McLaren Depreciation 12-C: a nightmare- werewolf?

Well, that actually is and is not true.

The true part is yes, some people won't buy them with dealers so far away. I know some in Las Vegas who are interested but don't like the idea of sending the car to Newport Beach for service -- even if NB is a great dealer and doesn't mind it.

And, how many live more than 100 miles from a Ferrari dealer and still buy them new? Lots.

The not true part is that same store sales of M's is LESS than F's in the same larger markets -- and sometimes in the SAME DEALERSHIP selling both head to head -- so if you remove the dealer as part of the equation, they still don't sell at the same rate (or even close). And, fewer dealers means that they can attract a larger customer territory.

The lack of dealers has something to do with it but I think it's a wash when considering other factors. If you really want one, you'll get one.

 

I live 180 miles from the dealer... 3.5 hr drive. It's a fun drive. Or FoD will come and pick it up.

works for me.

 

^^^^^^^^
Exactly. But you have to want one first.

 

Well said - McLaren's biggest problem is itself.

The acid test is this: if you want a new 12C you can get one in 24 hours due to oversupply and "forced" market presence.

You want a new 458, good luck getting one in less than 10 months.

The only worse thing McLaren could do would be to supply cars to dozens of "Rent an Exotic" businesses......

 

There is no formula for successful entry into an existing competitive market. Do you go in gradually with an initial small production to try to build demand? Do you try to make a big splash using a big marketing campaign and image building? Do you try to leverage what you think is a unique product with sweeteners to attract early adopters?

The Mayor is right in his analysis of mistakes made. McLaren misjudged the demand side of the equation, and subsequent sweeteners (e.g., boost increase) were not enough to attract sufficient buyers to the 12C.

And things are not so good with the P1 either. That market -- for reasons I don't completely understand -- has a fixation on Nurburgring times. There the 918 has aced the P1 (see threads over in that forum) while LaFerrari is playing it cagey.

If I were an investor and had been treated to this spectacle, I would not be a happy camper.

 

I am very far from my dealer but they will also come pick up the car. My dealer experience was wonderful. I am glad I drove the 12C and cought one before I read this thread.

I will use my dealer and when the warranty is over buy the next model. I also have the option in my small town to have it worked on.

I do love the "werewolf" moniker, very clever

Best

Lee

 

I said many years ago they were making a mistake going head-to-head with Ferrari right out of the box.

Their target should have been Porsche (a larger market and easier to start to attack), make a 911 beater that people liked, get their dealer network going, get production up to the point where their parts suppliers will be self-sustaining, and make a great success story for themselves which they can build on. Then, move up the ladder.

But, unfortunately someone there (Ron) has this weird fixation with someone (Ferrari) and has to try to beat them at their own game if not on the track.

The way to build was from the ground up, not down and sideways. Ron bet the 12c would beat the Ferrari in performance and technology, people would care, and thousands would switch. Well... they don't really care. And to some degree, Ferrari has vindicated itself by weathering the storm. The next challenge will be from Honda. They've survived that one before too.

The world is a better place with the 12c in it. I'm just not sure it's making its investors or dealers any money.

No money, no honey.

 

The only thing that might end up helping the 12C Coupes are that very little came in for 2013 and by special order for 2014.

 

Man, do you get it!!!
I totally agree. They've made the 911 obsolete but Ferrari maybe not yet
Will be interesting
I kind of enjoy the full on attack, I mean WTF? They have the backing from the Middle East

 

That will help. The problem is they also need to rebuild trust to bring in new buyers. Anyone who looks at 12c used prices now has to be spooked.

What I said they should do is what they did in Australia: reduce the MSRP significantly and then offer a rebate back to early adopters to buy another car.

That would rebuild the brand and make new potential owners know McLaren views customer loyalty better than it's competition.

Expensive? Yes. But they were going to lose all the dealers in Australia if they didn't. Necessity is the mother of invention.

 

Bob as you know I was one of those early buyers that paid full MSRP, in hindsight not a good move, but saying that, it will make me want to keep the car a lot longer. However, I still have an itch for a 458, but thanks to the depreciation of my 12C, I will have to buy the 458 used, to make up for it in my mind.

 

I did not mean to suggest Mac would sell as many 12c's as 458's, they don't need to. They just need to sell a few more than they have. I'm sure they could sell 1-2 per month in a city of 5 million like Houston. That would go a long way in promoting the brand and cutting inventory.

You are correct in saying "if you really want one, you'll get one", but Mclaren doesn't have that kind of following yet.
There are many people that don't know they want one until they see and drive one.

 

I think they should do for you what they did in Australia -- let you buy a new one at a discount so that you are not so far underwater but freeze the MSRP price for everyone else.

It's not your fault they shipped too many cars to the states. That decision was made in Woking. That mistake can be corrected -- but it takes money.

If you look at the used M market, there's some fantastic deals out there. Dealers are even selling new spiders at MSRP while we know that used 458 spiders are still well above that (but falling).

If I were a new buyer, unless I just wanted to throw 60 grand away in 6 months, I'd be really skeptical to jump in now until I had some degree of assurance they weren't going to do it again.

This is a fixable problem. The question is: how much pain do they want to endure to fix it?

The good news for you: you bought the right color!

