Letter of Intent

My friend had to sign a letter or they would not let him buy the car. If he sells the car in the 1st 2 years the dealer will buy the car back at the price my friend paid. He got the car at sticker so they would buy the car back at sticker.

 

doesnt seem to be a win/win for the dealer...what if the car all of a sudden decided to depreciate instead of appreciate, as in F 430's these day. I am sure the dealer has an option, but doesnt have to exercise it.

 

I think there is some merit to this practice. It might stop people just getting on the list to profit from flipping the car. That should allow people that genuinely want the car an opportunity to purchase. Further, it is much more ethical then the dealer just selling to a friend and then reselling it to someone else at a higher price.

 

Interesting setup - definately in favor of the dealer. However, I supposed it is still "fair" in a sense.. That is if you got a good deal on the car to begin iwth. I guess you can't really lose, but you also can't gain. Free option for the dealer.

However, later buyers would potentially benefit by eliminating the "flipsters" however, the market is either there or not, and if its not sold private, the dealer will surely sell it (for probably more than private..). So afterall, it seems there would be no benefit for the consumer. Just the dealer.

 

To my knowledge, the Honolulu Ferrari dealer does this also.

 

Yes, I will be the first one to sign one of these at this dealership. I have no issue with it since I plan on driving the car. I have no intention of capitalizing on the exisiting market value of these fine sport cars. I will be signing it this weekend when I place my order!!!
Dealer has first right of refusal in the sale of the car.

 

I doubt it'd hold up but you can kiss another one at sticker goodbye if you don't comply. Bottom line is dealers are moving more towards market price IOW they get you one way or another.

 

I'd like to see a copy of that.

This to me smells of restraint of trade at minimum!

 

How is this not extortion?

 

What's wrong with this? They are allowed to impose any conditions they like when selling you a car so long as it is within the law. Ferrari simply want to have extra contol over what happens to their cars - Porsche UK are well known within the trad of doing just about everything they can to control used car values. Do you think any of the FXX buyers were concerned that they weren't allowed to sell their cars on within a period of x months?

Also surely extortion involves being forced into giving money, not signing an agreement saying you won't sell your car at a profit.

As regards restraint of trade, it's no problem so long as it is the dealer's decision to impose these conditions, not Ferrari's. If it were Ferrari's rule and all dealers were forced to abide by it, then that would possibly be restraint of trade.

 

They want it back so they can "Flip it". I had my dealer tell me he wouldn't sell to someone that "flips the car". I was impressed. He than went on to tell me that it would be ok for him to "Flip it" for them and split the difference. That way he doesn't piss off Ferrari!! SCUM!!!!!!!!!

 

Sounds like he was fishing a bit to see if you'd play along.

 

No. I was buying the "Flipped Car"!

 

I was asked to sign a "right of first refusal" when I purchased my SL55 AMG a few years ago. It was the 2nd car the dealer delivered in town and as you may remember, SL55's were also quite "hot" for 6 months or so, bringing $20k over in most markets.

I refused to do so on the terms presented--the dealer gets to buy it back at the lower of my cost (MSRP) or the offer from price of third party buyer. In my opinion, it was indeed, an illegal or at least unethical request.

I pointed out my problems with it--that it gave them a free ride/look at my expense. Instead, I offered them a 12 month right of first refusal ( 3 business days to decide) on repurchasing the car at whatever price was offered for it from a third party. They agreed.

As it turns out, I sold the car approximately 12 months later--moved on to another car, but by then the "premium" had disappeared so the dealer was faced with buying it at "slightly less" than what they'd "sell" it used for. As agreed, I gave them the third party price; they declined and so I sold it to someone else.

My position is that I'd never sign an agreement like the original one they proposed or like the one that appears to have been offered to F1Fan 430.

Why should I "inventory or floor plan" their used car with my money so they can turn around and sell it at a profit after buying it back from me at a low ball price--just for the priviledge of driving it? Not a chance. I'd buy something else or a used model not carrying a premium.

Ferraris are wonderful cars but they "ain't" worth that much to me--I've owned too many great cars to care enough about any one to prostitute myself to a local dealer just to own it.

 

It is the purchasers choice.
No sign, no buy car.
Yes sign,buy car.
Sell to another without presenting opportunity to dealer first, dealer will not sell you another at list ever again.
Purchaser should understand the consequences of the action.....

 

You sound like a Dealer!

 

This kind of crap has led me to buy a 997 GT3

 

Do you think a dealer should be able to sell a new car at the market price? If not, do you like the practice of someone purchasing a Ferrari and flipping it requiring a real Ferrari owner to pay more because this guy was on the list? How do you suggest you stop it?

If you really want the car you shouldn't be too concerned about holding / enjoying the car for two years.

 

What about a deal where the dealer sells the car to you at MSRP with a signed letter, or market value without a signed letter. It is my observation that more Ferrari dealers are moving away from selling just at sticker (and I can't really fault them--why leave all that potential profit to someone else). This protects their potential profit, yet gives them a way to take care of good customers. (Of course, if you are really good customer, buying Masers and V12 cars--you should get the car at MSRP without signing a letter.)

 

"As regards restraint of trade, it's no problem so long as it is the dealer's decision to impose these conditions, not Ferrari's. If it were Ferrari's rule and all dealers were forced to abide by it, then that would possibly be restraint of trade."

That position may be true where you live but not so here in the US.

And whether it's Ferrari, the dealer, or both, it is not a valid buyer limitation!

And if it's Ferrari and the dealer, then we are dealing with conspiracy and its resultant penalties.

 

Hmm, he doesn't seem too shy about telling you how the game is played. Tell him you're ready to play at sticker. You'll be driving for free before you know it

 

No, I am not.
This in contracted grammar is what was said to me.
The conversation with the dealer was longer than this.
But these are definitely the main points.

 

Our input makes no difference, they will sell every F430. Just an FYI Ferrari of Central Florida to my knowledge does not do this.

 

Took delivery in mid-July and was not asked to sign anything like that, but wouldn't have any trouble signing one if asked. I have a 20 year business relationship with my dealer buying and trading Ferraris. They've always been terrific to me.