Ford gives dealers 2 months to accept new rules or stop selling EVs.

[JohnFoxeSheets]

Agreed. As always in the US the mantra is "make money now, and worry about the future when we get there". On @Kamuelaflyer's island and in many other regions with lower population density it's a no-brainer to stick with ICE sales, service, and maintenance: that's where the money is. BEV's have much lower potential for aftermarket service, and now Ford is making sure they make less on the front-end as well. If and when ICE are really end-of-life'd from a new car sales perspective they'll still make money on used car sales and service - and can worry about getting in the BEV game then.

There's also the political aspect: BEV's are now being turned into a red/blue issue so those red states will never ban ICE - so there will be plenty of sales for an ICE-only dealer for decades to come.

While the Big Island of Hawaii is certain rural (the island is more than twice the area of all the other Hawaiian islands combined and it's population is only about 200K), gas in Hawaii is very expensive and solar electricity make tons of sense given the amount of sunlight and lower latitude than the rest of the US that lessens seasonal solar exposure variability. So it's a tougher nut to crack for dealerships. As Bill noted, there are lots of BEVs in Hawaii and that number will only go northward...

But yeah, this is specific to Hawaii (and Puerto Rico, I suppose).

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[tannerk89]

Agreed. As always in the US the mantra is "make money now, and worry about the future when we get there". On @Kamuelaflyer's island and in many other regions with lower population density it's a no-brainer to stick with ICE sales, service, and maintenance: that's where the money is. BEV's have much lower potential for aftermarket service, and now Ford is making sure they make less on the front-end as well. If and when ICE are really end-of-life'd from a new car sales perspective they'll still make money on used car sales and service - and can worry about getting in the BEV game then.

There's also the political aspect: BEV's are now being turned into a red/blue issue so those red states will never ban ICE - so there will be plenty of sales for an ICE-only dealer for decades to come.

I think it will be interesting to see the annual report from Ford Blue and Ford Model E a few years down the road to see if this generalization that ICE makes more money than EVs holds water.

I also think the lack of service visits is why the dealership model no longer makes sense for an EV company. This may just be the first steps to phasing out dealerships for Ford Model E. Make barriers to entry really high, then show rooms with direct online sales and service centers may start popping up instead of dealers.

 

[dbsb3233]

I think it will be interesting to see the annual report from Ford Blue and Ford Model E a few years down the road to see if this generalization that ICE makes more money than EVs holds water.

I also think the lack of service visits is why the dealership model no longer makes sense for an EV company. This may just be the first steps to phasing out dealerships for Ford Model E. Make barriers to entry really high, then show rooms with direct online sales and service centers may start popping up instead of dealers.

I think he meant makes more money for dealerships, not for Ford.

It's a whole different matter for the manufacturers.

 

[timbop]

I think he meant makes more money for dealerships, not for Ford.

It's a whole different matter for the manufacturers.

Correct! A significant portion of a dealership's revenue is service; BEV's don't need oil changes, transmission servicing, etc. They still have parts that wear out, but overall will require fewer trips to a mechanic over their lifetime.

Ford is clearly leaning toward ongoing revenue from car owners, but things like software subscriptions for bluecruise will be direct revenue for Ford with nothing for the dealer.

 

[timbop]

Make barriers to entry really high, then show rooms with direct online sales and service centers may start popping up instead of dealers.

How exactly does is that make more financial sense than giving an existing dealership a slice of the pie? How will those showrooms be paid for? Is Ford supposed to dump billions into making showrooms, training representatives to show the demo models, and then separately create a network of service centers for warranty work? The logistics of that are staggering, which is why Tesla has 4 service centers in the most densely populated state in the US.

If the idea is independent showroom and service center owners, how is that different from a dealership?

 

[tannerk89]

How exactly does is that make more financial sense than giving an existing dealership a slice of the pie? How will those showrooms be paid for? Is Ford supposed to dump billions into making showrooms, training representatives to show the demo models, and then separately create a network of service centers for warranty work? The logistics of that are staggering, which is why Tesla has 4 service centers in the most densely populated state in the US.

If the idea is independent showroom and service center owners, how is that different from a dealership?

I wouldn’t say it’s my idea. But it’s the business model EV startups are using that are disrupting the auto industry which is what Ford Model-E has been molding itself after, right or wrong.

 

[bp99]

I wouldn’t say it’s my idea. But it’s the business model EV startups are using that are disrupting the auto industry which is what Ford Model-E has been molding itself after, right or wrong.

Ford is jealous of the control and margins Tesla has. They're being very shortsighted, however. What Tesla does not require at this point in time is scale. They have limited production capacity compared to Ford and nearly all their customers are in larger metro areas. They also only have a fleet that's about ten years old to service.

Having a small scattering of delivery/service centers works at Tesla's current scale. It will become a pain point as they both grow and the size of their existing fleet of cars on the road increases. Like it or not, the franchise dealer model provides large scale much more efficiently than growing that footprint from corporate. You have to share some of the revenue per car sold, but total revenue is greater with the much larger volume the dealerships easily allow you to scale to. The concern should be more about getting rid of the sketchy dealers that give the brand a bad rep.

 

[dbsb3233]

I wouldn’t say it’s my idea. But it’s the business model EV startups are using that are disrupting the auto industry which is what Ford Model-E has been molding itself after, right or wrong.

It may not matter that much who's doing the service and displaying show models (Ford directly or dealerships), the main issue is the volume of it. When there's 50% less demand for service and sales people, it could just mean 50% fewer dealerships (or they'll be 50% smaller, or some combo thereof).

