Ford Changes How Broncos are Allocated - But Doesn’t Want You to Know

[Gamecock]

#2 has nothing to do with when anyone is going to get their Bronco. This ONLY has to do with how dealer stock will be calculated once they are caught up with the reservations.

Completely false. It specifically refers to MY2021 allocations, which are all for reservations. If you don’t want to believe it, then don’t; but Ford laid it out to dealers in very straightforward fashion, and for some reason people don’t want to believe that there has been any change. It is a big change to how they were initially doing it, and will effect a lot of consumers and dealers....with consumers at big dealers, and big dealers themselves, being at an advantage.

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[307Bronco]

Edit: Lots of confusion. I take responsibility, I’m sure if I were a better writer there would have been much less.

Bullet point boil down before reading the original post:

Point 1 - Last Week Ford significantly changed the production order of Broncos (see attachment shared only with dealers).

Point 2 - Yesterday Ford revised their end consumer Q&A “Will reservations be fulfilled in the order placed?”. They either did not tell us about the Point 1 change, or they did it in a way that no one would understand. The change significantly impacts production order for some customers.

Point 3: What does it mean to me?
If you do not have a early reservation, you may not receive your Bronco in rough production order. Basically, if you order through a dealer that has outsize sales compared to their market/normal volumes they may not receive your Bronco on a timely basis. So dealership price & service are no longer the only metrics to consider.

Point 4: Ford should share this information with us and they haven’t.

On to the original post:

Ford is using full transparency in explaining they have changed the way production will be allocated by inserting the incredibly descriptive term “residency” in the new FAQ.

For those that don’t know, Ford has added a dealer allocation formula to how Bronco production will be distributed. This means Ford lied in the original FAQ when they said reservations will be fulfilled in approximately the same order as received. Ford presumably did this at the behest of large dealers who were unhappy with the large # of orders going to smaller deep discounting dealers. So now, some Broncos will be fulfilled in rough reservation order but many will not.

Also note - Ford has removed their promise of all reservations being satisfied before dealer stock is built!

Unbelievable - what slimeball moves.

Original Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, based on final ordering and production of similarly configured Broncos. All reservations will be completed before production of stock units begins.

New Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, however, actual delivery may vary based upon a number of factors including vehicle model and configuration selected, commodity constraints, residency, delivery, and final ordering and production of similarly configured Broncos.

Edit:

To add the new dealer allocation formula. This is what changes how Bronco orders are fulfilled (and should be reflected in the new QA). Some people are going to be completely screwed by this and not know it’s coming (as evidenced by the discussion in this thread - let alone customers who don’t frequent forums).

Another Edit:
I know this won’t help - but if you got this far and you think this post (and by extension Ford’s allocation change) has something to do with 1) efficiency in production; 2) shipping efficiency to dealers; or 3) exact order of reservations; you’ve misread, so try some of the other explanatory posts by others below.

Edit: Lots of confusion. I take responsibility, I’m sure if I were a better writer there would have been much less.

Bullet point boil down before reading the original post:

Point 1 - Last Week Ford significantly changed the production order of Broncos (see attachment shared only with dealers).

Point 2 - Yesterday Ford revised their end consumer Q&A “Will reservations be fulfilled in the order placed?”. They either did not tell us about the Point 1 change, or they did it in a way that no one would understand. The change significantly impacts production order for some customers.

Point 3: What does it mean to me?
If you do not have a early reservation, you may not receive your Bronco in rough production order. Basically, if you order through a dealer that has outsize sales compared to their market/normal volumes they may not receive your Bronco on a timely basis. So dealership price & service are no longer the only metrics to consider.

Point 4: Ford should share this information with us and they haven’t.

On to the original post:

Ford is using full transparency in explaining they have changed the way production will be allocated by inserting the incredibly descriptive term “residency” in the new FAQ.

For those that don’t know, Ford has added a dealer allocation formula to how Bronco production will be distributed. This means Ford lied in the original FAQ when they said reservations will be fulfilled in approximately the same order as received. Ford presumably did this at the behest of large dealers who were unhappy with the large # of orders going to smaller deep discounting dealers. So now, some Broncos will be fulfilled in rough reservation order but many will not.

Also note - Ford has removed their promise of all reservations being satisfied before dealer stock is built!

Unbelievable - what slimeball moves.

Original Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, based on final ordering and production of similarly configured Broncos. All reservations will be completed before production of stock units begins.

New Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, however, actual delivery may vary based upon a number of factors including vehicle model and configuration selected, commodity constraints, residency, delivery, and final ordering and production of similarly configured Broncos.

