with a sales man that is knowledgeable about the product you enjoy discussing.
There is no free lunch …..
alrernatively - pay a dealer $100,000 over the window sticker for a Porsche or buy the Rolex you want from a secondary market at a marked up price that creates an immediate inventory for those that need immediate gratification.
These situations with allocation of scarce products is not contrived to be punitive - they represent the reality that we live in a capitalist market place.
The following 7 users liked this post by Targa32:
AdzRacing (02-06-2023),
AlexCeres (02-04-2023),
Engro (02-04-2023),
malibuboy (02-06-2023),
usctrojanGT3 (02-04-2023),
and 2 others liked this post.
#4769
Rennlist Member
Join Date: May 2012
Location: Mid-Atlantic (on land, not in the middle of the ocean)
Posts: 13,286
Received 4,472 Likes
on
2,547 Posts
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
The following users liked this post:
993TurboS (02-04-2023)
#4770
![Default](https://rennlist.com/forums/images/icons/icon1.gif)
Rolex does not control who a Rolex dealer sells too - they in fact do what many Porsche guys would like - they require that their dealers sell all new watches at msrp or lower but never above.
so the dealer can sell to any customer they select for any given watch. So generally they sell the in demand watches to the customers of their shop that are continual buyers of jewelry from their business. Any one reading this post would do exactly the same.
This is not “unfair” as that shop has overhead and inventory costs and insurance to pay and on and on and building their customer base with long term customers is good for their business.
when I was a stock broker back in the late 1970’s and we would get a “hot” issue underwriting and I was allocated shares - say 300 shares of Amazon - a start up online bookstore- That seemed destined to rise sharply after the initial sale - I gave 50 shares to six of my best customers so they could take the nearly guaranteed profit of $5 a share and the client could take his wife out to a nice dinner.
And this allocation model was consistent down the line- if a securities firm helped the lead underwriter sell shares of their last several utility underwriting then our firm would receive an invitation to be in the syndicate for this “hot” issue. Then the offices in our firm received an allocation of shares based on how many shares of the difficult to sell underwritings underwritten by the firm. And then per my note above / shares were allocated to the broker that helped the office sell the shares of these difficult to sell shares - often secondary underwritings for utility companies. And then I allocated the small number of shares I received as an allocation the same way.
Rolex allocates more of the easy to sell watches - GMT blue dial and Daytona stainless or left handed green dial GMT to their dealers that sell more of the Daydates or Cillini. So when you buy a 38mm basic Daydate you are helping the dealer keep their franchise from Rolex and get allocated more of the easy in demand watches.
Same with Porsche dealers - Porsche “likes” dealers that sell more Panamera’s and SUV’s and base Carreras and their watches for $7,500 or their bikes for $10,000 and will allocate more of the GT3’s and GT4’s and Club Sport and now the Dakar.
additionally you have to be a real collector not just a guy who wants to flip a watch or a car at an immediate profit. In the case of Rolex if Rolex finds that a lot of watches sold by a particular dealer end up as new stock at grey market dealers that dealer will lose thier franchise.
It isn’t a game that dealers of cars or watches make you play out of spite but just the realities of how allocation of scare product is allocated to him.
I buy my wife jewelry for birthdays and Xmas from a shop I have gotten to know well and I get good pricing and great service on both jewelry and an occasional Zolex and I also get offered allocations from several Porsche dealers and I have never paid a markup on any Porsche vehicle. But I do buy lots of other Porsche stuff like accessories and watches and non-gt cars now and then from my Porsche SA - even when getting the car serviced I at the dealer it costs me more than a local independent shop but this additional income helps motivate the dealers management to give me an allocation for a car I want and often in front of guys that simply called up one day and asked to be on a list for a new 911 T or a GT4. I was helpful to the dealer in getting more of these higher profit margin allocations for their dealer.
so the next time it is your wife’s birthday - go to a Rolex dealer and buy her a bracelet for the same price you would pay for a similar piece at a jewelry store that is not a dealer for Rolex. Or do the same with a selected Porsche dealer. Instead of buying a Toyota suv for your wife - buy her an MDX Acura or a Toyota Rave etc. - buy her a Macon. I make an effort to refer friends that want a Porsche to the dealer you are building a relationship with as well. Not even your money!
send them YouTube videos on new model Rolex or Porsche products - I send them a box of See’s Candies at Xmas time. Yep - I stoop to that low. But what happens is they “remember” me - my name eventually sticks in their minds and when they are about to call some guy I receive calls on an allocation when they need to select a customer. Is that so surprising.
I send my Rolex guy - photos of my Rolex watches all together and aI send my Porsche dealer video of the cars he sold me at PCA events or driving on a canyon road etc. I make myself familiar to these decision makers - and often they have a handful of possible buyers they call me simply because they remember my name - they make two calls and no answers so instead they tell their staff “call Mike” see if he wants that Rolex Submariner or GT3. A combination of being familiar with the dealer and the sales associates and with management and having given them some sales in other products that helped them manage their inventory.
