"We're betting on dealers. We're not going to go direct." - Jim Farley on EV dealers

[Squatch Parade]

https://www.cnbc.com/2022/09/14/for...s-dealers-as-it-chases-tesla-like-profit.html

“We’re betting on the dealers. We’re not going to go direct. But we need to specialize,” CEO Jim Farley told reporters Tuesday after briefing dealers about the plans. “The main message I have for the dealers, which I’ve never said before, because I didn’t believe it was true, is that you could be the most valuable franchise in our industry.”

Sorry, it's not looking like price gouging is going to end anytime soon.

There is some rhetoric about non-negotiable pricing, but doubt that's what we were hoping for.

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[Razorbak86]

https://www.cnbc.com/2022/09/14/for...s-dealers-as-it-chases-tesla-like-profit.html

“We’re betting on the dealers. We’re not going to go direct. But we need to specialize,” CEO Jim Farley told reporters Tuesday after briefing dealers about the plans. “The main message I have for the dealers, which I’ve never said before, because I didn’t believe it was true, is that you could be the most valuable franchise in our industry.”

Sorry, it's not looking like price gouging is going to end anytime soon.

There is some rhetoric about non-negotiable pricing, but doubt that's what we were hoping for.

The “clear and non-negotiable pricing” is only for EV sales. That’s always been Farley’s position during his quarterly conference calls with analysts and investors, because Tesla is his real competition for EV sales, and Tesla does not make or sell ICE vehicles. Unfortunately, most media reports miss that subtlety, so many of the members here who read those reports miss it, too.

 

[flip]

Sound bite.....The national dlr meeting is happening now, we decided not to go but I don't think he was talking about value in the sense of profiteering from sales. Quite the opposite, new dealer agreements will soon be coming for those that want to sell EV which I'm certain will have tons of pricing controls. He's already said the dealers need to cut $2K from the sale of an EV and dealers will need to make up revenue in other ways like accessories. Sorry, there isn't that type of margin built in to cut, savings will need to be made at the production level by controlling costs and leveraging their buying power.

My prediction is that a lot of smaller dealers are going to be crushed by some of the corporate changes and may only be limited to ICE sales where they could do EV and commercial before. We'll get the full release notes from later this week but it's going to be brutal from what I've heard already.

 

[66Fan]

Because the real way to win over squirrels is to reduce the number of nut bearing trees, then place predatory birds in those that still exist.

Makes sense Ford. Totally.

 

[flip]

Ford dealers must set no-haggle prices, invest up to $1.2 million to keep selling EVs | Automotive News (autonews.com)

 

[F OR D]

Real snippets below. Also note Ford is moving to EV, so this IS the future. Summary is Ford going EV, wants dealers, dealers need to follow rules to sell EV. This is good if you actually read it.

Farley wants Ford’s retailers to cut selling and distribution costs by $2,000 per vehicle to be competitive with the direct-to-consumer model.

Aside from the investments, dealers who opt into selling EVs will need to abide by five standards to stay within good standing: clear and non-negotiable pricing; charging investment; employee training; and improved vehicle purchasing and ownership experience for customer, both digitally and in-person.

 

[PrepVet]

Until idiotic laws change Ford cannot legally sell direct. So this is literally a nothing burger and no one should be surprised/upset/pleased with this statement. It is hun literally saying how things are legally required to be.

 

[MayhemMike]

Sound bite.....The national dlr meeting is happening now, we decided not to go but I don't think he was talking about value in the sense of profiteering from sales. Quite the opposite, new dealer agreements will soon be coming for those that want to sell EV which I'm certain will have tons of pricing controls. He's already said the dealers need to cut $2K from the sale of an EV and dealers will need to make up revenue in other ways like accessories. Sorry, there isn't that type of margin built in to cut, savings will need to be made at the production level by controlling costs and leveraging their buying power.

My prediction is that a lot of smaller dealers are going to be crushed by some of the corporate changes and may only be limited to ICE sales where they could do EV and commercial before. We'll get the full release notes from later this week but it's going to be brutal from what I've heard already.

Your prediction is dead on. The plan in the works is to create two types of dealerships. ICE only, and EV only. This was published several months ago.

 

[CJSimmons]

Sound bite.....The national dlr meeting is happening now, we decided not to go but I don't think he was talking about value in the sense of profiteering from sales. Quite the opposite, new dealer agreements will soon be coming for those that want to sell EV which I'm certain will have tons of pricing controls. He's already said the dealers need to cut $2K from the sale of an EV and dealers will need to make up revenue in other ways like accessories. Sorry, there isn't that type of margin built in to cut, savings will need to be made at the production level by controlling costs and leveraging their buying power.

My prediction is that a lot of smaller dealers are going to be crushed by some of the corporate changes and may only be limited to ICE sales where they could do EV and commercial before. We'll get the full release notes from later this week but it's going to be brutal from what I've heard already.

It's hilarious how Farley talks about all this when 1) There is little to no markup from MSRP to invoice on Ford EV's and 2) He is raising the prices of Mach E and Lightning by 4-5k from 2022 to 2023. At any point during the last year Ford could have rolled out rebates if they actually cared about the market increases at dealers, instead he scapegoats dealers into being the bad guy he has no control over.

 

[Sonny]

It's hilarious how Farley talks about all this when 1) There is little to no markup from MSRP to invoice on Ford EV's and 2) He is raising the prices of Mach E and Lightning by 4-5k from 2022 to 2023. At any point during the last year Ford could have rolled out rebates if they actually cared about the market increases at dealers, instead he scapegoats dealers into being the bad guy he has no control over.

Looking at what I paid for my Bronco vs. the MSRP, I'm pretty sure the dealers are the bad guys right now. But that's just my opinion.

 

[flip]

It's hilarious how Farley talks about all this when 1) There is little to no markup from MSRP to invoice on Ford EV's and 2) He is raising the prices of Mach E and Lightning by 4-5k from 2022 to 2023. At any point during the last year Ford could have rolled out rebates if they actually cared about the market increases at dealers, instead he scapegoats dealers into being the bad guy he has no control over.

I need to do some digging to see if the pricing context was in relation to transaction price (which would make sense if he was talking about ADM) or triple net. Our cost is our cost so if they cap the vehicle sale price it would mean they control what we're charged AND what we can sell it for. That doesn't make much sense because the margins on these are already thin, they could just say, dealers have to sell these at no profit and try to make it up on financing, trade, ESP, prepaid maintenance or accessories. All of which would be a non starter and probably generate a ton of push back from the entire dealer body.

 

[hemiblas]

It is pretty obvious that Ford values their dealers more than their customers.

 

[Aman]

It is pretty obvious that Ford values their dealers more than their customers.

Ford's customers are the dealers. The dealer's customers are the end consumer.

 

[flip]

Your prediction is dead on. The plan in the works is to create two types of dealerships. ICE only, and EV only. This was published several months ago.

And Commercial Pro. We do a fair bit of commercial and will have to deal with their new rules and standards along with EV.

 

[Lifeliberty]

No one is forced to buy a ford, do people forget that? This isn't a big deal deal. If you don't like the price spend your money elsewhere

Klaben Ford in Warren and Kent advertise MSRP pricing, nothing above it. Just shop smarter. Stop giving your money to people who don't respect you. At this point, it's the customers fault, not Ford's

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