jay72

This is true. Its all a matter of time. Look at what the dealer has to pay in floorplanning in the meantime. The longer they sit with them the less money they make. I would imagine it costs them anywhere from $100-$300 per car a day to have them. This is why I believe dealers are moving them at discounted prices. It may take awhile for this to happen. Here in S. Florida there are about 8-10 new CGTs available. S. Florida is a strong market and there is still cars around. So I agree with you but it may take awhile for this to happen.



Jay

W8MM

Yes, but as the supply dries up, dealers with remaining new cars will be more likely to get MSRP. If the game is to make a profit, the accumulating floor plan interest expense requires an ever-higher price to compensate. It's sort of a reverse race to see who can hold out longest. Sitting on a car for 100 days to get MSRP at your speculated rates is cheaper than taking $50,000 hair cut to sell it now.

Here's another consideration: What if the financially strongest dealers use there own money and not a bank's? They will find it difficult to earn a market rate of return for their extra cash as high as what a bank would charge for floor plan money. That means their inventory opportunity costs of tying up their own cash will be lower than a "weaker" competitor who has no cash as retained earnings, and has to use bank money. Therefore they can "out-last" the weaker dealers in sitting on inventory until the prices comes back up due to shrinking availability.

yetis

As for floor plan interest, most dealers (car dealers in general) get 60 days of essentially "interest free" financing for their inventory. I am not sure what Porsche dealers have. The point is that the number is not tied to a specific car. Porsche just posted it biggest sales month in history, meaning that Porsche is moving cars a lot faster than 60 days. So, they could actually be making money on the floor interest benefit as it adds to margin. So, if you are blowing through $70k caymans and $90k 911's, you could easily see how a Porsche dealer can support a CGT for a several months, maybe a year.

Bob Rouleau

Three comments - I agree with Colm that greed was an important factor, but I would spread the blame a little farther. There are quite a few people who speculate on exotic cars. Ferrari manages this in a rather unique way, but Porsche did not. I know several people who put up deposits simply to flip the car for an anticipated profit. That practice created artificial demand. When it became evident that there was a plentiful supply.. they folded and went away. I have no sympathy for them.

On floor plans - manufacturer floor plans are usually interest only until the model year changes, at that point, capital has to be re-imbursed. depending on a dealer's cash position, I'd expect a dealer with a couple of CGT's in stock would prefer to sell the car before he has to fork over a lot of money.

I'm also puzzled at the low margins on the CGT - I am told it was the same on the GT2 as well. The dealer has to make a substantial investment in tools and training - not to mention parts to support the car. I suspect that any dealer who sold one CGT, even at sticker probably lost money.

Regards,

hacker-pschorr

I love Porsche’s, never cared much for Ferrari’s so this is not a Porsche bashing post. IMO Porsche is not known as a supercar builder. The 911 is old reliable in the sportscar world, it’s what Porsche is known for (well, now SUV’s). When most car guys (and more so, non car people) think of Porsche, it does not hold the prestige, the exclusivity that Ferrari has. I was in LA recently at some steak house (don’t ask where I wasn’t driving). 996TT were pulling up to Valet, being parked around back with the Bentley’s and Mercedes. Every Ferrari that pulled up (even an old but very nice 308) was given a spot in front, parked by the cars owner. We all know places pick the nicer cars to “show off” the front of the place. A bright red Ferrari draws more eyes than a 911 even well.

What does this have to do with the CGT? Perception. People simply do not associate “Porsche” the same as they do “Ferrari”. The average Joe has heard the stories that if you want the most reliable, well rounded car, buy a Porsche. If you want that kick in the pants performance, head snapping girl waving attention, you buy a Ferrari. Even if this means the Ferrari spends 75% of its life in the shop.

I know people in the PCA who are not life long car nuts – have reached that point in life where they can shell out $70k for a toy and pick up a 911. I’m still amazed how excited they get when they see a 308 Ferrari. They are like “Wow, someday I’ll have something like that!” They think I’m nuts when I inform them they could have bought two for the price of their 911 – they simply do not know these things. Anyone out of the car loop assumes a Ferrari is a Ferrari and a first mortgage is needed to buy one. Porsche’s are “affordable”. It doesn’t help that the 944 was ever made, sure it kept the company in business during the 80’s, but the damage it did on Porsches reputation is still hurting them. Not to mention I’m willing to bet anyone who is not much of a car aficionado still thinks the 911 is based on the VW. I was asked more than once if my 2000 Beetle shared anything with the 911 – I’m not kidding – this was at Road America for Christ sake.