Edit:

To add the new dealer allocation formula. This is what changes how Bronco orders are fulfilled (and should be reflected in the new QA). Some people are going to be completely screwed by this and not know it’s coming (as evidenced by the discussion in this thread - let alone customers who don’t frequent forums).

Another Edit:
I know this won’t help - but if you got this far and you think this post (and by extension Ford’s allocation change) has something to do with 1) efficiency in production; 2) shipping efficiency to dealers; or 3) exact order of reservations; you’ve misread, so try some of the other explanatory posts by others below.

Actually Ford's website has said that about "residency" in the reservation FAQ's since the reservation bank opened, just fyi. Always read the fine print.

 

[Bimmerxi]

Bullet point boil down before reading the original post:

Point 1 - Last Week Ford significantly changed the production order of Broncos (see attachment shared only with dealers).

Point 2 - Yesterday Ford revised their end consumer Q&A “Will reservations be fulfilled in the order placed?”. They either did not tell us about the Point 1 change, or they did it in a way that no one would understand. The change significantly impacts production order for some customers.

Point 3: What does it mean to me?
If you do not have a early reservation, you may not receive your Bronco in rough production order. Basically, if you order through a dealer that has outsize sales compared to their market/normal volumes they may not receive your Bronco on a timely basis. So dealership price & service are no longer the only metrics to consider.

Point 4: Ford should share this information with us and they haven’t.

On to the original post:

Ford is using full transparency in explaining they have changed the way production will be allocated by inserting the incredibly descriptive term “residency” in the new FAQ.

For those that don’t know, Ford has added a dealer allocation formula to how Bronco production will be distributed. This means Ford lied in the original FAQ when they said reservations will be fulfilled in approximately the same order as received. Ford presumably did this at the behest of large dealers who were unhappy with the large # of orders going to smaller deep discounting dealers. So now, some Broncos will be fulfilled in rough reservation order but many will not.

Also note - Ford has removed their promise of all reservations being satisfied before dealer stock is built!

Unbelievable - what slimeball moves.

Original Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, based on final ordering and production of similarly configured Broncos. All reservations will be completed before production of stock units begins.

New Q&A
Will reservations be fulfilled in the order placed?

Reservations will be fulfilled in approximately the same order received, however, actual delivery may vary based upon a number of factors including vehicle model and configuration selected, commodity constraints, residency, delivery, and final ordering and production of similarly configured Broncos.

Edit:

To add the new dealer allocation formula. This is what changes how Bronco orders are fulfilled (and should be reflected in the new QA). Some people are going to be completely screwed by this and not know it’s coming (as evidenced by the discussion in this thread - let alone customers who don’t frequent forums).

OK I’m going to try to remain positive and say first of all I think Ford is making a huge mistake because they are looking at this purely profit to large dealers and not satisfying their customers, specially those early adopters. But on a positive note for those that still want a bronco in 2021 there will be significantly more reservations that are canceled and not fulfilled moving everyone who sticks it out up in line, I’m sure everyone that reserved before September 18 will receive their bronco before fall next year. And I bet everyone that reserved on the first day will still get theirs by summer.

 

[toystwo]

I’m sure everyone that reserved before September 18 will receive their bronco before fall next year

Hope your right about that. We will know more when Ford communicates allocation to the dealers and the good ones (like Granger) reach out to those that appear to fall outside of that dealers 2021 allocation. Of course even then, it is far from an exact science given no one knows the reservation to order conversion ratio.

Large dealers are probably the single most important constituency within Ford. Maybe tied with UAW.

 

[jdogi]

OK I’m going to try to remain positive and say first of all I think Ford is making a huge mistake because they are looking at this purely profit to large dealers and not satisfying their customers, specially those early adopters. But on a positive note for those that still want a bronco in 2021 there will be significantly more reservations that are canceled and not fulfilled moving everyone who sticks it out up in line, I’m sure everyone that reserved before September 18 will receive their bronco before fall next year. And I bet everyone that reserved on the first day will still get theirs by summer.

I'm not 100% sure about the statement above that I bolded. However you will probably be allowed to move your reservation again to another dealer where you can get your MY21.

My reservation has been with a big-ish local dealer from the start. And I'm sticking there regardless. But that doesn't change the fact that Ford underestimated demand "bigly". All of MY21 production vanished in a blink. Then some smaller dealers came in with compelling offers drawing a bunch of reservations away from the bigger dealers. Those dealers said "WTF?" and Ford "clarified" (AKA, they changed their plans). Ford, apparently, didn't foresee this. But I do recall some on this board saying that this was going to be an issue and that changes would come.

