Ford Motor Company announced plans to streamline its growing EV business in March by separating operations into distinct units. Conventional ICE vehicles will fall under “Ford Blue,” while electric cars will make up “Ford Model e.” However, recent commentary from Ford CEO Jim Farley has raised serious concerns from some franchised car dealers.
While speaking at the 2022 Alliance Bernstein Strategic Decisions Conference, Farley stated, “We got to go to non-negotiated price, we got to go to 100% online. The vehicle, there’s no inventory, goes directly to the customer, 100% remote pickup and delivery. But then we have this opportunity to use our physical presence to outperform [competitors].”
Farley’s comments indicate that Ford will continue shifting toward online sales and fixed pricing, which has been expected for some time. Still, his statements reveal that the automaker intends to use its dealer network as a competitive advantage over competitors like Tesla and Rivian, which only sell direct and have no physical dealerships.
Now, Ford dealers are being encouraged to specialize in either electric vehicles for “Ford Model e” or ICE vehicles for “Ford Blue” as soon as 2023. The upcoming reorganization might also compel dealers to sell EVs at fixed rates with no physical inventory in scaled-down facilities in the future.
Joining us on Inside Automotive to discuss Farley’s bold declarations and the potential impact dealers face is auto industry expert Mike Maroone, the CEO of Mike Maroone Auto, former President and COO of AutoNation.