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ADM and destroyed dealer relationships?
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<blockquote data-quote="melvimbe" data-source="post: 1759581" data-attributes="member: 35314"><p>Allocations aren't capitalism. Agreed there, and that is part of the problem sort of artificially can create scarcity of supply. However, 'first come first serve' is not a tenant of capitalism. If it were, then auctions wouldn't be capitalism. You'd be selling the house to the first person that makes an offer. No, capitalism essentially means that the price is set when both buyer and seller agree to the price with a binding agreement. There certainly can be done with a first come first serve model, but not a requirement.</p><p></p><p></p><p></p><p>Allocation is more of utility of maximizing availability to the consumer when buyers are more restricted to local markets. It doesn't do anyone any good to send 200 Raptors to BFE because BFE dealer ask for the first. However, now that the market is more open and consumers are more willing to order a vehicle, rather than buy off the lot, the model gets in the way more than it helps.</p><p></p><p></p><p></p><p>Don't think the ability to buy direct is a requirement to capitalism either. Perfectly legit to sell to distributers and out source all the customer service and costs with that, if you don't want that to be a part of your business.</p><p></p><p></p><p></p><p>So if a dealer is offering you $10k over MSRP right now, you'll reject. In 2023, if the same dealer will offer you MSRP ...that happens to be $10k more than 2022...you'll accept? Ignoring inflation, interest rates, or the cost of competing products? Would you buy at $5k over MSRP if resale value was trending to be very high over the next 5 years? That's the point. While I get why MSRP matters, it's really just a reference point and plenty of other factors are what really matter. </p><p></p><p>I bet a lot of people who are balking at ADM would pay it if there was no MSRP reference point. Then again, if there was no MSRP, there would be some other reference, like a market value index, that consumers would look at for a starting value for negotiations. Again, pretty much what happens with used vehicles.</p></blockquote><p></p>
[QUOTE="melvimbe, post: 1759581, member: 35314"] Allocations aren't capitalism. Agreed there, and that is part of the problem sort of artificially can create scarcity of supply. However, 'first come first serve' is not a tenant of capitalism. If it were, then auctions wouldn't be capitalism. You'd be selling the house to the first person that makes an offer. No, capitalism essentially means that the price is set when both buyer and seller agree to the price with a binding agreement. There certainly can be done with a first come first serve model, but not a requirement. Allocation is more of utility of maximizing availability to the consumer when buyers are more restricted to local markets. It doesn't do anyone any good to send 200 Raptors to BFE because BFE dealer ask for the first. However, now that the market is more open and consumers are more willing to order a vehicle, rather than buy off the lot, the model gets in the way more than it helps. Don't think the ability to buy direct is a requirement to capitalism either. Perfectly legit to sell to distributers and out source all the customer service and costs with that, if you don't want that to be a part of your business. So if a dealer is offering you $10k over MSRP right now, you'll reject. In 2023, if the same dealer will offer you MSRP ...that happens to be $10k more than 2022...you'll accept? Ignoring inflation, interest rates, or the cost of competing products? Would you buy at $5k over MSRP if resale value was trending to be very high over the next 5 years? That's the point. While I get why MSRP matters, it's really just a reference point and plenty of other factors are what really matter. I bet a lot of people who are balking at ADM would pay it if there was no MSRP reference point. Then again, if there was no MSRP, there would be some other reference, like a market value index, that consumers would look at for a starting value for negotiations. Again, pretty much what happens with used vehicles. [/QUOTE]
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