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Chris Richardson (Boozy)
Junior Member
Username: Boozy

Post Number: 113
Registered: 11-2001
Posted on Sunday, March 31, 2002 - 6:51 pm:   

The problem is finding someone to lease you at 6-7%. I couldn't get anyone to lease me at under 15% when I bought my 348 Spider. Maybe I just don't know where to look.
Steven J. Solomon (Solly)
Member
Username: Solly

Post Number: 260
Registered: 6-2001
Posted on Sunday, March 31, 2002 - 4:27 pm:   

Yes, the numbers are real. Also, much easier to do as a corporation than to deduct on your personal return. Easy to establish a corp. but pretty useless for these purposes unless it has some real business income, i.e. you cannot have a corporation with a Ferrari as its only asset, no income, and expect to deduct the lease payments.

Frederick Klorczyk (Fjk)
New member
Username: Fjk

Post Number: 44
Registered: 12-2001
Posted on Sunday, March 31, 2002 - 1:14 pm:   

You are very correct in your analysis Solly. Even without the creative accountant, with money at 6% or 6.5% and the deferred state sales tax payment on the whole nut, it can make sense to do the lease to buy deal instead of just buying. And if the value holds...you can smell like roses. Just hate those damn payments and hearing how "we could buy a second home". Yeah, right.
wm hart (Whart)
Junior Member
Username: Whart

Post Number: 170
Registered: 12-2001
Posted on Saturday, March 30, 2002 - 9:10 pm:   

Are those real numbers? even if you couldn't deduct the lease payments, the premium doesn't seem too high,compared with the impact of having to write out that big check (at least for some of us), or am i missing something?
Mr. Doody (Doody)
Junior Member
Username: Doody

Post Number: 120
Registered: 11-2001
Posted on Saturday, March 30, 2002 - 7:14 pm:   

solly - i thought the IRS put some hard limits in place for lease expenses?

doody.
Steven J. Solomon (Solly)
Member
Username: Solly

Post Number: 259
Registered: 6-2001
Posted on Saturday, March 30, 2002 - 6:21 pm:   

Just a "theoretical" note on 360 Spider ownership.

Strike price: 250,000
Lease: 3 years, at 6%
Residual: 140,000 (you must buy car at this figure. You cannot walk away if the value is lower)
Amount financed ("leased"): 110,000, plus cost of money @ 6% (let's call it another 20k) Total lease cost over 3 years=130k.
Value of tax savings in top bracket, assuming approx 7% state/local tax=approx 60k. Net cost=70k

Buyback at end of lease: 140k.
Real cost of "lease" payments: 70k

total cost to own car: 210k. Not very far from MSRP, and you get to drive one today. No right of first refusal to dealer. Obviously only makes sense if you are in these tax brackets and have a creative accountant.
Tyler (Bahiaau)
Junior Member
Username: Bahiaau

Post Number: 190
Registered: 12-2001
Posted on Friday, March 29, 2002 - 5:49 pm:   

I agree that FNA is the only one to require dealers to sell new at MSRP. I don't mind that spider prices are high. It just means I'll have to wait till they come down. I guess I just don't see what the fuss is all about. I can remember people paying $100K+ to have the first ZR-1 in town. A least FNA doesn't openly allow the dealers to rape us. Do the dealers find ways around it? Sure, that's how they make a living, I'm not going to begrudge them that. Do I wish the prices were lower? Of course, but come on. I'll just have to save a little more and wait a little longer. That's the nature of the game. There will always be people who can afford to pay the premium to own one "now". I say, "good for them". I'll be among their ranks some day.
wm hart (Whart)
Junior Member
Username: Whart

Post Number: 163
Registered: 12-2001
Posted on Friday, March 29, 2002 - 5:40 pm:   

