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BMW NA Each year, BMW delivers fewer than 2,000 high-performance M5 models—which are built to order and start at $86,000.
Edmunds.com, the car-shopping Web site, keeps track of cars that are currently trading at or above the sticker price, and it’s a surprisingly long list, given how downtrodden the economy has been.
“There are some signs of life for particular vehicles,” says Edmunds market analyst Jesse Toprak. “If you have the right car, you can still sell it.”
Of course, many of the entries are low-volume, high-priced exotic sports cars, such as the $120,000-and-up Aston-Martin Vantage or just about any Ferrari. BMW AG’s high-performance M models—the $86,000-and-up M5 and the more-than-$100,000 M6 sedans, and the performance-enhanced versions of its X5 and X6 sport-utilities, both priced above $85,000—make the list. These cars are essentially made to order, and BMW ships fewer than 2,000 of each per year.
Yet there are few more-modestly-priced models from less-ostentatious brands. Cars from BMW’s Mini brand, which start at just under $20,000, are selling for close to sticker price, according to Edmunds, despite the brand’s last-place showing in the latest J.D. Power & Associates survey of new-vehicle quality released Monday.
Hybrid versions of Ford Motor Co.’s Fusion sedan are selling right around sticker price, according to Edmunds. It projects that Ford’s new, 365-horsepower Taurus SHO sedan, which starts at nearly $38,000, including freight charges, will also sell for close to sticker when it goes on sale later this summer. Toyota Motor Corp.’s just-launched 2010 Prius is trading at close to sticker price, according to Edmunds.
Another piece of hot Detroit iron is General Motors Corp.’s new Camaro, a reincarnation of the iconic late 1960s version of this Chevrolet muscle car, which starts at about $23,000. At Great American Chevrolet in Hackensack, N.J., general manager John DeSantis says the dealership is asking $2,500 over sticker price for its in-stock vehicles—and he says that’s modest compared to what other dealers are charging.
“We understand that a lot of dealers are capitalizing on the fact that the car’s new,” Mr. DeSantis says.
But given that the American people are the main shareholders of GM, they should welcome the idea that a GM car or truck is desirable enough to sell above sticker price—which usually means the factory and the dealer can make a profit.
Some Camaro fans are griping about the extra charges. But supply and demand isn’t just a concept for Econ 101.
“The car is very difficult to get,” says Scott Volkert of Newman Chevrolet in Cedarburg, Wis. Mr. Volkert, who maintains the Web site www.camaroscotty.com, says his dealership isn’t charging a premium because it wants to build customer loyalty. Besides, he says, GM’s plans to sell 80,000 to 100,000 Camaros a year will eventually mean the end of the scarcity premium.
What all these cars have in common is a distinctive blend of the Three S’s of pricing power:
Style. The Mini’s distinctive looks outweigh the quality gremlins identified by J.D. Power. The Camaro’s distinctive retro-modern lines blow away worries about GM’s status as a ward of the state.
Speed. Just about all these vehicles offer performance that’s better than average, or a lot better than average. That includes the hybrids, if you take the view that for some, exceptional performance means high mileage and high technology.
Scarcity. Last, and perhaps most important, this pricing-power tool has eluded most mass-market car makers for much of the past decade. But Mr. Toprak, the Edmunds market analyst, says consumers should watch out: The industry’s drastic production cuts are setting up a situation where more cars could start to crack a “selling for sticker” list late this year or next.
If the newly enacted federal “cash for clunkers” program succeeds in clearing out more leftover vehicles this summer, prices could start rising this winter, Mr. Toprak predicts.
“From a consumer angle,” he says, “there’s almost a perfect opportunity from now to the end of summer.”
—Email: Joseph.White@wsj.comClick
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