Few will tolerate the noise and harsh ride of a “proper” sports car. And that’s okay. GTs are, well, very damned nice. Since 99.9% don’t open track or autocross and those that do spend 99% of their time driving on public roads the Grand Touring car is just about perfect. Except for the headbangers such as myself and the few other likeminded people I communicate with on obscure websites and EVO magazine subscribers.

One would have thought that the Marketing types would know this… they did and they do. Well, some of the persons involved did and do. I was not marketing – I was P/T NVH R&D but I’m an unapologetic, gamebred sports car & sports bike enthusiast. You know, the kinda guy that’s NEEDED in the Auto Industry. Not to build my personal IMSA GTP car with ‘plates but to UNDERSTAND interpret the AUTO OWNER’s requirements and engineer/develop them. The engineers I worked with DID NOT KNOW. The Marketing Dept was as much full of attractive flakes as anything else – except persons who lived to be around, engineer & develop better vehicles. And upper management? I wouldn’t follow them to the restroom.

Great article, btw.

Us enthusiasts are an exceedingly tiny minority and I understand why we’re neglected for high volume sales. I just don’t like it.

Ferrari is unique. Exceedingly so. However, they should know that cars such as the F430 is “relatively new” to them and that Ferrari made it’s mark with GT cars unlike Porsche who did so with it’s lightweight track stars. Perhaps Ferrari is heading in the proper direction: several front-engined, high performance GTs and the “entry” mid-engined sports car with a track special version of same added every now and then. Like Porsche is doing now.

Honda: Oh how the “mighty” have neglected me… I adore my Acura ITR; would love to have something else in a similar vein from Honda. C’mon, Honda… I think I’ll go test drive a Civic Si today…

A standard umbrella with the Ferrari logo was $250, when I visited in 2006. They also charged $10 just to browse the showroom floor.

davey49 : I’m sure Ferrari doesn’t make a lot of money selling cars. They make all their money licensing T-shirts, toy cars and logo junk. Are the T-shirt sales down?

This is a critical point that the article and comments largely missed. Ferrari is a highly unusual automaker. They are more of a luxury lifestyle retailer: more like Gucci or Hermes, less like Ford. Most of their profits come from branded non-automotive goods, both upscale (computers, watches, pens) and down scale (t-shirts and caps).

Hah! Sounds like Harley Davidson. A T-shirt seller with a motorcycle division.

Now they have screwed up my TSX thanks to Marketing Research – ARGH!!

That also adds uneeded costs as the extra weight requires upgrades in areas such as engines, brakes, suspensions, etc.

I believe that these “needs” artificially drive up the price of new cars while they needlessly add to the development costs of the new models.

This is a critical point that the article and comments largely missed. Ferrari is a highly unusual automaker. They are more of a luxury lifestyle retailer: more like Gucci or Hermes, less like Ford. Most of their profits come from branded non-automotive goods, both upscale (computers, watches, pens) and down scale (t-shirts and caps).

While this is true to an extent, another reason why sport niche cars are disappearing is that the average car has become far more capable. >200hp engines are the norm, as are large low-prof tires, and all of a sudden the family car is adequate for the average hoon out for a romp. Good enough becomes the enemy of perfect.

Great article. I have been reading the site for some time, but didn’t register until today.

The above really resonates with me as I grew up driving Hondas, starting with a ‘91 Integra and moving to a ‘93 Prelude SRV (that’s VTEC to you folks south of the border). The one point I would make is that the Prelude wasn’t killed by the Accord coupe alone, but microniched by Accords & Integras together.

My Prelude was my companion for many years and many kilometers. It was a true Goldilocks car in that the die hard corner-carvers described bought manic Integras while the sedan folks in denial bought Accord coupes, but the Prelude armed with the H22A VTEC engine occupied a sweet spot somewhere in the middle, composed but capable.

When I eventually went to replace my car I bought an ‘06 RSX Type S. Someone else on this site once compared driving the RSX to dating someone in their early twenties, and I agree. It is loads of fun but manic – this car wants to party all the time. The alternative was sitting on the porch watching the world go by in the more “mature” Accord coupe described. The dark horse in the equation was the first gen TSX that was a wonderful compromise that really deserved another 30-40 hp.

Faced with these options I chose the porridge that can be too hot on days when I really just want to settle in for the commute over porridge that was too cold, and porridge that was just too slow.

I can accept that at the end of the day, it probably didn’t make sense for Honda to cluster this segment with 3 offerings, but I for one enjoyed being in the mythical middle that enjoyed, and bought the Prelude.

The odd part of the story is that this is a stand alone Ferrari dealership. And only the second stand alone Ferrari dealership in the U.S. If you go there they can’t down sell you into a Jag or Volkswagen. They sold 8 cars in the first week of operation. The owner stated they expect to do well in Tampa due to old money being available?