Guys, i don't have any deep insight here, or inside information, but a couple of real world observations:
Enzo, when he was alive, was one of the few people known to shun, ignore and generally piss off royalty, celebrities and the like who waited for their cars (at a time when ferraris were really rare, eg, in the 50's, early 60's, before the 250 and its 330 successor became production cars).
The American side of the market has always been a lucrative thing, but in the old days, it was handled by a few people (Chinetti, Von Neumann) and was haphazard, not because these guys weren't good businessmen(i think, like many of you, they were enthusiasits first and in it for the money secondarily), but because they probably didn't make any of the ultimate decisions, which were left to the Italians. I don't think its much different today.
The dealers have very little power, and "working with" the factory is sort of a joke. A well intentioned dealer can only do so much; my sense is, today, if you are a celebrity, you can probably get what you want, only because of the recognition in Italy, not because the dealer will have alot to say.
I have bought 6 cars from ferrari (some pretty good ones, a few brand new, no clunkers) and frankly, they could probably care less. My dealer has been pretty good to me, but they don't get product, and do depend on used cars sales and service to make their money. (let's not even talk about Maserati). Sure, the factory could probably sell twice as many cars as they produce; my sense is, they probably crank out about as many cars as they are capable of, and the scarcity, pricing, and bullshit just add to the "mystique." If you had to put up with that kind of thing for a more prosaic car, the market for that car would die (FIAT, anyone?) And like others have said, there probably isn't a huge profit in their businesss (i think they make more money from merchandise licensing than from car sales). But how many Saturn web site chat groups are there?
Frederick Klorczyk (Fjk)
New member
Username: Fjk

Post Number: 43
Registered: 12-2001
Posted on Friday, March 29, 2002 - 4:33 pm:   

Maybe we should all just face it and realize that providing street cars is just a F1 marketing plan for FIAT and that Ferrari's real business is F1. Who knows how much income and profit is turned from the F1 team from the FIA, the sponsors and all those tee shirts, models, etc. I tend to think the revenue and margin they make on the street cars pales by comparision and they hardly pay attention to it.

The old story applies as well in that if you won't pay my price, someone else will. The FNA stores really don't stay in business from the margin on new cars as they are so limited in number and they do have regions they can sell in so they although I would imagine that would be waived for a 456! I have contacted several re "the list" both on on spiders and coupes but the stuck to their guns and suggested I see my local dealer. Used was another story of course. Selling used and providing service and repairs keeps them afloat I believe. Also handling other franchises at the parent company level probably helps. This is often invisible but sometimes not.

FNA requires all new cars be sold at MSRP - those who charged over back in the 80's aren't around anymore. I do admire them for that as they are probably the only company to do so. Remember the overcharges on the first Honda Accord, the Miata, etc. My father-in-law bribed his way to get ahead on the Honda Accord sedan list for crying out loud!
Mr. Doody (Doody)
Junior Member
Username: Doody

Post Number: 118
Registered: 11-2001
Posted on Friday, March 29, 2002 - 3:48 pm:   

Of course, the other side of the coin is that FNA actually WANTS the insane arbitrage situation.

Could that be true? What do they have to gain except pissing off their REAL customers like us?

Doody.
Mr. Doody (Doody)
Junior Member
Username: Doody

Post Number: 117
Registered: 11-2001
Posted on Friday, March 29, 2002 - 3:44 pm:   

While Martin's (very amusing!) explanation might be hyperbolizing a bit, I think Tino's position is a bit too far on the other end.

The crux of the problem is that these are limited production items. PAG decided they'd double 996TT output after the first few months. No big deal for them. DC decided they'd double SL55 production before it even shipped. No biggie. Not the case with FSpA.

Let's use the 355 Spider as the example. Approximately 3,500 were made during the five years the model was in production. North America accounts for roughly 25% of production. So that's 875 cars, or 175 355 Spiders per year coming into North America MYs 1995-1999.

There are 32 NA dealers. That averages to 5.5 Spiders per year per NA dealer. One every other month for five years. (Obviously, allocations vary among dealers, but for sake of argument let's assume gross averages).

If there are in fact the equivalents of dead cats and uncles and infant children on the list, that screws the legit buyers big time. A tiny dealer might have seen two 355 Spiders cars per year - that's 10 per the lifetime of the model! If there were five dead animals in line, that's HALF their allocation.

FNA knows there are oddities going on. They are without a doubt complicit in this behavior. If they didn't think it was going on they never would have done the lease thing they did (the F40? or F50?).

The potential owners get screwed. The dealers make the big margin. FNA gets nothing (they're complicit and get nothing - what bozos!).

And the annoying thing of it is that the dealers intimately understand that the ONLY THING OF REAL VALUE they provide to the consumer is THE LIST. It's juvenile IMO.

