No. of Recommendations: 0
The Profit PER UNIT goes UP 30%--but the Number of units SOLD goes down by 50% to 75%.Do you have some data on demand elasticity with respect to price?
What I am proposing is 50 year mortgages would qualify people for a 3500sqft McMansion, who are currently priced out of the market, because no-one wants to bother building 1200sqft houses. Meanwhile, people who currently qualify for a 3500saft house, could qualify for a 5,000sqft house (picking numbers from the air for illustrative purposes). More people in the market, and Pulte taking more money off of each of them. Of course, eventually, Pulte would stop building 3500sqft houses, because they would drag down their ATP and GP metrics.
Farley seems to think the road to profit nirvana is built on progressively bigger, more expensive, vehicles, and the elimination of everything below average.
Ford CEO Farley Says Two Row ICE Crossovers Going Away
FoMoCo isn't exiting the ICE business anytime soon, but does plan on reinventing that lineup by focusing on passion brands and exiting slow-selling or low-margin segments, much in the way it stopped selling sedans in the U.S. years ago. However, the Ford CEO provided even more clarity on this matter during the automaker's recent earnings call by noting that The Blue Oval won't be making and selling ICE-powered two-row crossovers in the future, too.https://fordauthority.com/2023/02/ford-ceo-farley-...I wrote Farley off as a buffoon, who sits in his echo chamber, waiting for the yes-men around him to validate his latest brain fart, but that's just me.
Steve
