Dealers are either all in on electrification or they're going to be left out.

ford gives dealers six weeks to decide if they want to continue selling evs

In what will certainly be met with resistance from many of its franchises, Ford dropped a bomb at its annual dealership meetings in Las Vegas this week. InsideEVs was one of only a handful of news outlets invited to get an early look at the new Model e dealership rules including a presentation from none other than Ford CEO, Jim Farley.

In short, Ford is telling its dealer network they have to invest, evolve, improve, and offer new services if they want to be a Model e dealership and sell electric vehicles. Model e is a new division of Ford that was recently created when Ford split the company into three arms; Ford Blue Oval, Ford Pro, and Ford Model e. All of Ford’s fully electric vehicles now fall under the Model e umbrella. Plug-in hybrids and regular hybrids are part of Ford Blue Oval.

ford gives dealers six weeks to decide if they want to continue selling evs

Ford’s current three BEV offerings from left: Ford F-150 Lightning, Ford E-Transit and Ford Mustang Mach-E

Farely talked a lot about Tesla, and how the startup electric vehicle manufacturer has roughly a $2,000 price advantage over Ford. He said that Ford and its dealers need to, and have been, working to narrow that gap.

He explained how he believes that as Tesla scales up, it will be forced to change how it does business and its operations will begin to look more like traditional dealer networks. In fact, he’s already seeing that in Tesla’s operations in Norway.

With that, he also believes that Ford needs to change the way it sells electric vehicles, and the first major steps to that transformation are happening now.

Three Options

Ford is giving its dealers until October 31st of this year – less than two months, to make a decision that will have huge implications for the future of the franchise. The company is offering its dealers three options:

  • Become a Model e Certified Elite dealership
  • Become a Model e Certified dealership
  • Discontinue selling Model e vehicles effective January 1st, 2024.

Amongst other things, Model e Elite dealers will need to install a minimum of two high-powered DC fast chargers as well as level 2 charging stations and have at least one DC fast charger available for the public to use. Ford estimates the all-in cost for dealers to become Model e certified elite to be between $1 and $1.2 million, with as much as 90% of the cost attributed to the cost to purchase and install the required charging infrastructure.

Model e certified dealers are only required to install one DC fast charger, and it must be made available for public use. However, Model e certified dealers will have a hard cap on the number of EVs they are allowed to sell each year, and that number will be the same for all Model e certified shops, regardless of annual volume.

We were told that Ford hasn’t decided exactly what that number will be, but it will be small and intended to only satisfy orders for the dealer’s most loyal customers. Ford estimates the cost for dealers to become Model e certified to be about $500,000, again, with as much as 90% of the cost attributed to charging infrastructure.

We’ve been studying Tesla closely, especially with how their brand has scaled with units and operations in Norway and what we’ve noticed is that they have almost 1,200 employees now and they have very much dealer-like facilities and we think that’s the direction they’ll go as they scale their operations in the United States – Jim Farley, CEO, Ford Motor Company

And finally, dealers have the option of not becoming Model e certified. If they choose that route, they give up the right to sell any fully electric Ford vehicles for three years. At some point in 2025, they will have the opportunity to tell Ford that they wish to become a Model e certified or certified elite dealership, and provided they complete the requirements, they will be allowed to start selling EVs in January 2027.

If they do choose to opt out of becoming a Model e certified dealer now, there will be no opportunity of becoming one until 2027.

This first stage of Model e evolution will be in effect from January 1st, 2024 through December 31st, 2026. The decision the dealership makes now will be in effect through 2026 and dealers cannot change their Model e certification status until January 1st, 2027. All dealers will continue to be able to sell EVs until January 1st, 2024 when the new Model e rules begin.

ford gives dealers six weeks to decide if they want to continue selling evs

2022 Ford F-150 Lightning Towing

Five Pillars

Ford explains that its Model e dealership strategy will be built upon five pillars:

  • Training: Dealers will need to undergo extensive EV training on an ongoing basis
  • Charging: Model e dealers must have adequate level 2 and DC fast charging, with at least one DC fast charger available to the public
  • Set Pricing: Transparent, non-negotiable pricing available online
  • Excellent physical experience: Model e dealers must deliver an excellent ownership experience, including complimentary pickup and drop off for vehicle service visits
  • Develop digital experience: Invest in building a digital ownership experience for the future

No-Haggle Pricing, But It’s Not Direct Sales

When Ford announced the creation of Ford Model e, some speculated that one of the purposes may be to try to implement a hybrid version of a direct sales model in which customers would order their EVs directly from Ford but take delivery from a local dealer.