These aren't "cars". These are "toys". I assume that the vast majority of new-Ferrari buyers don't test-drive a car before they get on the list and order. I also assume that most people don't necessarily buy tehir Ferrari from the local dealer. They buy it from whoever can get it to them in a reasonable time (because THE LIST is all that matters).

Here's what FNA should do (firesuit donned):

Geography no longer really matters.

The dealerships should be for service and for sales of pre-owned vehicles.

FNA should manage "THE LISTS". They should do a time-weighted lottery for allocations in all of North America.

Every buyer must sign a one year ROFR at MSRP that allows their LOCAL DEALER to repurchase the car.

All this speculation crap goes away. The true enthusiasts can get their cars. The arbitrage opportunity is pushed out to the pre-owned market.

My two pennies.

Doody.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1708
Registered: 5-2001
Posted on Friday, March 29, 2002 - 3:23 pm:   

Not really. The M&M factory (FNA) is trying to put a lid on people importing their own M&M because they do not want to wait for the trip to the market neither do they want to pay 7/11 double the price.

FNA is well aware of what their dealers do. Otherwise they would not be so "concerned" with the imports. Imports make more money in parts. Their order books do not get shorter because of imports. If the prices would not be inflated to $250K for a $170K Spider, people would not even think of a Euro.

If FNA would really want to stop the price hikes, why not impose on their dealers that they can not sell ANY car that is less than 2 years old for above original MSRP. Used or new!
Tino (Bboxer)
Junior Member
Username: Bboxer

Post Number: 60
Registered: 8-2001
Posted on Friday, March 29, 2002 - 2:30 pm:   

Martin, I was stating a fact to argue your statement that it is FNA who "condones the business of charging more". You were wrong. What is happening at the dealer's level is not FNA's. It is capitalism at its best. You pay 65 cents for a 35 cents pack of m&m at 7/11. You do it to have it NOW and not wait for your weekly trip to the market.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1706
Registered: 5-2001
Posted on Friday, March 29, 2002 - 2:08 pm:   

Tino,
this is how it is done:

Mr. X orders a car on the waiting list. Mr. X is the brother/(sister/grandfather/his 2nd dead cat of the dealer.
The car is in the waiting process. You come in the day you have heard of the new 36X Modena and there are already 30 names on the list, including Mr. Fluffy (may his barking soul rest in peace). Your waiting time has just been increased by 2 years.

Mr. Fluffies car is the first to be delivered. He takes delivery, the car is registered in Fluffy's name and immediately put on the dealers showroom because Fluffy decided he can really not drive, since he is dead and a dog.
The car was sold to Fluffy at MSRP, conformant with FNA rules. Now Fluffy's car is up for $ 80,000 more, which the dealer will pocket on top of the profit he made on the original sale.

It is the practice on how it is done that is outragous, not the fact it is. Here I agree, demand and price go hand in hand.

If Joe Schmo has to sign an agreement that he can not sell the car for 2years, how come that F-Dealers offer 50 Delivery Mile cars every day?

Mr. Fluffy is outraged!
Bill Sawyer (Wsawyer)
Junior Member
Username: Wsawyer

Post Number: 56
Registered: 2-2002
Posted on Friday, March 29, 2002 - 1:21 pm:   

I wonder if they really are selling that well. There seem to be a lot of cars on the market. I think the market is artificial and therefore unstable.

Actually, I think exotics should be priced like Lobster. The price would be set weekly based upon demand, season and market conditions. Set a minimum of, say $150k (equivalent to MSRP) and re-evaluate it weekly. The price would be set by the manufacturer, not the dealer. The kicker is that manufacturer and dealer would split the excess profit equally. The problem with today's system is that the manufacturer created the product, but the dealer reaps all the excess profit based on demand for a product they had nothing to do with creating.

State laws that favor dealers would not allow this to happen, of course.
Tino (Bboxer)
Junior Member
Username: Bboxer

Post Number: 59
Registered: 8-2001
Posted on Friday, March 29, 2002 - 11:59 am:   

Martin,
With all due respect, you're wrong. AFAIK, FNA is the only importer in this country who succesfully (but tacitly) imposed an MSRP price policy on their dealers. The gouging is happening on "used" cars already in someone's name. All of us who ordered and waited paid MSRP.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1704
Registered: 5-2001
Posted on Friday, March 29, 2002 - 11:43 am:   

as much as I agree with you, the only people whinning is Ferrari of North America, whinning to DOT/EPA that all the imports are unsafe and have to be taken off the road.

