Dealer sales training to persuade Tesla buyers

7863 Views 39 Replies 18 Participants Last post by machstang, Aug 14, 2020

desertdrifter

Discussion Starter · Aug 11, 2020

Interesting to see how Ford is training sales people to prepare for the inevitable Mach-E vs Tesla comparisons.

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JTK44

· #2 · Aug 11, 2020

desertdrifter said:
View attachment 2176

Interesting to see how Ford is training sales people to prepare for the inevitable Mach-E vs Tesla comparisons.

What they need to do is completely junk the Ford Option plan, or keep it but let people know it is deferred purchase plan, and come up with a true lease that is competitive with other vehicles costing the same - not just Tesla but other cars both BEV and ICE that cost about $50,000.

After the salesmen go through their speech, the very next question will be "how much"?

Actually for me, the first question will be the monthly lease payments: I am old school: the MachE is a "want" and not a "need", so even before I will let the salesperson go into his "dog and pony" routine, I want to know the cost.

SD_Solar

· #3 · Aug 12, 2020

JTK44 said:
What they need to do is completely junk the Ford Option plan, or keep it but let people know it is deferred purchase plan, and come up with a true lease that is competitive with other vehicles costing the same - not just Tesla but other cars both BEV and ICE that cost about $50,000.

I obviously have no insider info on how Mach-E orders / demand is going, but with only about 15,000 units available for sale in the US over the next year, I expect Ford to maximize their profit on these thru Ford Financing and other cash purchases.

If next summer they do still have a few thousand available to move, then Ford may offer a lease deal / discount on those.

JTK44

· #4 · Aug 12, 2020

SD_Solar said:
I obviously have no insider info on how Mach-E orders / demand is going, but with only about 15,000 units available for sale in the US over the next year, I expect Ford to maximize their profit on these thru Ford Financing and other cash purchases.

If next summer they do still have a few thousand available to move, then Ford may offer a lease deal / discount on those.

Everyone is entitled to their own opinion and your estimation is as good, if not even better than mine.

In support of my position I refer you to BMW dealers with I3's sitting on their lot, Jaguar dealers with I-Pace's sitting on their lot and Audi dealers sitting with E-tron's sitting on their lot. All cost more, with shorter range than the Model Y and those dealers are used to having customers paying thousands of dollars more for other models they sell.

At $50,000 plus the MachE is a huge step up in price for Ford. At these price points, this is a totally different customer than the normal Ford customer. The MachE is priced at luxury or near luxury.

This is a specialty market dominated by Tesla. Both the MachE and the Model Y are far more expensive than comparable ICE. People who are looking at either the Model Y or the MachE want to go green. They know about the Model Y and they will compare the lease price of the Model Y to the MachE.

Again this just my opinion: Buying a MachE will not be a spur of the moment decision. It is not a $35,000 Chevy Bolt. I do not see people walking into a showroom, asking what car is that, and laying down between $50,000 and $60,000 without doing serious research including cost of the vehicle. Going from an ICE to a full BEV is commitment. You have to have a home charger, make concessions to range and give up the convenience of an ICE.

Plus there is the unknown of what the MachE, or any BEV, will be worth in few years as new models come out with longer range and faster charging time.

When you get above $50,000 leasing accounts for more than 50% of all sales.So in short people will be comparing the MachE to the Model Y and the lease price will be very important.

But I could be wrong: if there is no better lease plan other than the Ford Option Plan, when my First Edition arrives, my dealer should have no trouble selling it, as I will not be taking delivery.

.

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SD_Solar

· #5 · Aug 12, 2020

JTK44 said:
At $50,000 plus the MachE is a huge step up in price for Ford. At these price points, this is a totally different customer than the normal Ford customer. The MachE is priced at luxury or near luxury.

Actually, the “normal Ford customer” is a F150 / F250 truck buyer.

And if you add a few trim / engine / transmission upgrades, you will quickly blow past that $50,000 price point. Been there and done it several times.

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JTK44

· #6 · Aug 12, 2020 (Edited)

SD_Solar said:
Actually, the “normal Ford customer” is a F150 / F250 truck buyer.

And if you add a few trim / engine / transmission upgrades, you will quickly blow past that $50,000 price point. Been there and done it several times.