That won’t be the case. The dealer franchise laws are very clear, and Ford cannot sell vehicles to consumers directly even if they wanted to. The only reason EV upstarts like Tesla, Rivian, and Lucid are able to (and even these companies are banned from selling vehicles in some states) is because they don’t have an existing network of dealerships, as Ford does.

But Ford believes its dealer network is a strength, not a weakness, they just need to improve the sales process and customer experience with electric vehicles, and that’s exactly what Model e aims to do.

The new rules for Model e dealerships require dealers to post set prices for the electric vehicles online at Ford.com. Customers can view the set pricing, complete the purchase online, and even schedule home delivery. But ultimately, it’s the dealer’s decision what the set pricing will be for the vehicles, and there will likely be price variation from dealer to dealer. Customers will be able to cross-shop different local dealers’ prices online, and then choose the one with the lowest set price. The dealers must honor the set pricing for every purchase, and Ford will be checking the purchase orders to make sure that happens.

This new system gives the customer the option of doing everything online and completely eliminates the need to visit the dealership. Of course, if the customer prefers to visit the dealership, kick the tires and complete the purchase agreement in person, they are still welcome to do so. However, it will be for the same price they could have purchased it online from the Ford.com website, the dealers cannot change the price once it’s set.

ford gives dealers six weeks to decide if they want to continue selling evs

Ford DC fast chargers

Charging Is Key

A huge (and most expensive) part of the Model e certification is the requirement for dealers to provide DC fast chargers with a minimum output of 120 kW. The chargers must be readily accessible on the property and available to the public. This requirement was born from the fact that Ford knows that a major pain point for consumers transitioning to EVs is the concern over fast charging availability, especially for those that live in apartments and cannot charge at home.

Dealers will be able to tell customers that whenever they need to charge, wherever they are, they can find a Ford dealership nearby where they can plug in. That’s because Ford currently has 2,991 dealerships in the US and 96% of Americans live within 25 miles of a Ford dealership, and 85% live within 10 miles. So basically, you’re just about always close to a Ford dealer, and if they all install DC fast chargers, the Blue Oval Charging Network will have pins on the map just about everywhere.

ford gives dealers six weeks to decide if they want to continue selling evs

The service providers that will assist Ford’s dealers with EV charging infrastructure

Ford has also established relationships with three charging station installation providers; ABB, Entech, and AGI. These companies specialize in facilitating the installation of DC fast chargers, which can be quite complicated as well as expensive.

Depending on where the dealer is located, one of these companies will assist the dealer during the entire process, from filing the necessary permits to utility interconnection, to the actual installation of the stations and even making sure the dealer gets any available public funding available for EV charging infrastructure.

This is a very important component of the plan because installing high-powered DC fast chargers is a complicated process, one that most dealers will require assistance with. Ford also has programs in place to provide financing to its dealers for large capital improvements like this if the dealer needs financial assistance.

ford gives dealers six weeks to decide if they want to continue selling evs

Bold New Start

We think Model e’s new rules are a good start for the brand. Ford talked a good game at the meetings; everything was about building a better customer experience, offering the customer more options, evolving to meet a changing marketplace, everything we want to hear.

However, it will all come down to execution, it always does. What will be the uptake from dealers? How competitive will the new no-haggle set prices be? The dealers are the ones setting the prices, so what if they all set prices above MSRP? How reliable will Ford’s DC fast chargers be? Will Ford monitor the uptime of the units and force the dealers to quickly repair the chargers when they go offline?

There are still a lot of unknowns to this plan, but we give Ford credit for being the first existing OEM to attempt to improve its EV buying experience in such a significant way.

Keyword: Ford Gives Dealers Six Weeks To Decide If They Want To Continue Selling EVs

CAR'S NEWS RELATED

Here's How The Ford Ranger Raptor's Fox Shocks Make It A Great Off-Roader

There are multiple drive modes, and each one tweaks the dampers for different purpose.

