A few days ago, someone asked me what the problem with sales is.
The way I see it, short of a recession, three things drive vehicle purchases: product design, product quality and product price.
As a Ford dealer, I can say that Ford has done a pretty good job of designing viable products, and the quality is on par with any import. However, the sticker prices of our vehicles are often so high that I wonder how anybody affords them.
We have created an inconsistency that is guaranteed to confuse and frustrate our customers. The factory bean counters sit on the rebates just in case a few unsuspecting customers will buy without them.
Then, when the inventories start to build, they slowly start adding customer rebates to see whether sales will pick up.
When sales still don't move, they add more rebates or extras. Eventually, they break down and set the rebate at the level that makes the vehicle price attractive and competitive with other makes, and - Voila! - sales increase, and the cycle starts all over again.
No wonder we have screwed up the consumer's mind!
Stop headhunting for a few unsuspecting customers; price the vehicles at prices that sell and, in time, consumers will realize that they can buy when they are ready rather than waiting for the rebates to increase.
The mainstream products will retain credibility and value if we become consistent with the pricing and presentation of their value.
One final thought. If the factory pricing remains consistent and dealers don't have to guess at the rebate levels, the factory might find we are more willing to order product based on upcoming sales events vs. ordering because of rebate and incentive availability. The factories have us as confused as our customers.