You are absolutely correct about the pricing of the F150/F250 truck.

The buyers of Tesla's have been coming out of BMW's, Audi's, Mercedes and other high end luxury cars.

I would think that would be the same demographic for the MachE.

ChasingCoral

· #7 · Aug 12, 2020

JTK44 said:
You are absolutely correct about the pricing of the F150/F250 truck.

Do you think that is going to be the buyer of a Mustang MachE?

The buyers of Tesla's have been coming out of BMW's, Audi's, Mercedes and other high end luxury cars.

I would think that would be the same demographic for the MachE.

I'm moving up from a Nissan Leaf and a Prius before that.

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eastern refugee

· #8 · Aug 12, 2020

My 2 cents. Most people buying the MME have owned fords previously. Everyone knows that the Y and 3 series are entry level. They are NOT the real Tesla. They are the equivalent of a Boxter to a Porsche buyer. I own a Porsche but not a real one.
MME has what Tesla dies not. It is not an entry level car but rather in a league of itself.

people buying the GT are those used to high performance mustangs and those are absolutely in the $50,000 plus range to a reasonable $75,000 range. They are buying the MME because it is both a high performance mustang and is flat out different.
I think that comparing the MME to the Tesla is way over rated. I wanted a BEV for years and yes I looked at Tesla but my issue is the only Tesla’s worth looking at in terms of getting what I feel is both comfort for a long drive and worth the money was either the S or X but at $80,000 plus I just could not justify it. The 3 and the y look cheap compared to the other 2.

the MME fascinated me from day 1. It was a ford and after sitting in it at the LA car show I was hooked. It is crazy comfortable and has the stuff I like. I would live a lease because I KNOW a Shelby version will likely be out in 3 years.

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peugfan

· #9 · Aug 12, 2020

JTK44 said:
What they need to do is completely junk the Ford Option plan, or keep it but let people know it is deferred purchase plan, and come up with a true lease that is competitive with other vehicles costing the same - not just Tesla but other cars both BEV and ICE that cost about $50,000.

After the salesmen go through their speech, the very next question will be "how much"?

Actually for me, the first question will be the monthly lease payments: I am old school: the MachE is a "want" and not a "need", so even before I will let the salesperson go into his "dog and pony" routine, I want to know the cost.

For me the MME lease terms are not relevant. I have never leased a car and have never seen the need to. I've always assumed that people lease cars because they can't afford to buy one. That's likely not a correct assumption. I am probably not the norm, but I tend to keep a car a long time as that usually results in the lowest cost per mile for depreciation. Maintenance costs rarely come close to the cost of depreciation and I do most of the maintenance myself. With the Mach-E I don't expect to do much maintenance myself, but I also don't expect there will be much maintenance. If I can't afford to put down about 70% of the vehicle's purchase in cash, I wait until I can. Yes, I give up having all of the latest tech, but that's fine. (My trusty Peugeot diesel does not even have an ECU computer). As to range, I bought the extended range battery so that even if I lost some range over time, I will still have ~200 miles. So my hopes are for a smaller low interest rate loan from Ford of say 0.9% like I got with my Lincoln MKX. As the saying goes, your mileage may vary.

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SD_Solar

· #10 · Aug 12, 2020

I hope Ford does get a fair number of buyers for the Mach-E from the Ford F Series sales which have been around 900,00 per year.
Ford would need only about 1.7% of them to buy up the entire US allotment of 15,000 Mach E's --- I'm one of them.

Jhalkias

· #11 · Aug 12, 2020

JTK44 said:
You are absolutely correct about the pricing of the F150/F250 truck.

The buyers of Tesla's have been coming out of BMW's, Audi's, Mercedes and other high end luxury cars.

I would think that would be the same demographic for the MachE.

I'm moving from a Ford Escape.

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timbop

· #12 · Aug 12, 2020

peugfan said:
I've always assumed that people lease cars because they can't afford to buy one. That's likely not a correct assumption.