Build a relationship with your dealer. Not a game-but it is the consequence of these products having market value above the price a dealer will charge you. Nothing is really free.
also If you are a fanboy of a particular scarce watch or car you will enjoy having a more personal relationship with a sales man that is knowledgeable about the product you enjoy discussing.
There is no free lunch …..
alrernatively - pay a dealer $100,000 over the window sticker for a Porsche or buy the Rolex you want from a secondary market at a marked up price that creates an immediate inventory for those that need immediate gratification.
These situations with allocation of scarce products is not contrived to be punitive - they represent the reality that we live in a capitalist market place.
so the dealer can sell to any customer they select for any given watch. So generally they sell the in demand watches to the customers of their shop that are continual buyers of jewelry from their business. Any one reading this post would do exactly the same.
This is not “unfair” as that shop has overhead and inventory costs and insurance to pay and on and on and building their customer base with long term customers is good for their business.
when I was a stock broker back in the late 1970’s and we would get a “hot” issue underwriting and I was allocated shares - say 300 shares of Amazon - a start up online bookstore- That seemed destined to rise sharply after the initial sale - I gave 50 shares to six of my best customers so they could take the nearly guaranteed profit of $5 a share and the client could take his wife out to a nice dinner.
And this allocation model was consistent down the line- if a securities firm helped the lead underwriter sell shares of their last several utility underwriting then our firm would receive an invitation to be in the syndicate for this “hot” issue. Then the offices in our firm received an allocation of shares based on how many shares of the difficult to sell underwritings underwritten by the firm. And then per my note above / shares were allocated to the broker that helped the office sell the shares of these difficult to sell shares - often secondary underwritings for utility companies. And then I allocated the small number of shares I received as an allocation the same way.
Rolex allocates more of the easy to sell watches - GMT blue dial and Daytona stainless or left handed green dial GMT to their dealers that sell more of the Daydates or Cillini. So when you buy a 38mm basic Daydate you are helping the dealer keep their franchise from Rolex and get allocated more of the easy in demand watches.
Same with Porsche dealers - Porsche “likes” dealers that sell more Panamera’s and SUV’s and base Carreras and their watches for $7,500 or their bikes for $10,000 and will allocate more of the GT3’s and GT4’s and Club Sport and now the Dakar.
additionally you have to be a real collector not just a guy who wants to flip a watch or a car at an immediate profit. In the case of Rolex if Rolex finds that a lot of watches sold by a particular dealer end up as new stock at grey market dealers that dealer will lose thier franchise.
It isn’t a game that dealers of cars or watches make you play out of spite but just the realities of how allocation of scare product is allocated to him.
I buy my wife jewelry for birthdays and Xmas from a shop I have gotten to know well and I get good pricing and great service on both jewelry and an occasional Zolex and I also get offered allocations from several Porsche dealers and I have never paid a markup on any Porsche vehicle. But I do buy lots of other Porsche stuff like accessories and watches and non-gt cars now and then from my Porsche SA - even when getting the car serviced I at the dealer it costs me more than a local independent shop but this additional income helps motivate the dealers management to give me an allocation for a car I want and often in front of guys that simply called up one day and asked to be on a list for a new 911 T or a GT4. I was helpful to the dealer in getting more of these higher profit margin allocations for their dealer.
so the next time it is your wife’s birthday - go to a Rolex dealer and buy her a bracelet for the same price you would pay for a similar piece at a jewelry store that is not a dealer for Rolex. Or do the same with a selected Porsche dealer. Instead of buying a Toyota suv for your wife - buy her an MDX Acura or a Toyota Rave etc. - buy her a Macon. I make an effort to refer friends that want a Porsche to the dealer you are building a relationship with as well. Not even your money!
send them YouTube videos on new model Rolex or Porsche products - I send them a box of See’s Candies at Xmas time. Yep - I stoop to that low. But what happens is they “remember” me - my name eventually sticks in their minds and when they are about to call some guy I receive calls on an allocation when they need to select a customer. Is that so surprising.
I send my Rolex guy - photos of my Rolex watches all together and aI send my Porsche dealer video of the cars he sold me at PCA events or driving on a canyon road etc. I make myself familiar to these decision makers - and often they have a handful of possible buyers they call me simply because they remember my name - they make two calls and no answers so instead they tell their staff “call Mike” see if he wants that Rolex Submariner or GT3. A combination of being familiar with the dealer and the sales associates and with management and having given them some sales in other products that helped them manage their inventory.
Build a relationship with your dealer. Not a game-but it is the consequence of these products having market value above the price a dealer will charge you. Nothing is really free.
also If you are a fanboy of a particular scarce watch or car you will enjoy having a more personal relationship with a sales man that is knowledgeable about the product you enjoy discussing.
There is no free lunch …..
alrernatively - pay a dealer $100,000 over the window sticker for a Porsche or buy the Rolex you want from a secondary market at a marked up price that creates an immediate inventory for those that need immediate gratification.
These situations with allocation of scarce products is not contrived to be punitive - they represent the reality that we live in a capitalist market place.