Even if they only made 400 CGT’s the Enzo would still be more exclusive, holding its value over time. Personally I would take a CGT over an Enzo any day of the week, but I’m biased towards all things Porsche.
There are so many supercars out there now, some cheaper with a more exclusive name than “Porsche”. It doesn’t surprise me these are sitting on dealer showrooms.

Bob Rouleau

Hacker - supercars that languish in the showroom are not limited to Porsche, the new SLR is a slug, the Jag XK 220 was a failure - they had to sue buyers to get them to take the cars they had contracted for. By those standards the CGT has done rather well. As Colm said, had they stuck to the original 500, the car would be almost as desirable as an Enzo.

I think Mike is right, as the supply dries up the car will become more desirable. 1250 cars was not a two year supply it was a four year supply. I predict the market will stabilize and prices increase.

hacker-pschorr

Bob, I see your point and I'm not trying to come off as some expert, just a life long car guy making an observation. The Mercedes IMO falls into the same hole as the CGT. Shelling out $500k for a Benz vs. a Ferrari, even with the McLaren named stamped on is a tough pill to swallow.

The XK220 was plagued with many issues (not just the car itself) funny this would come up. A thread in OT we have been discussing the downfall of the 220 for a few days now. But again, Jaguar is not known for supercars, they do not have the “Ferrari” prestige. Not to mention a last minute engine swap and the supercar market was already slipping, helped kill the 220 before it was ever alive.

I look at the Ferrari F40 - even with the extra units built, they are still fetching a high dollar amount. The F50's are still worth half-million (not sure how many were made though).

It will be interesting to see if Lamborghini actually builds the Miura as an Enzo fighter with a price tag of $400k+. Lambo’s are hot right now, having always been considered a very exclusive auto.

I’m not trying to argue, just laying things out as I see it. I really hate to say this, but I have to. At a recent PCA event a silver CGT was lapping the track. I overheard a group down the fence say that was the new Boxster. It took every last bit of restraint in my body to keep from smacking the **** out of them.

Nick

Those of you who believe the CGT price will go up are smoking something.

Hacker is right. Porsche is not noted for supercars. They make a terrific midpriced sport car. The 997TT is reputed to be faster than the CGt around the Hochehiem course and will out accelerate it up to 62mph. It is priced at $120,000. The problem with the CGT is without the performance advantage, it does not have the other intangibles which will make it a very desireable car for collectors.

However, I agree the price will stabilize but before that happens more people like Les and Mike (they plan to hold on to the CGT) will have to buy the car. That may not happen for a very long time. With each day, the warranty clock ticks and after four years, maintenance on the car will be for only the super rich.

icon

porsche produced the 959 in 1986
ferrari came out with the f40 in 1987

cgt's are selling at a rate of about 10-12 a month right now so should easily sell out by the end of the year.
after dealers sell out i think the price will stabilize and resale will be a lot better than a few people think!

icon

but why do you buy a certain car? for perception? image?
or performance?
why worry about image?
i think resale is important (because i'm a tightwad), but not image for a performance car.

a friend of mine has both the enzo and the cgt and says the only thing the enzo has over the cgt is paddle shifters, more comfortable seats, and the front end lift system. as far as performance he picks the cgt.
i've also seen this posted from others that own both. i've never seen or heard of someone preferring the enzo that had driven both cars for any length of time.

Bob Rouleau

Nick, you may be right. I was considering a CGT until the cost to repair surfaced. That sent me to the 430 camp, half the price (here anyway) and not stupidly expensive to maintain.

On the other hand, consider the 1997 993 Turbo S. When it came out, dealers had a hard time moving them. Porsche emptied out their parts bins of costly and useless accessories and loaded the car to the hilt. The price was (here) 50K higher than the non S - all for carbon fibre glue ons and a lousy 10 HP more. Today, the Turbo S is much sought after - go figure. By the way, I have no illusions that the CGT will be selling at a big premium in a few years, I do think they will float back to at or near the original sticker.

Hacker - thanks for the insight into the Jag 220 - that explains a lot. I am not a Jag fan, I admire the looks but that's as far as it goes. Other than Ferrari and the McLaren F1, how many other supercars made it? I suppose Zonda might count, but there aren't too many that did not come from Ferrari. Will the Veyron be a success and command over sticker prices?