I've only leased 2 cars before, one of those times explicitly because I figured the car (pontiac fiero) would lose more value than the lease's residual (which it did). In the case of a Mach E (or model 3 which is the other car I am considering), it is clear that 3-4 years from now there will be significant improvements in battery technology that will drive the resale value of a 2021 model down. I think Ford realizes this, which is one of the reasons why the residual/balloon values are so low. Tesla still seems to think that their cars will have a much better resale, which is why the lease terms are so much more attractive.

It is for the much more attractive payments (and the fact that I won't have to tie up $7500 for a year) that the model 3 is my current preference. If payments were the same (or at least within $25 or so), I would definitely go with the pony.

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JTK44

· #13 · Aug 12, 2020

timbop said:
I've only leased 2 cars before, one of those times explicitly because I figured the car (pontiac fiero) would lose more value than the lease's residual (which it did). In the case of a Mach E (or model 3 which is the other car I am considering), it is clear that 3-4 years from now there will be significant improvements in battery technology that will drive the resale value of a 2021 model down. I think Ford realizes this, which is one of the reasons why the residual/balloon values are so low. Tesla still seems to think that their cars will have a much better resale, which is why the lease terms are so much more attractive.

It is for the much more attractive payments (and the fact that I won't have to tie up $7500 for a year) that the model 3 is my current preference. If payments were the same (or at least within $25 or so), I would definitely go with the pony.

"it is clear that 3-4 years from now there will be significant improvements in battery technology that will drive the resale value of a 2021 model down."

There is an old adage which I believe definitely applies to BEV:

"Own an appreciating asset, rent a depreciating asset"

I have been leasing for over 35 years, not because I cannot afford to buy, but because I lease luxury cars which depreciate in three years much more than the residual and once out of warranty the maintenance costs can truly be scary.

With regard to both the Model 3 and Y, which do not offer a buy back option, but as compared to the Ford Option Plan monthly payments are much, much less, Musk thinks that in 3 to 4 years he will have fully (L5) autonomous driving up and running and will need a fleet of "robo taxis". Musk's plan calls for the robo taxis to be filled by Model 3's and Y's coming off lease.

Personally I think Musk is delusional, but I have been wrong about Musk before.

In any event, Musk's plan produces a much more competitive lease payment than the Ford Option Plan and I would be foolish not to take advantage of it.

Unless the Ford Option Plan is competitive with the Model Y, I for one, will not be taking delivery of my First Edition.

As there will only be 15,000 to 20,000 MachE available for sale in the US, my dealer should have no trouble selling my First Edition - or maybe he will - just like Audi, BMW and Jaguar dealers have with their BEV. But that will be the dealer's problem not mine and in any event I wish him well!

.

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ReturnOfTheMack

· #14 · Aug 12, 2020

It's good that Ford knows people are going to ask about the Model 3 and Y. Hopefully they give them a bit more info than this though.

I already feel bad for any Ford salesperson that has to deal with Tesla fans showing up to their dealer

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desertdrifter

Discussion Starter · #15 · Aug 12, 2020

ReturnOfTheMack said:
It's good that Ford knows people are going to ask about the Model 3 and Y. Hopefully they give them a bit more info than this though.

I already feel bad for any Ford salesperson that has to deal with Tesla fans showing up to their dealer

The difficulty in closing these EV sales could present an opportunity for some dealer sales people, who really learn the product, to make a name for themselves as the Mach-E go-to. This will be more important in a year from now when hopefully dealers have plenty of Mach-E in stock to sell.

zhackwyatt

· #16 · Aug 12, 2020

eastern refugee said:
My 2 cents. Most people buying the MME have owned fords previously.

I thought this was confirmed at a Ford level but I can't find it.

Any case, one dealer stated that 2/3rds of customers are new to the brand.

peugfan

· #17 · Aug 12, 2020

JTK44 said:
I have been leasing for over 35 years, not because I cannot afford to buy, but because I lease luxury cars which depreciate in three years much more than the residual and once out of warranty the maintenance costs can truly be scary..

So if the leasing is a good deal for you it is a bad deal for the company that leases. Would not a leasing company want to make money on a lease? Or if the leasing company is the manufacturer they must be using it as a loss leader to attract buyers that could/would not buy it otherwise. That might say their cars are too expensive.