Want a 5 series because the kids have grown legs ? Mechanically identical to the 3 series, but a foot or so longer and wider….$15,000 more with same engine and equipment than the equal 3.

Honda Pilot or MDX ? That tighter suspension is going to cost you-thicker sway bars are very, very expensive to engineer.

You can go cheap, but that minivan is declasse’, and they make sure there is no sports package, as if stiffening the suspension just a notch is forbidden. Minivan owners also don’t have backs that might like sports seats. (We are not going to the Nurembring, just want to be firm on the highway and in the ramps).

I buy the cars and keep them ten years, so I might not be the ideal subject here. I fully expect my bought new 2003 BMW to last 300k to justify the price. I’m probably not the X6 buyer.

It’s all a scam. Offer the car cheaply, make sure that if you can find the stripper that the car is so lacking, and then pile on options. Want a heated seat ? That $5 heating coil is packaged only with leather and satnav for $2500. Want a better radio in your VW (and too stupid to go aftermarket)…it comes with a sunroof for $1200. Want a lumbar adjustment in your sports seat ? OK, but only with the premium package for $2500-not included with the already extra money sport package or seats.

Everyone does this. Take the one option many will pay for and package it with a bunch you don’t care about, just like Cable TV packages. Make them pay for the bunch.

Since few people in the US will “special order” a car, we all get stuck with a lot of crap we didn’t really want and a higher price.

The marketers, of course, know that. I had to special order a car because I didn’t want a sun roof, and overcome the objections of the dealer who wanted to sell me “on the lot”.

Look at the interior of any US pickup built in the last few years. Compare it with the interior of, say, a 72 Chevy or Ford pickup. You’ll see a lot of the difference right there. When you’re selling vehicles such as Tahoes and Suburbans in the luxury price classes, the knobs and switches and such tend to be pretty nice, and these are then also found in the Chevy work trucks. Then there are the other niceties like drive-by-wire throttles and such. They help squeeze another half-mile per gallon of gas, and probably add measurably to engine life, but I doubt that they’re as cheap to make as the old mechanical throttle linkages.

Great article.

The problem is, that still puts us in the tiny minority of new car purchases. We get what we want much of the time because the people who work for the auto industry think like us. They make the mistakes you described. By assuming that the average car buyer has even done a minute of research, they drive themselves to produce better cars. By the mistaken assumption that even a statistically significant minority of drivers know the first thing about performance driving, they occasionally build excellent performance cars.

Not quite. The domestics made the same mistake that they have been making for years, by building vehicles that were not good enough to justify the prices that they were asking.

If the goal is to keep losing money and to destroy their brands, then yes, they should follow your advice and cut their prices.

If they wish to be profitable, they will make cars that are good enough to justify a given price point, and then match production to conform to a reasonable sales target based upon that price. If the vehicle can’t be made for a profit within those parameters, then it shouldn’t be built at all.

Yours is a recipe for brand destruction. If a car was like a bushel of corn, you’d have a point. The purpose of branding is to ensure that a car maker doesn’t end up on the same playing field as the farmer with his corn.

Someone else can trace the road whereby pickups (and by extension SUVs) became much more pricey than cars. Sure, a few hundred dollars of extra sheet metal and such, but $12,000 more?

Nevertheless, SUVs and pickups became the cash cow with huge margins. Was it only a couple years ago that an incredibly out of touch Chevy announced the new Silverado as its savior?

The big discounts we are seeing today in trucks & SUVs only reflect the huge margin the carmakers enjoyed. A welcome reduction to reality, but SUVs and pickups are STILL priced too high.

So bigger discounts were announced, indeed reducing some of the inventory in recent months. So the car companies actually recognize that their products are priced too high, and that price reduction works. So then they rolled back some of those discounts.

I also agree that fixed costs won’t allow a prolonged production reduction- I was responding to another suggestion that put forth that proposition.

In the old days the car companies have had the luxury of setting the price. Consumers across the table blinked and ante-ed up. Today there are no consumers across the table, and we now see the result of setting prices too high. No sales.

Smart car companies will see the market and adjust. If they can’t adjust, they go out of business. This is what happens in business. The car companies saw it coming, but they still priced their cars too high, and made a bet that DC would bail them out. Their bet was correct.

Now that taxpayers have allowed them to stay in business without selling cars, the gov has changed the market. The gov has preserved car prices that are too high to afford by bailout out the companies. The companies don’t care, since they don’t need to sell cars anymore to fund operations. All they have to do is whine. The first time was the hardest part. Now it becomes easy. Infinite bailouts with car prices artificically high to the point that no one buys them, immense overcapacity, but the car companies no longer care. Their product is not cars, it is whining.