To me there is something like business morals. I see that this is becoming a rare commodity these days. This overpricing and the pressure that FNA is putting on importers is what gets my blood boiling.

Why have a MSRP to begin with if FNA condones the business of charging more for their cars anyway. Then put no MSRP on it and tell the dealers charge whatever you want. At least then they show their true face!
Lou B (Toby91)
New member
Username: Toby91

Post Number: 24
Registered: 4-2001
Posted on Friday, March 29, 2002 - 10:32 am:   

Fredrick is right on. Its all business. Wait or pay market and stop whining. I think the resale string on 360's is probably an individual dealer thing. I know three 360 Spider owners (one northeast, two Florida) including myself who waited, paid MSRP without any resale or other strings. By the way, I put money down in 1999. Supply and demand, capitalism rules.
Frederick Klorczyk (Fjk)
New member
Username: Fjk

Post Number: 42
Registered: 12-2001
Posted on Friday, March 29, 2002 - 10:04 am:   

I was place on the infamous spider list over two years ago. I agree with the dummy customer concept and that is simply business in my eyes. Fair? According to law, I suppose so. Is it any different than the guys who sell their high demand cars to secondary market dealers for a quick flip buck? Either way, the fact is that you either pay the current rice or wait until you can spec your car - six months in advance of the target delivery date - and then hopefully pick it up half a year later. In this dealer's case they also require a contract be signed that gives them the right of first refusal to buy the car at the price I pay should I opt to sell it during the first two years of ownership - similar to the 550 Barchetta with a one year contract. The F50 was solely a two year lease and the cars went back to FNA in order to prevent just what we are seeing with the 360 prices. Much like Solly who just paid over MSRP, I don't intend to flip the car so I don't care.

It has been my experience that the leases are really bastard finance plans and after 24 or 36 months you are liable for the residual nut - they ain't taking the car back. Thus, you can set the residual at any level you want cause that baby is yours. I think that is why half the freaking cars are on consignment at FNA dealers - plus they skim 10% for the handling fee.

Also, Mr. Doody, the money factor in the northeast is currently 6 to 6.5%. Ten or eight is way over market.

I think it all boils down to the supply and demand curve we all learned in micro101 - most of us are on the demand side and this is the way the market is. Porsche originally said they would send 200 996 tt's to the US. Not that it mattered to me then or now but there was a potential I could drive the turbo a while and break even on it. The current market is maybe 105K wholesale and 115K retail for a 2001. Needless to say I dumped a "shitload" more that that in it. Such is life. Porsche dumped every car they could in the US and then there was the dradful 9/11. Nothing that any of us can control.
Mr. Doody (Doody)
Junior Member
Username: Doody

Post Number: 116
Registered: 11-2001
Posted on Friday, March 29, 2002 - 9:25 am:   

Lou B:

I had a shop contact me with a new 360 Spider they wanted to lease to me. It was EXACTLY what I would have wanted: silver/black, 6 speed, etc.

They were working as follows:
24 month lease
$275K car
$175K residual
10% rate
Which came to about six gees a month. Times 24 months is $144K paid-in; and they wouldn't actually do this deal - they'd require some cap reduction to the tune of $50K or more.

I told them a reasonable market-rate deal (but not one I'd necessarily take) would be:
$250K car
$185K residual
8% rate
nothing up-front
Which nets to about four gees per month, for a net of $96K. Factor in returns on the purchase price not spent but invested; and on your payments invested during the 24 months and it's not a horrible deal in the end. I would have considered it. They wouldn't :-)

All that said, my not-leased 355 shows up next week for less than they wanted in total lease payments on the 360. The 360 Spiders are still priced wacky.

Doody.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1692
Registered: 5-2001
Posted on Friday, March 29, 2002 - 7:25 am:   

Frederick,
when did you get on the list?
R U getting a Spider?