View more: Here's How The Ford Ranger Raptor's Fox Shocks Make It A Great Off-Roader

Crawford moves to DAMS, Hadjar and Marti join Campos

Isack Hadjar (FRA) Red Bull Junior Driver. Formula 1 World Championship, Rd 17, Japanese Grand Prix, Thursday 21st September 2023. Suzuka, Japan. Jak Crawford will move to DAMS for the 2024 Formula 2 season while Red Bull juniors Isack Hadjar and Pepe Marti will compete for Campos. Crawford finished ...

View more: Crawford moves to DAMS, Hadjar and Marti join Campos

Ford Robbed Us Of The Old Four-Door Ranger Because It Wanted To Sell Explorers

Photo: Ford By definition, a big truck like a Ford F-150 or Chevy Silverado struggles to be small. Even in its smallest, most trucky configuration — a two-door single cab — a full-size truck is relatively large and comes with a sizable bed for hauling cargo. But a small ...

View more: Ford Robbed Us Of The Old Four-Door Ranger Because It Wanted To Sell Explorers

Ford loses nearly 400 participants from its EV dealer program

After asking its dealers to join it “on an epic journey of sustainable expansion,” Ford revealed over two-thirds of its dealers joined almost a year ago. However, close to 400 dealers have dropped out of the program since then. Ford asked its dealership network to become a part of ...

View more: Ford loses nearly 400 participants from its EV dealer program

Planned Three-Year Cruise Canceled At The Last Minute Because The Company Couldn't Afford To Buy A Ship

Image: GreenOak (Shutterstock) A cruise that was set to sail around the world for three years has been abruptly canceled at the last minute. The reason? The company behind the cruise couldn’t afford to buy a ship in time, as CNN reports. Life at Sea Cruises, a division of ...

View more: Planned Three-Year Cruise Canceled At The Last Minute Because The Company Couldn't Afford To Buy A Ship

Volkswagen Is Developing Affordable EVs, But Only For China

24 May 2023, Saxony, Zwickau: A model of the new-generation ID.3 is assembled at Volkswagen’s plant in Zwickau. Following the start of production in 2019, the vehicle has now received a facelift as part of the model mint. Image: Hendrik Schmidt/picture alliance (Getty Images) After Chinese automaker BYD dethroned ...

View more: Volkswagen Is Developing Affordable EVs, But Only For China

This 2024 Ford Mustang GT Only Survived 16 Miles Before Being Crashed

There's heavy damage on the rear of the car, but the 5.0-liter V8 is listed as still running.

View more: This 2024 Ford Mustang GT Only Survived 16 Miles Before Being Crashed

Let This Lancia Stratos Replica Be Your Affordable Key To Rally Greatness

This auction is a realistic way to have a street-legal rally icon parked in your driveway.

View more: Let This Lancia Stratos Replica Be Your Affordable Key To Rally Greatness

At $27,500, Is This 2008 Ford F450 Super Duty A Super Big Deal?

Can you tow with a Ford Everest Wildtrak?

1962 Ford Falcon | Old Car

Ford patents inflatable bumpers for its large SUVs & pickups

Ford Figo: Weird noise when the ignition is on worries me

Ford Taurus, Dodge Caravan Live Again In 1995 Detroit Auto Show Retro Video

Next-gen Ford Mustang – The competitors at R1.5 million

At $9,000, Would This 1976 Ford Granada Ghia Put You Back In Black?

2.0L Bi-Turbo or 3.0L V6 – The most popular engine for the Ford Ranger Wildtrak in South Africa