I'm not so sure about the Lambo, in these parts you can buy one off the floor - a 430 is sold out for 4 years. The resale on the Lambo is a shock for the owner whereas the 430 command a premium.

I have to hand it to Ferrari, they are very good at creating demand for their cars, some of which were not very good at all.


Regards,

Nick

Jeff face facts. Every Ferrari is considered a supercar because of its image and strict exclusivity On the other hand, today Porsche is a main stream car manufacturer(it caters to every market segment) and as a result does not have any credibility in producing "supercars". It would be like Chevrolet producing a supercar (say what? ).

Ford has the same problem with the GT. It initially sold at a premium but now his leveling off and probably fall below MSRP.

Finally, if a car is going to distinguish itself on performance alone, as I believe the CGT does, then it better offer other something else (exclusivity, image etc.). Otherwise, it will never hold its value because performance can be bought for a hell of lot less and maintenance cheaper.

Therein lies the problem for the CGT.

hacker-pschorr

For many reasons, performance and quality are #1 to me. If I cared about perception or image I wouldn't be into 928's.

Oh c'mon - you cannot tell me at least 50% of every new Porsche owner isn't buying the crest on the hood? There is nothing wrong with that, but it is the truth. I think most people around Rennlist are a bit abnormal - in a good way.

I agree resale is very important in autos. To some people it must not be. I mean, look at most exotic / expensive cars. Buy a $150k Benz, you will be lucky to get $90k back in two years. That does not bother a lot of people. They are paying for the privilege of driving a brand new Mercedes.

This does not surprise me. It still does not change the fact that the Enzo was created by the same company who has won the last how many F1 championships. Is the most well known and recognized automobile manufacturer ever.

Bernie made an interesting quote a few years ago about Ferrari’s dominance of F1, I think it applies to this discussion. He said the whole point of F1 should be the rest of the world trying to catch Ferrari. Without Ferrari, there is no F1. (not word for word, but you get the point).

Les Quam

I have been considering the purchase of a Ford GT but every friend who has bought one that I know is very unhappy with the car. Ford has confirmed the press cars had chips and pulleys which is why they had the amazing performance. My friend has owned a 2006 for three weeks now and has had a ton of problems. So many in fact Ford is sending a tech to his house to pick the car up and bring it to the dealer for all the repairs. He is a writer for a car mag so he is getting the VIP treatment. He can't even drive his GT now because there is a huge oil leak in the seals for the supercharger. This goes along with the coolant leak and the fuel leak etc. The local Ford dealer crushed the belly pan when they jacked it up on the wrong spot. All the lugnuts were loose when delivered one of the seats was loose because one of the retainers was stripped at the factory and they then just drilled a new one into the aluminum. I could go on but you get the idea. Anyway that is one big reason the cars are not holding their value.

2005 Ford GTs can be bought for close to dealer cost and 2006s for 10K under MSRP.

I think CGTs in ten years will be selling in excess of MSRP. One of the reasons the 911s don't command a resale ratio like Ferraris is because they have evolved over the years with very liitle changes. The owner of a 1989 turbo gets much the same driving experience as the owner of a 1994 turbo as does the owner of a 1997 turbo. Many collectors just feel that Porsche has milked the 911 variant to the limit and there is no reason a 1989 turbo should command a premuim over a 1994 or 1997 or even a 2002 turbo.

The CGT is a two year only car and is not a 911 but stands alone. It is the only current supercar where the tops come off and it has a radio,nav,phone, etc. Quality and reliabality is unmatched by Ferrari.

Recently I have had a few friends try to buy both new and used 2005 low mile CGTs they were not able to find the kind of deals that people claim to hear about on this forum. One offered me 365K for my car and when I said no threw in an option to buy a rare Shelby. Another friend bought a 500 mile 2005 CGT in South Florida for 380K because he couldn't do any better after searching for a no story car. So perhaps the market is already firming up or perhaps my friends are poor searchers?

joe hayes

Just a quick reply to the comments from Les. I have an 05 Ford Gt. I bought it about one year ago and it has about 1200 miles. No problems at all so far. I have had it on the track for a couple of days and it performed well but as we all know it is a heavy car and you can feel the extra 300 or 400 pounds over a GT3. The other problem it seemed to have was that the rear gear should be lower, rather have it top out at 160 but get there faster. I felt Ford put out a pretty good product. I have a new ZO6 coming in about 30 days, it will be interesting to compare.