 

I ordered a new italia this year by talking to the dealer, putting down a reasonable deposit, and I have received the car. At sticker price. And, i had not bought a car from them before. no need to buy a FF or whatever. If you are located near a dealer, technically you have to go thru that one. If you are 100 miles or more away, you can order new from any dealer (this is in the US). Hope this helps


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Are you basing the depreciation on the 2nd hand prices being offered by approved Ferrari dealers in the UK? I know from a good source at a leading Ferrari dealership that the bid/ask (trade in price /resale price) has never been wider because there is alot of supply available and risk of left dealer holding cars. You'd be shocked what you get offered. It also looks like their are also not enough 2nd hand buyers to sustain a much higher price than we saw with previous generation 430 (roughly £40k higher). FF and California are worse than 458, but I have n't noticed the list price being lowered yet.

UK still gets about 10% of all Ferrari's built so no change their. Sounds like US must be getting less supply than in years gone by. I know Ferrari can make more money selling cars to Middle Eastern and Asian clients where they are very much a status symbol and the more they cost the better as far as alot of buyers are concerned!

I think Ferrari owners (and I am one) like to believe that Ferrari are worried about the 2nd hand prices but in reality they're not. Production numbers increase each year and when you buy new you're paying a big premium for a prestigious brand like Ferrari and they know that. Mclaren does not quite have that loyalty to support the price particularly in US.

 

I assume McLaren will get in 2014 even more under pressure. McLaren is not only fighting against Ferrari!

Lamborghini will launch the new Cabrera, the new Porsche GT2 models will also enter the market soon and one year later Audi will launch the new R8. These three producers have with Volkswagen one of the most strongest financial partner behind and additionally an enormous portfolio of technology to share. And I'm sure Ferdinand Piech is satisfied only with the absolute market leadership. Therefore we can expect absolute top products from this corner.

Hope McLaren can react up to that point with innovative product ideas and (hope it's not too late) a better after sales service (my experience here in switzerland). Also middle east investors expect an atractive ROI.

 

Competition is always good for the consumer. But with massive VW resources at hand, and Ferrari's market skills, it will be a tough haul for McLaren. It would help if they had world beater car, but they really do not in their respective niches.

 

Your coment " many people don't know they want one untill they see and drive one", fits me perfectly. I bearly heard of the mclaren name and did not know the car existed. My freind knew of them and we drove down to the dealer as a whim, just something to do. I fell in love and bought it one the spot.

The ferrari 458 is better at some things and the 12C at other things. As one poster said both are great cars.

Best

Lee

 

I like the quote "No Bucks, no Buck Rogers" (name the movie)

I think doing a 911 fighter should have been the 3rd move- at least as far as the USA is concerned. The simple fact of the matter is more people in the market for a 911 level car would associate McLaren with baby strollers than with a sports car. The awareness improves as you go up the food chain from sports cars, to 458 level supercars to LaFerrari supercars. I think brand is critical for any luxury item and the higher you go, the more critical it becomes.

By the time you get to that top level, I think the awareness of the McLaren F1 is extremely strong. Why not get your feet wet with a car that would completely outperform the F1 and while you're at it, outperform the many years old Enzo. A few select magazines could drive it and there would be 300 or so of these cars made. Giving the manufacturer the chance to see the market reaction and to build an interest. The car would instantly reintroduce the 458 level buyers to the McLaren brand. So long as the car would deliver the performance, price stability would likely be assured. Thus not spooking any buyers. And the car would likely be viewed as a modern classic to go along with the F1s and Enzos in collections.......

Then they could decide if they want to go max volume (911 fighter) or supercar (458). I would argue to go down to the 458 level.

To go after Porsche, which has many more dealers, more volume spread over a greater breadth of vehicles (and a very wealthy sugar daddy in VW) to me would not be the correct move. Not right away. To me this is the last of the prongs.

If they would have followed my concept, the P1 would have come out around the time the 12C did, it would have had the hyper car market to itself, captured imaginations, and given the dealers a chance to establish themselves. Then when Ferrari and Porsche are doing their hyper cars, McLaren could do something else, a trickle down from that exotic hypercar tech.

In contrast to how the P1 is seen now- some see it as a very expensive scale up of the 12C. I don't really agree with that. But it's how many see it and I think that is the death of any kind of luxury item and at the hyper car level this is an extreme luxury item.....

Anyway, that's just this man's opinion.

 

It's true that the depreciation has turned off some enthusiasts, but in reality, I don't think it's as big of a problem as some of you think. Enthusiasts really are a niche of sales.

Looks at all the other cars that have massive depreciation, no real enthusiasts, but continue to sell. Bentley, AMG, and Rolls Royce to name a few.

There are a lot of people who don't care and/or don't know any better.

And you know, it's not just exotics either. The same is true for lots of higher end cars. You can buy tons of expensive cars with deep discounts to MSRP and in great condition, but there are still people out there who will buy new for whatever reason.

Someone out there is going to get a brand new California, 458 Coupe, FF, 991, Gallardo, or SLS right now. Someone out there just placed an order for a $130K 991 when you can get a barely used one for $90K.

I don't think we should assume the bulk of the market is as aware of things or as susceptible to things as we are.

 

Coupe or Spider?

 

Excellent point. McLaren has/had a shot at the Porsche 911. Porsche will build all they can sell and then some. I have gotten several NEW turbos at under MSRP on order or on the floor.... 911s are everywhere.

 

Disagree. Fewer dealers means less awareness and less chance for folks to walk into a dealership and get interested in the cars. We're all big Ferrari fans here in this forum but a large percentage of Ferrari sales (used ones especially) come from first time buyers. I was such a buyer once upon a time. To buy a used car you generally need to go and drive it. So less players to go and drive one means less sales. Less sales means faster depreciation. BTW, once upon a time even Ferrari had this same problem. It just takes time and a good product line to solve.

I believe these problems will work themselves out over time - especially when McLaren has a larger product line to sell. The 12C is a truly GREAT car.