Ford Mustang GT3 Looks Fast, Sounds Like Thunder In Track Test Video

Road-Trip Review: 2023 Ford Everest 3.0 V6 4WD Platinum

Here’s How An Affordable Chinese-Made EV Holds Up After 100,000 Miles

OTHER CAR NEWS

; Top List in the World https://www.pinterest.com/newstopcar/pins/
Top Best Sushi Restaurants in SeoulTop Best Caribbean HoneymoonsTop Most Beautiful Islands in PeruTop Best Outdoor Grill BrandsTop Best Global Seafood RestaurantsTop Foods to Boost Your Immune SystemTop Best Foods to Fight HemorrhoidsTop Foods That Pack More Potassium Than a BananaTop Best Healthy Foods to Gain Weight FastTop Best Cosmetic Brands in the U.STop Best Destinations for Food Lovers in EuropeTop Best Foods High in Vitamin ATop Best Foods to Lower Your Blood SugarTop Best Things to Do in LouisianaTop Best Cities to Visit in New YorkTop Best Makeup Addresses In PennsylvaniaTop Reasons to Visit NorwayTop Most Beautiful Islands In The WorldTop Best Law Universities in the WorldTop Richest Sportsmen In The WorldTop Biggest Aquariums In The WorldTop Best Peruvian Restaurants In MiamiTop Best Road Trips From MiamiTop Best Places to Visit in MarylandTop Best Places to Visit in North CarolinaTop Best Electric Cars For KidsTop Best Swedish Brands in The USTop Best Skincare Brands in AmericaTop Best American Lipstick BrandsTop Michelin-starred Restaurants in MiamiTop Best Secluded Getaways From MiamiTop Best Things To Do On A Rainy Day In MiamiTop Most Instagrammable Places In MiamiTop Interesting Facts about FlorenceTop Facts About The First Roman Emperor - AugustusTop Best Japanese FoodsTop Most Beautiful Historical Sites in IsraelTop Best Places To Visit In Holy SeeTop Best Hawaiian IslandsTop Reasons to Visit PortugalTop Best Hotels In L.A. With Free Wi-FiTop Best Scenic Drives in MiamiTop Best Vegan Restaurants in BerlinTop Most Interesting Attractions In WalesTop Health Benefits of a Vegan DietTop Best Thai Restaurant in Las VegasTop Most Beautiful Forests in SwitzerlandTop Best Global Universities in GermanyTop Most Beautiful Lakes in GuyanaTop Best Things To Do in IdahoTop Things to Know Before Traveling to North MacedoniaTop Best German Sunglasses BrandsTop Highest Mountains In FranceTop Biggest Hydroelectric Plants in AmericaTop Best Spa Hotels in NYCTop The World's Scariest BridgeTop Largest Hotels In AmericaTop Most Famous Festivals in JordanTop Best European Restaurants in MunichTop Best Japanese Hiking Boot BrandsTop Best Universities in PolandTop Best Tips for Surfing the Web Safely and AnonymouslyTop Most Valuable Football Clubs in EuropeTop Highest Mountains In ColombiaTop Real-Life Characters of Texas RisingTop Best Beaches in GuatelamaTop Things About DR Congo You Should KnowTop Best Korean Reality & Variety ShowsTop Best RockstarsTop Most Beautiful Waterfalls in GermanyTop Best Fountain Pen Ink BrandsTop Best European Restaurants in ChicagoTop Best Fighter Jets in the WorldTop Best Three-Wheel MotorcyclesTop Most Beautiful Lakes in ManitobaTop Best Dive Sites in VenezuelaTop Best Websites For Art StudentsTop Best Japanese Instant Noodle BrandsTop Best Comedy Manhwa (Webtoons)Top Best Japanese Sunglasses BrandsTop Most Expensive Air Jordan SneakersTop Health Benefits of CucumberTop Famous Universities in SwedenTop Most Popular Films Starring Jo Jung-sukTop Interesting Facts about CougarsTop Best Hospitals for Hip Replacement in the USATop Most Expensive DefendersTop Health Benefits of GooseberriesTop Health Benefits of ParsnipsTop Best Foods and Drinks in LondonTop Health Benefits of Rosehip TeaTop Best Air Fryers for Low-fat CookingTop Most Asked Teacher Interview Questions with AnswersTop Best Shopping Malls in ZurichTop The Most Beautiful Botanical Gardens In L.A.Top Best Mexican Restaurants in Miami for Carb-loading rightTop Best Energy Companies in GermanyTop Best Garage HeatersTop Largest Banks in IrelandTop Leading Provider - Audit and Assurance In The USTop Best Jewelry Brands in IndiaTop Prettiest Streets in the UKTop Best Lakes to Visit in TunisiaTop Highest Mountains in Israel