Ferrari Dealer Margins

1. Ferrari dealers don't buy used cars.

2. What difference does it make? If you want to run with the big dogs, you gotta be ready to lift your leg high.

 

The margin that any business operates on should be a concern.

Focus on getting a price that you deem is fair...

In the case of a consignment car tell them the "net" you require and be sure that EVERY offer received is also is presented to you.

 

FoLI has a big social campaign about buying exotics...

 

I think i read in another thread regarding turning the clock back in USA ..the sales guy was paid +/- 10% of the value of his sales .. so then the dealer got to make something on top of that of course.

I don't recall if this on new and/or used deals.

 

"In 2015, the lawsuit reads, Root sold $2 million worth of cars and earned about $200,000 in commissions."

 

Dealer List at 20%+, consignment is 5-10% depending on what you can negotiate. Sales rep gets paid on profit.

 

And of course they buy used cars but will whore you especially now it seems as cars are sitting.

 

They're sitting bc Ferraris attempt to become a public company and boost profits has killed the mystique. The cars are amazing but

1) people are tired of the games. Guys are tired of having to lose $50-100k on multiple cars just to get one at sticker years later.
2) they are making way too many of them look at how production figures have soared, 18 years ago you couldn't just walk in and find 10 360's sitting at a dealer basically new, you can now with 488's

In the old days it was hard work to get a Ferrari. They made just a few a year, it was very tough to get one, they've opened it up but they basically did too much too fast. Back in the early 2000's 360's were selling over sticker for a long long time, right now literally like new 488's and california's are available for $30-50k off sticker at the big dealers here next to me in south florida. Most guys don't even want these 488's or Cali's but they're forced to buy them as part of the game to get other cars. Honestly I think Ferrari has kinda shot itself in the foot for the long run bc most owners also once they get a hang of how things work, they don't service their cars at the dealer either. I have an incredible shop that works on the highest of high end ferraris and basically walked me through all my cars previous receipts from a Ferrari dealer and showed me how Ferrari dealer adds in a bunch of nonsense just to make more money from guys who really have no idea whats going on and have more money than brains. Most guys who really know whats going on go to great indy shops so in the long run Ferrari dealers basically burned bridges with too many people over servicing + list nonsense so now that cars are easily available nobody is going to play their game. If you look most Ferrari dealers charge way more for their cars than you could find on the open market which is the norm for all car dealers but now Ferraris are easily found everywhere and you don't have to get them from the ferrari dealer.

I personally think Ferrari dealers suck. The collection next to me in Miami has the worst service + sales I've ever seen. Everytime I used to call in I'd get transferred and I kid you not nobody would ever answer in sales. Never. I have yet to meet one other Ferrari owner in Miami like me who has anything good to say about the collection and their sales or service so as far as im concerned their margins are way too much.

 

Their margins are gross, here is an example I was offered $82k for my pristine 575 recently, look around and tell me what 575 asking prices are for a nice red/tan one with shields and a fresh major service done like 2 months before I called them. 50% margins? Car is easily worth $120-130k. The answer I got is the 575 is a hard sell and not many people looking for a 16 year old car, a Ferrari dealer actually told me that in regards to one of their own cars. Believe me I wouldn't even have called them but they had a stradale I wanted and you can't find one of those just anywhere and they had it. Same car as my 575 just sold on BAT for $116k + 5% fee just 2-3 weeks ago.

 

Exactly the 575 is such a hard sell that someone listed a red/tan one just like mine on bring a trailer and within 7 days they sold it for $116,000 and BaT got $5,000 ontop so $121,000 total. Im sure many customers have more money than brains and are fine with the offers Ferrari dealers give them but with how easy information is to access today, it seems silly to get your ass handed to you like that on a car that really isn't that common. Ferrari dealers offer you awful deals but they have owners scared that if you don't do business with them you won't get the next car. That's what keeps the dealers open basically is the "fear factor" they instill into customers, isn't that awesome?

 

Ferrari dealers very rarely buy a car from you. The market is very volatile for the exotic used car space.

I traded in a 458 coupe bought in June 2014 with an MSRP of $291K. I received $240K in January 2015. I saw them list it for $255K and it disappeared from their website within two weeks (presumably sold).

Most of the time it is on consignment. Percentage will change based on desirability of car (higher price (lower percentage) and your transaction experience and whether you are selling your car to go into another car. The lower percentage you negotiate then the less motivation they have of selling your car and will end up being wholesaled).

Some times there is nefarious things that go on with the consignment thing. You negotiate the percentage and list the car at whatever price you want. Some time goes on and dealer eventually asks you how much you actually want to get from the car sale. You tell them the price and if it gets sold then you get what you said you wanted for the car. They may actually have sold it for a higher amount but you wouldn't know it.

 

Taking cars on consignment is different from buying the damn thing.

 

True. I believe they do consignment and take cars on trade. Not sure they pay cash for cars, unless I smoking deal

 

And ... Why use the dealerships money when the consignment car is without capital cost?

 

Am I reading this correctly, $51k bath for 6 months ownership ?

 

Yep, when they were newer it wasn't the case but now the excitement has worn off and the take pretty big deprishiation like any other car just more so because of the initial cost.

It appears Ferrari has 3 kinds of cars they sell, new that you order when your spot comes up, cars that you trade in on new or used purchase and cars on consignment. It's like others have said it appears that Ferrari doesn't want to get hung up with a bunch of inventory.

I've also been told and read and been told in most cases dealers try to sell at15-20% over and in a lot of cases that seems to be true. But I have also been told that Ferrari dealers don't rent to negotiate off the ask price much either. Honestly I don't know about Ferrari and negotiations but I would say that in most cases you probably get a better sorted car buying from Ferrari, and it may be eligible for CPO status which could be good as well depending on several factors.

Good luck!

 

yes, you are reading it correctly.

 

Around here you have to keep in mind that the dealer prices your sales tax benefit into the trade price when you trade the car in. So a car that might sell privately for one price will get a far lower offer from the dealer on a trade, knowing that you will still get another 8 1/2% sales tax credit. When I figure out the value of my trade plus the sales tax credit it's always about 10% less then I could get selling it privately. That seems to be their markup. I have asked about consignment and was told 6%.

 

I've always found it funny how many customers thought the dealers had no right to make money. Capitalism for them, but not the dealer. With Ferrari keeping production low and allocation competitive, then everything comes down to fixed and pre-owned. Pre-owned is riskier than you'd think, so dealer might go in hoping for a 10% margin, but after 60/90 days, have to start paying interest on that inventory plus don't forget all the risk of a car needing unexpected service (car seems fine, but poof, needs an extra $10k in work once you get it on the lift).

Long story short, unless it's a high-demand car or classic, unlikely they're making a killing in the scope of things. Some dealers enjoy Ferrari as a toy/status symbol, while looking to their other dealers to be their money makers. Costs a lot to run the caliber of events that FNA expects, then renovate the showrooms as the factory expects, and pay for the real estate (typically in nicer areas).