As stated, I'm not particularly bothered, but I can definitely understand why some are. On an aggregate level, this reduces our leverage as the end consumers and increases the dealer's profits and average selling prices. But to me, it is what it is.

I maintain that Ford will need to figure out how to deal with the whole dealership model if they're going to survive in the long run, but I guess today isn't the day.

My interest in this thread was solely to understand what the big fuss was about. I do believe that the facts are pretty compelling and indicate that my summary above is a relatively accurate assessment. I can understand all of the parties' interests here and I cannot really judge the actions of any of them. They've all done what serve's their interests. No different than what the smaller rural dealers did. No different than the buyers who placed their reservations with those dealers. Nobody in this equation is a charity. None are your friend.

I'm sure that Ford would do it a bit differently if they could start all over again.

 

[bloominguez]

Okay dude, there are more reservations that will be converted to orders than there will be MY2021 Broncos. Here is an example that someone else did, which may help you understand:

• 50% of reservations will be fulfilled based on a calculation using the dealers number of bronco reservations prior to Sep 18th that are converted to orders
• 25% of reservations will be fulfilled based on a calculation using the dealers sales volume
• 25% of the reservations will be fulfilled based on a calculation using the sales of jeeps/4Runners in market

Example
Dealer A is high volume and in huge jeep market
Dealer B is a low volume dealer

Dealer A gets 100 reservations (converted to orders) and Dealer B also gets 100. They are thus the same in that part of the formula, and are allocated 50 each for that. The rest is not the same:

- Dealer A may be able to get 50 + 22 + 20 , ie be allocated 92 broncos from the production line
- Dealer B may be able to get 50 + 2 + 1 , ie be allocated 53 broncos from the production line

Dealer A got the extra 22+20 because they did well in part 2 and 3 of the formula. Dealer B only got 3 extra, because they are rural and didn't score well at all in that part of the formula. Get it now?

Now Dealer A fills 92% of their orders; Dealer B fills 53%.

Good explanation, but even if true the final line isn't necessarily true. I don't think you're being pessimistic enough. I'm not sure dealers will be compelled to use their allocations to fulfill orders first.

IF Ford built Broncos to fulfill all reservations first, and used that information as part of the subsequent allocation formula, then the small dealers with aggressive discounts would see their strategy pay off. They would get more dealer stock Broncos than they otherwise would have, at the same (later) time as the big dealers. But, as has been pointed out in this thread, Ford doesn't want to piss off their large dealers, so that's not how Broncos will be allocated.

The large dealer, allocated 92 Broncos (in your example), may choose to fulfill 50 reservations and sell the remaining 42 at MSRP or higher. This would then let Ford say, hey, we're fulfilling reservations roughly in order (50 from each dealer, in your example).

The small, aggressive dealers probably only decided to be so aggressive because they thought they'd get greater allocations once all reservations had been filled. But now they have a choice to make. Allocate 50 Broncos to reservation holders and sell only 3 at MSRP from dealer stock? Hmm, that doesn't sound like what they signed up for. Remember, they are probably only being so aggressive in order to get more dealer stock than they otherwise would have, and now that won't happen for a while.

Something's gotta give. Either the small dealers do a lot of work to move more Broncos for very little profit and don't get properly rewarded for that work, or reservation holders at small dealerships won't get their Broncos as quickly as they should.

 

[toystwo]

The large dealer, allocated 92 Broncos (in your example), may choose to fulfill 50 reservations and sell the remaining 42 at MSRP or higher. This would then let Ford say, hey, we're fulfilling reservations roughly in order (50 from each dealer, in your example).

Currently, according to the dealers here, Ford rules prevent a dealer (large or small) from doing anything like that. My confidence in Ford being at a low ebb, we will see how that works out.

 

[rjkmoto]

Look again - I presume the “numbers“ you are referring to are the %’s. 50% of an individual dealer’s allocation is the dealer reservations thru 9/18 and 50% is a weighting of the competitive vehicle sales and his sales of other Ford product.

There are a couple of examples in this thread where people have plugged in hypothetical #’s for hypothetical dealers if you’re interested.

Hypothetical numbers put together in hypothetical formulas are STILL NOT the actual formula.

Telling someone 2 and 5 is in the equation is not the same as saying the equation IS, “2 x 5 = ?” vs “2 x y5 = ?” and then randomly picking “2 x y5 = y10” is not proof your speculation is correct.

