- Sep 11, 2009
Shelby lowering price of $20k GT500KR hood after web outrage erupts
Shelby GT500KR - Click above for high-res image gallery
When we drove the Shelby GT500KR at Miller Motorsports Park last May, we were impressed with the steps that Ford and Shelby had taken to make its new King of the Road a special vehicle. Not only was the KR a huge improvement over the GT500 (which led to the development of the 2010 GT500), but the car featured trick items like a carbon fiber hood and lightweight wheels wrapped with R-compound tires. At that time, Shelby also proudly told us that none of the KR-specific parts would be available for sale separately to ensure that owners of lesser Mustangs could not make shadetree replicas that might compromise the KR's image. Of course, all of this exclusivity and performance came at a price: $79,995 to be exact.
Unfortunately, as one GT500KR owner has learned the hard way, replacement parts for this pony car can be surprisingly dear. After an unfortunate incident with a critter on the road resulted in a modestly damaged front end, the owner in question was shocked to learn about the high cost of his vehicle's replacement parts. And as is increasingly the way these days, he aired his displeasure on the web. That initial report has since touched off a firestorm in the online Shelby community, with the issue spreading to numerous forums and chat rooms.
So just why were these replacement parts such a contentious issue? In the main, it's a numbers thing. As in $18,400 for a new hood, $3,392.50 for a front spoiler, and even $632.50 for a set of hood pins, among other things. Further, the disgruntled owner informed a forum member that Shelby requires any damaged KR parts to be returned to their facility in Las Vegas before new replacements can be sent out.
Obviously, a bit of due diligence was needed to verify the claimed replacement pricing and parts return policy, so we got on the phone with Jim Owens, vice president of marketing and communications at Shelby to get the straight scoop. Click through to the jump to hear what we learned.
Photos copyright ©2009 Drew Phillips / Weblogs, Inc.
[Sources: Spokentorque.com, Team Shelby]
As it turns out, the parts pricing cited by the owner was correct. And while the hood's cost in particular sounds exorbitant, Shelby's Owens took pains to explain that not only is the part in question the only full carbon-fiber production hood available in a U.S. vehicle (read: it's expensive), it has gone through the same exhaustive certification procedure as any other OEM product – including crash testing (read: really expensive). Says Owens of the hood:
"I will tell you – there was no less design, engineering and testing - that went into this component... than goes into any other component in the exotic car world. It was the single biggest piece of this program."
Given the small number of GT500KR units manufactured, the hood's associated research, development and manufacturing costs turned out to be particularly high, and those factors were calculated into the replacement cost using an off-the-shelf parts pricing matrix. Said another way, Shelby says it hasn't grafted an exclusivity surcharge onto these KR parts – it maintains that the company has used a standard cost formula to determine how they should be priced.
Despite this, in the interest of assuaging owner fears and staving off more negative feedback from various online communities, Shelby's Owens says that it has reconsidered its pricing strategy on the KR's hood. To wit:
"So, we got the feedback off of the websites – the Team Shelby site specifically. Based off of that fact, we are lowering the price of the hood - substantially. We're lowering it to $9,700. Additionally, we are now also going to go through all of the remaining carbon fiber components and take a look at that pricing, including skullcaps and splitters."Owens indicates that Shelby has been in extensive discussions with the affected KR owner's insurance company, State Farm, and although company representatives have yet to speak directly with the customer, they plan to do so. Still, State Farm reps were understandably nonplussed when they got their client's initial repair estimates from Shelby and the whole process is taking months to set right.
For clarity's sake, Owens pointed out that hood replacement is not a widespread issue – just three KR hoods have been replaced – the animal-damaged piece on the vehicle in question, as well as two dealer units that were damaged in shipping and transportation.
But there's more to this story. Perhaps just as interesting an issue is Shelby's parts-return mandate. The reason that Shelby requires damaged KR parts to be returned to the company is in the interest of maintaining exclusivity. It's exactly the same reason why the company has declined to make KR model-specific components available to aftermarket buyers. Says Owens:
The last thing we wanted was a V6 Mustang customer going over to his dealer, grabbing one of those KR carbon fiber hoods, and slapping it on his V6. To me, that's more of a disservice to our customers and brands – both SVT and Shelby. So that was our guiding principal, if you will... So when we set up the returns - the warranty and service parts return piece, we wanted to make sure we got those components back so that they were not on the aftermarket."
Just how serious is Shelby about getting those KR parts back? Perhaps some of you remember the recently departed NBC Knight Rider redux – a number of KR hoods were used on K.I.T.T. in the production of that television series. Shelby even managed to get those parts returned.
It should be noted that the scenario in which an automaker sees fit to call back old parts after a repair is hardly new. According to Owens, Ford, General Motors and other automakers have similar policies in place – presumably the difference is that they rarely choose to exercise those provisions – or perhaps it's just that customers are generally unaware of this practice. In effect, Owens says that the automakers have a right to call back damaged parts after dealers put them on the shelves in their backrooms: "In Ford's warranty and in General Motors' warranty... they have what is called 'parts retention'... Ford has a right to call back parts after a certain period of time. We just made these mandatory parts returns." Presumably, in most such cases, those damaged parts are returned to the parent automaker for failure analysis to improve future product quality – a factor that may or may not also be at work here. In any case, Shelby itself pays for any shipping costs associated with the parts.
When we asked what happens to a returned part, Owens replied:
"We have a complete building's worth of KR inventory on our property in Las Vegas that is caged, fenced, and has cameras on it. And it [the item] goes into our warranty parts return section. And we will keep it there, and we will destroy it after a period of time."
Unlike some previous takeoff parts from other models, Owens says Shelby isn't even using KR parts for auction prizes to support the Carroll Shelby Foundation, a charity organization that works to provide assistance to children in need.
Finally, we had to ask: What happens if an owner is not in possession of the damaged KR parts – meaning that they cannot be returned to Shelby? Maybe the vehicle was in a crash and the owner was hospitalized and nobody had the presence of mind to make sure the parts were accounted for at the scene of the accident. Or perhaps just as likely, what would someone do if their KR were stripped? Owens says that Shelby evaluates each customer inquiry on a case-by-case basis, so presumably with plenty of documentation (think: VIN, police report, copious photographs, etc.), the damaged KR will be repaired.
What do you think of all this? Is Shelby handling GT500KR parts replacement in a fair manner? Is exclusivity worth encountering these sorts of stipulations? Drop your fellow readers a line in 'Comments.'