I can see where you heading, but in general branded good manufacturers are termed “price setters” rather than “price takers”.

Obviously, you can negotiate somewhat, every now and then.

Ferrari might have their manufacturing capacity running at 70% idle, but you won’t see them halve their prices to use up that capacity.

GM/Chrysler have behaved as price takers far too often via many varied means.

The smart car companies will reduce fixed costs as much as possible and wait it out. GM/Chrysler can’t cut fixed costs much because they are astronomical, plus they have MASSIVE interest bills to pay.

$40,000 Silverados discounted by $30,000 via Red Tag (or whatever) was to generate cash flow to feed the fix costs for Dec/Jan. They might even have been making a loss at those numbers.

No, there is absolutely nothing in the market that guarantees anyone a profit. In fact, the seller doesn’t get to name the price of a product, especially if it is overproduced and non-unique. The market doesn’t care about profit, about what the rate of inflation is relative to previous prices- none of it. The market is brutally honest. In the face of such oversupply the market is determined by the buyers. A buyer is not someone who would LIKE to buy, if only… A buyer is someone who DOES buy.

The current inventory is matched to yesterday’s demand, so there is currently a glut. The successful companies will temporarily cut production, while simultaneously attacking their rivals to gain conquest customers.

The best (only?) way they have right now of attacking their rivals is to lower their effective price to the point the market is buying again.

Cars are not a commodity good. They are branded goods that have tiered pricing, and which can be modified to alter the level of margin that they can produce.

Sure, there is a year’s supply of cars on the lots. GM can simply stop making cars for a year. Then maybe supply will meet demand and the price will reach equilibrium with the market. But I don’t think GM will go with your proposed solution of stopping production for a year, since all its fixed costs are still in play- including pay to the now non-workers.

GM has followed your dumping formula. It obviously doesn’t work.

No, GM has not done this at all. They have placed red tags that give the same ‘discounts’ anyone could have negotiated. They have modest rebates on their cars, absolute numbers of which haven’t changed in decades even while the MSRP of cars have soared. GM has raised the prices of cars with (and within) every model year, although wages are flat. Three years ago GM was offering double-balance credit to its credit card holders; nothing since. We have only seen fake, not real, discounts. GM thinks there is a pricepoint below which it need not go to sell cars. The market thinketh differently.

The key point is that in even offering these pretend discounts, GM has recognized that price is a factor in the market, and so has pretended to lower its effective price. Just like twenty years ago when GM was touting that it had learned its lessons and was now offering superior quality. Because it is much easier to claim better quality and to claim lower prices than to actually deliver them.

It doesn’t matter what you or I wish. The market speaketh.

Buying a car new and driving it for a long time comes close to buying used in terms of price. It is less risky, you get what you want for options – and perhaps more important, you don’t get what you don’t want. There is a hidden risk cost to buying used. Some brands like BMW don’t recommend proper fluid change intervals, so few used BMW’s are properly maintained.

Buying a used car makes sense for models that depreciate quickly. However better brands do not depreciate quickly, therefore you don’t save that much money when you consider new tires, new fluids, new brakes etc.

My new cars also track straight. The also track straight after ten years because I have a policy of not hitting curbs. A used car that has been bumped around a bit will never drive the same. Sure you can get an alignment, but does the technician bother to put the top of the steering wheel at 12 o’clock? Etc.

You get what you pay for. As the saying goes, there is no free lunch. But go ahead keep buying used, because you support the price of my car in ten years time by making all used cars dearer.

I am also reminded of a graph I once saw in a trade journal. In inflation-adjusted dollars, the “price” of a new car translated into payments of $200/month…and that figure remained almost constant for nearly 50 years.

However, what has changed since the 1950s is the time of those payments. Car loans in the Eisenhower years were 2 years or 3 years. By the late-1990s, typical car loans were 5 years (or even more).

Finally, many people abandoned purchasing altogether, and made lease payments of $200/month (inflation-adjusted).

Of course, with stagnant real wages since the 1970s and with our country having maxed out its borrowing ability, this trend is going to have to change.

Manufacturers that understand cars need to be treated like a valuable “asset” and exit price maintained as best as possible, are the ones, in general, that are in better shape.

Maintaining the exit price is done mostly by maintaining the entry price.

(They also creep models from one class to another, vis 2008 Yaris is bigger than the 1994 Corolla, 2008 BMW 3-series is bigger than the 1990s 5-series, while the 1-series is “slipped in” underneath the 3-series).

I loved your little dose of reality on the state of the American consumer, “What is amiss is that Americans don’t earn enough to pay for all the bells and whistles that they want in their lives without going into hock to pay for them. You need to either earn MORE or else LOWER your expectations, you can’t have both”.

It will be posted on the frig for my son who has graduated from college and hasn’t found a job yet…….isn’t looking too hard either.