That is circular logic ...

It’s STILL all speculation at this point. ?‍

JK

 

[Deleted member 2346]

My take:
Broncos will be produced reasonably in the order of reservations (some batching for efficiency and parts) but “delivery” will be based on location (effectively waiting on enough units going to that dealer or area before it ships.

The dealer allocation formula is where I get confused (the attachment in the OP). Is it saying that if a dealer has 100 reservations (dated prior to the cutoff date of course), that dealer guaranteed 50 of those (50%) but getting the other 50% depends on whether the dealer’s sales warrant getting allocated those???

If so, I Sure hope Granger has a favorable formula to support the explosion in sales it will see due to the bronco lol... for the sake of all the people out there that switched to them.

 

[nminus1]

All this drama is too much. That Ford would build similar/same models in the same batches/production runs, etc makes sense if true. If I was on the assembly line building a 2 DR base, then the next is FE, the next another model, a 2 door, then a 4 door etc makes no sense.
Or making a batch of Sasquatches all together by model. A run of 2 door bases, Then 4 doors, Then a batch of the next model, 2 door. then 4 door. Repeatability and consistentcy would seem to speed production and reduce errors. JMO. I can wait a few more weeks to make sure my Bronco is perfect.

 

[Bronc-O]

All this drama is too much. That Ford would build similar/same models in the same batches/production runs, etc makes sense if true. If I was on the assembly line building a 2 DR base, then the next is FE, the next another model, a 2 door, then a 4 door etc makes no sense.
Or making a batch of Sasquatches all together by model. A run of 2 door bases, Then 4 doors, Then a batch of the next model, 2 door. then 4 door. Repeatability and consistentcy would seem to speed production and reduce errors. JMO. I can wait a few more weeks to make sure my Bronco is perfect.

That's not how it usually works. The line builds whatever comes their way. Look at some of the plant photos and you'll also see Rangers coming down the same line.

 

[toystwo]

It’s STILL all speculation at this point

If you don’t see how that formula completely screws small dealers with a large number of orders (and many of their customers) because you don’t have the exact numbers to plug into the equation (which will never be available to consumers) then you don’t understand how the formula works.

And even if you can’t understand the formula, you can see the result — TX Vol Dealer stops promoting the deal, Granger has posted they are buying Ford product from other dealers to try and get their back half of the calculation increased.

Ford made this change to prevent small, deep discounting dealers from selling large numbers of Broncos that were being “taken” from large dealers (because the large dealers don‘t want to compete on price).

To say it’s all speculation because you don’t have the specific numbers for 4,000+ Ford dealerships is just burying your head in the sand.

I’ll also bet you have an early reservation.

 

[toystwo]

If so, I Sure hope Granger has a favorable formula to support the explosion in sales it will see due to the bronco lol... for the sake of all the people out there that switched to them.

By definition no small dealer has a favorable back half of the calculation. Which shouldn’t be a problem for dealers that are selling Broncos commensurate with their size/normal volume. It only becomes an issue when the dealer is selling a high volume of Broncos.

 

[Bronc-O]

If you don’t see how that formula completely screws small dealers with a large number of orders (and many of their customers) because you don’t have the exact numbers to plug into the equation (which will never be available to consumers) then you don’t understand how the formula works.

And even if you can’t understand the formula, you can see the result — Tx Vol Dealer stops promoting the deal, Granger has posted they are buying Ford product from other dealers to try and get their back half of the calculation increased.

Ford made this change to prevent small, deep discounting dealers from selling large numbers of Broncos that were being “taken” from large dealers (because the large dealers don‘t want to compete on price).

To say it’s all speculation because you don’t have the specific numbers for 4,000+ Ford dealerships is just burying your head in the sand.

I’ll also bet you have an early reservation.

Finally, written so it's understandable.

 

[toystwo]

It's not reading comprehension people just don't agree with your interpretation.

On almost every page of this thread someone brings up production efficiency. On the page where I posted the reading comprehension comment, is was brought up twice (one of which was you). Production/shipping efficiencies have nothing to do with this discussion - as has been repeatedly pointed out.

Ford was always going to produce and ship in an efficient manner - and they have disclosed that. That concept has not changed between the old and the new Q&A.

Disagree with me all you want on the substance of my original post, but it has nothing to do with production efficiency, so please stop cluttering the thread with that kind of post.

Not understanding that after reading the first post in this thread is a reading comprehension problem.

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