Huge Rebate on Lincoln Town Car – As Usual

By Brendan Moore

05.13.2007

Ford announced last week that the $7000 rebate in effect in April on new Lincoln Town Cars will continue for the Month of May, or basically, until further notice.

Ford/Lincoln does this every year with the Town Car, leading one to ask, “Why don’t they just lower the retail price to the amount they usually sell the cars for, and be done with it?” In between the heavy consumer rebates and the huge fleet discounts provided on the Lincoln Town Car, the MSRP is a joke. And this situation is not unique to this year; it happens every year.

The antediluvian Town Car was supposed to get axed last year, but somehow survived, getting by on its core customer base of 70-something consumers and commercial livery customers. Since Lincoln has been producing essentially the same car for a couple of decades, development costs are nil, the tooling is all paid for, and Ford says, hey, what’s not to like? Well, sure, as long as you have customers, but how about some more realistic pricing? At this point, the window sticker is pure theatre.

Depending on what options you get the basic MSRP on the Town Car runs anywhere from $42,175 to $50,645. Then there’s approximately $3100 to $4000 profit between invoice and MSRP. Then the rebate. Then the dealer holdback. Then, if you’re a fleet buyer, more discounting.

When I asked a Lincoln dealer why Lincoln just doesn’t adjust the MSRP downward to the actual price most people pay to drive a new Town Car away, he replied, “Well, there are still some people who see the Town Car as an excellent value at a small discount, or even no discount from dealer sticker. It’s up to the dealer to determine actual selling price”. Let me translate: “occasionally we get a customer in here (usually an elderly guy) that is unaware of just how heavily we discount the Town Car, the brand name still carries some cachet with him, and we can hit a home run off that guy in terms of purchase price”.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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3 Comments

  1. Another example of how the Big 3 hurt themselves with their customers. Since there’s no real price on the car, it breeds distrust of all the pricing on all the cars. Not a good long-term strategy. Not that any dealer cares about anything but short-term profits, but Ford should at least care.

  2. Typical dealers’ point of view. Take advantage of those least able to afford it.

  3. I like the translation – since I used to sell cars, I can verify that it is the way things work.

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