Production cut back? Bull if you ask me. And to make my point even more, it is dummy buyers set up by Ferrari dealers that are on the list with you Frederick, that hold contracts, most of them pushed in front of you by the same dealer, that will take delivery but turn it right over to the dealer. They never intended to buy the car in the first place, never put up money just to the dealer can receive the car and put it back out there for "a shitload" more! Fair to you the consumer that just wants to drive and enjoy his car?
Lou B (Toby91)
New member
Username: Toby91

Post Number: 22
Registered: 4-2001
Posted on Thursday, March 28, 2002 - 3:51 pm:   

It would be interesting to know what residual values are being negotiated on 2 or 3 year leases for these market price deals.
Robert Jude Klein (Rjklein4470)
New member
Username: Rjklein4470

Post Number: 37
Registered: 3-2002
Posted on Thursday, March 28, 2002 - 3:45 pm:   

I gues it also depends if you are leasing the car or buying the car, for somebody who is leasing the car untill there order comes up, the 60k or so might not be that big of deal over the lease
Tyler (Bahiaau)
Junior Member
Username: Bahiaau

Post Number: 189
Registered: 12-2001
Posted on Thursday, March 28, 2002 - 3:19 pm:   

Well said Lou.
Frederick Klorczyk (Fjk)
New member
Username: Fjk

Post Number: 41
Registered: 12-2001
Posted on Thursday, March 28, 2002 - 1:54 pm:   

My point is that it is curious how a couple thousand miles drops the price from the previous recent low that I recall of about $260 for a 300 mile car especially with spring here. Just now, after four years on the market, used 1999 coupes are finally approaching their new car MSRP of about $140K. It will be interesting to see if/when the spiders reach that point during their production run.

I have been on "the list" for quite awhile now - was supposed to see my car in Spring of 2003 - now Fall of 2003 due to a production cutback as told a few months ago.

A "shitload" of money is relative and everyone's "shitload" is different. I don't think Enron's Ken Lay thinks a quarter mil is a shitload...

There really won't be that much difference in price between a specially ordered spider due in 2003 - probably around $200K and the $240,000 for the 2000 mile 2001 I referenced earlier. Plus, you get the car now instead of then. I am just choosing to keep waiting it out to order it the way I exactly want it. When you spend a shitload of money you should get what you want and I haven't seen that yet.

I bought my 2001 Porsche turbo for over sticker as I was negligent in getting on the list. It was equipped as I wanted it - sunroof delete as I am tall. It was/is worth every cent in my mind and my mind is all that counts to me.
Lou B (Toby91)
New member
Username: Toby91

Post Number: 21
Registered: 4-2001
Posted on Thursday, March 28, 2002 - 12:48 pm:   

Why are many of you getting so hot about a market price deal between two consenting adults? You pay your money and have your fun when you want to. I suspect many people think we all are nuts for spending what we did on our cars. Its capitalism folks.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1685
Registered: 5-2001
Posted on Thursday, March 28, 2002 - 12:30 pm:   

na, they don't have the cash anymore :-)

the dealer has the cash!
Andrew Menasce (Amenasce)
New member
Username: Amenasce

Post Number: 25
Registered: 10-2001
Posted on Thursday, March 28, 2002 - 12:08 pm:   

Tim dont feel sorry for them ..afterall if they are spending 240k$ on a 160k$ car why should we feel sorry ? they have the cash and the car !
Tim N (Timn88)
Member
Username: Timn88

Post Number: 592
Registered: 6-2001
Posted on Thursday, March 28, 2002 - 10:06 am:   

They can charge that because people will pay it. I sort of feel sorry for the sorry bastards who have to pay that much because they didnt order theirs but there is like a 4 year wait though, so its understndable. I guess if you can afford it then go for it, you only live once. Just to me 240k is a shitload of money.
Martin (Miami348ts)
Intermediate Member
Username: Miami348ts

Post Number: 1682
Registered: 5-2001
Posted on Thursday, March 28, 2002 - 9:43 am:   

they are f*$%ing nutz!
Frederick Klorczyk (Fjk)
New member
Username: Fjk

Post Number: 40
Registered: 12-2001
Posted on Thursday, March 28, 2002 - 9:05 am:   

Just noticed some 2000 mile cars for about $240K at a FNA dealer.

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