Ford must not want to lose any money on an MME lease AND has decided that they will be able to sell all the Mach-E's they can make anyway. They could decide to sweeten the lease deal at any time depending on how brisk the sales are.

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JTK44

· #18 · Aug 12, 2020 (Edited)

peugfan said:
So if the leasing is a good deal for you it is a bad deal for the company that leases. Would not a leasing company want to make money on a lease? Or if the leasing company is the manufacturer they must be using it as a loss leader to attract buyers that could/would not buy it otherwise. That might say their cars are too expensive.

Ford must not want to lose any money on an MME lease AND has decided that they will be able to sell all the Mach-E's they can make anyway. They could decide to sweeten the lease deal at any time depending on how brisk the sales are.

This is not the thread to try to explain the pros and cons of leasing and the tax advantages of leasing which are substantial. That is for another topic on another day.

Suffice it to say, that if Ford could sell every MachE at full MSRP, for cash, no financing, they would. This is what Ford in fact does with the GT 40 and Ferrari with their new models: you put down a deposit and in 6 months to a year, your car comes in, you are notified and you give a certified check in exchange for the car. No financing. No lease. You pay for the car, period.

The MachE is neither a Ford GT 40 nor a new model Ferrari: in order to sell the MachE, besides paying full price upfront, Ford presently provides two types of financing:

Straight financing for 36, 48, 60 and 72 months
Ford Option Plan

What is missing is competitively priced lease program.

You may be correct that there is sufficient demand for the MachE, that Ford does not have to offer a lease program.

We must wait for the First Edition to arrive to see actually how many reservations were converted to orders and how many orders will actually be converted to sales. If sales are brisk with the First Edition and the Premium, then a competitive lease program will not be necessary.

If on the other hand, people are reluctant to either pay full price up front or finance their car, then Ford will have to offer a competitive lease program.

Keep in mind that Tesla for the Model Y, despite a 6 to 8 week wait:

Within 3 months of its introduction, reduced the price of the Model Y by $3,000
Originally said leasing would not be available, but within 4 months of its introduction offered a competitive lease on the Model Y

This thread is all about how the MachE compares to the Model Y and how the dealers are being instructed to handle questions about the Model Y and the MachE.

I believe leasing will come up and to date Ford does not have a competitive lease.

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machstang

· #19 · Aug 12, 2020

desertdrifter said:
The difficulty in closing these EV sales could present an opportunity for some dealer sales people, who really learn the product, to make a name for themselves as the Mach-E go-to. This will be more important in a year from now when hopefully dealers have plenty of Mach-E in stock to sell.

I think seat time will be critical to closing sales. Dealers that have demos should see higher conversions. However, weakening demand for Tesla's (as indicated by the recent price cuts) might mean that access to demo's might not be that necessary after all.

driving.ca

Tesla cuts prices for almost all models, signalling weakening demand

The S, X and 3 saw their MSRP drop by between $1,000 and $4,000 in Canada, depending on car and trim

driving.ca

www.theverge.com

Tesla’s Model Y gets a $3,000 price cut

The Model Y just began shipping in March

www.theverge.com

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guyofthesky

· #20 · Aug 13, 2020

eastern refugee said:
My 2 cents. Most people buying the MME have owned fords previously. Everyone knows that the Y and 3 series are entry level. They are NOT the real Tesla. They are the equivalent of a Boxter to a Porsche buyer. I own a Porsche but not a real one.
MME has what Tesla dies not. It is not an entry level car but rather in a league of itself.

people buying the GT are those used to high performance mustangs and those are absolutely in the $50,000 plus range to a reasonable $75,000 range. They are buying the MME because it is both a high performance mustang and is flat out different.
I think that comparing the MME to the Tesla is way over rated. I wanted a BEV for years and yes I looked at Tesla but my issue is the only Tesla’s worth looking at in terms of getting what I feel is both comfort for a long drive and worth the money was either the S or X but at $80,000 plus I just could not justify it. The 3 and the y look cheap compared to the other 2.

the MME fascinated me from day 1. It was a ford and after sitting in it at the LA car show I was hooked. It is crazy comfortable and has the stuff I like. I would live a lease because I KNOW a Shelby version will likely be out in 3 years.

Did you get to sit in the MME at LA? If so, I'm jealous.

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