That may have something to do with it, but I don't think the Ford family would go along with it. Eventually, Ford Blue will die, leaving Ford e standing. Once that happens, they'll probably just go back to being just Ford.
Ford is saying very little about their future business model plans as it pertains to dealerships, but I think Ford will ultimately want to be able to sell directly to the consumer. They'll be able to use Tesla's model as a track to run on. We're already seeing ads by Ford, incentivizing people to order their vehicles online. Dealers will be paid a commission for doing PDI and delivery.
Ford started something like this once and got bulldozed by the Ford Dealer's Council, it quickly failed.
2020 was a long time ago?
2 human years is 100 Bronco reservation years. It's science.2020 was a long time ago?
Good article. I don’t think dealers are going to go away, but they will definitely change. I like the agency model that was quoted in the article. Europe is transitioning to this model. You purchase the vehicle directly from the OEM. The dealer is paid a commission to do the PDI and delivery. The dealer has plenty of opportunity to sell additional products, deal on trade ins and possibly financing. If your business depends on laws to protect your business model, you’re in trouble.
Shangai’s one thing, rural China, India, Africa etc. is another.
Times are changing I think. I have had positive experiences with the dealer but every dollar of ADM that goes in the pocket of Mr. 3rd generation car lot king is a dollar out of the OEMs margin. I place some of the fault at the OEM pricing, they should be more reactive to the market, to the point that MSRP chases the lower acceptable range of what we now call ADM (probably illegal because of the dealer cartel laws).
That is good to hear, @TeocaliMG, I highly respect your consumer feedback as a Bronco enthusiast and Ford engineering employee. As a fellow engineer, but in the aerospace industry, I've also worked the business side of the house so I may bring a little bit of a different perspective.
Ford actually started doing this in 2017 with Ford GT sales and will close out this model's production run this year using it. You place an order directly through Ford and final paperwork, payment, and delivery was handled by dealership of the buyer's choice. No ADMs allowed that I'm aware off. Vehicle cost was MSRP plus TTL.
I agree whole heartedly that the practice is not sustainable long term. I think most of the time you see outrageous ADM is when there is a period of time when supply and demand are way out of normal ranges. My point is only that the OEM gets "shafted" because they are the ones who provide the incentive when the tables get turned, but when you have the short periods of hyper demand, they get practically nothing. That effects the bottom line. This period of time may not last long but when you apply it to every dealer for each applicable model for its period of high demand, that certainly would add up. As much as everyone would like to see no ADM (or OEM equivalent) the OEM should operate right at the intersection of selling vehicles literally as fast as you can make them and selling cars for absolutely as much as allows that to happen. Right now OEMs have to share or surrender that second lever to the dealer.