 

[atomdeathstroke]

I researched installing dcfc at my manufacturing facility where I already bring in 480, 208,240 3 phase. I’m also across the street from a power relay station.

the cost to these dealerships is probably going to be 100,000$ for a 62.5kwh charger. Not to mention all the issues they will have with their local power company having grid issues and staff shortages to even install them.

im all for having dealers install them, but Ford is going to have very little compliance with this plan for the next 2-3 years.

I also forgot to mention that install/ turn around time for the charger itself was 5 months out (this was in July) and my local power company said… “8–12 months” to install another service at my plant.

 

[DennisD]

I just sold my GT to Carvana, used, 5000 miles, they sold it $10k above MSRP in 4 days, whoever bought that car, could've walked into any dealer and paid that ADM the dealer was asking and the car would cost him less, they not only paid $10k above, they lost $7500 Federal, 750 clean air board resource and 2000 from California, a total of $10750 on top of that $10000 above MSRP, on a used vehicle!

Carmax is doing the exact same thing, my cousin just got a GT for $5k above MSRP, brand new delivery miles only! who you think was fair? that "Stealership" or Carmax/Carvana?

It is all perception. If some people are purchasing MME's for MSRP at Dealerships while others are paying 10K ADM from a similar Dealership (Ford Name on the marquee) if you will, the one that charged 10K ADM for the exact same car will be viewed as a "Stealership".

Now I realize that there are many foolish people IMO paying these high rates, it still doesn't erase the perception that there are many Dealerships that will take advantage of the supply and demand issue while there are others that won't "go there".

The difference between selling something new and selling something used are two totally different things. Most likely, Carvana and the like paid a premium on todays market and they will need to charge a premium to stay competitive. Ford Dealers on the other hand, were offered the car from Ford at a discounted price, thus giving them the mantra of "Stealership".

So to answer your question, Carmax/Carvana

 

[MachE Mach]

If the dealers do not opt in now, they will not have the option again until 2025. So they can opt out and then weigh the cost in a few years vs the demand in their region.

https://insideevs.com/news/610114/ford-modele-dealership-rules/

 

[dbsb3233]

If the dealers do not opt in now, they will not have the option again until 2025. So they can opt out and then weigh the cost in a few years vs the demand in their region.

https://insideevs.com/news/610114/ford-modele-dealership-rules/

What's next, requiring that they cure cancer too? ?

It's looking more and more like Farley WANTS dealerships to drop out. Which was probably the plan all along... to copy Tesla. Sounding more and more Tesla-obsessed by the day.

 

[dtbaker61]

At a minimum, Model E Elite dealers will need to install two high-powered DC fast chargers and a level 2 charging station, as well as offer at least one DC fast charger available for the public to use...Model E Certified dealers are only required to install one DC fast charger, and it must be made available for public use.

This won't help in many cities where dealers are located and infrastructure is already going in but will be a big improvement to charging infrastructure in rural areas.

I hope Ford adds up-time requirements on those chargers.

I am guessing that uptime requirements will be set by whoever actually owns and is trying to pay off the DCFC charge stations. I'd be more interested in whether Ford is trying to set cap prices on the charge cost to consumers.... and how they are going to make the 'public' charger public when many dealerships have gated lots with no access after normal work hours.

Federal Interstates have a pretty nice program in place (NEVI) that should result in charge stations going in of the next 18 months.... but Ford Dealerships in rural Southwest are few and far between.

For instance, Northern New Mexico has NO L3 DCFC stations north of Santa Fe, and only a few L2, mostly around Espanola and Taos.

There are no Ford dealerships until you look way up at the CO border, in Raton, or way over in the NW corner..... which leaves a huge gap in the top third of the state, which makes a day-trip from Santa Fe to a recreational area like Heron Lake a pretty risky venture in a standard range BEV with 200-ish mile range.

 

[dbsb3233]

I am guessing that uptime requirements will be set by whoever actually owns and is trying to pay off the DCFC charge stations. I'd be more interested in whether Ford is trying to set cap prices on the charge cost to consumers.... and how they are going to make the 'public' charger public when many dealerships have gated lots with no access after normal work hours.

Federal Interstates have a pretty nice program in place (NEVI) that should result in charge stations going in of the next 18 months.... but Ford Dealerships in rural Southwest are few and far between.

For instance, Northern New Mexico has NO L3 DCFC stations north of Santa Fe, and only a few L2, mostly around Espanola and Taos.

There are no Ford dealerships until you look way up at the CO border, in Raton, or way over in the NW corner..... which leaves a huge gap in the top third of the state, which makes a day-trip from Santa Fe to a recreational area like Heron Lake a pretty risky venture in a standard range BEV with 200-ish mile range.

This whole "Ford requiring dealerships to install DCFC" thing doesn't make much sense to me unless Ford is paying for it. There's almost no benefit to the dealer. Foot traffic is not what sells cars, like it does candy bars and Slurpees. For dealers this will just be cost and annoyance.

It makes slightly more sense if Ford is just using dealership real estate to build their own mini BOCN network though (although only slightly). Maybe Ford plans to reimburse dealers for the high cost?

 

[brancky3]

Ford is jealous of the control and margins Tesla has. They're being very shortsighted, however. What Tesla does not require at this point in time is scale. They have limited production capacity compared to Ford and nearly all their customers are in larger metro areas. They also only have a fleet that's about ten years old to service.

Having a small scattering of delivery/service centers works at Tesla's current scale. It will become a pain point as they both grow and the size of their existing fleet of cars on the road increases. Like it or not, the franchise dealer model provides large scale much more efficiently than growing that footprint from corporate. You have to share some of the revenue per car sold, but total revenue is greater with the much larger volume the dealerships easily allow you to scale to. The concern should be more about getting rid of the sketchy dealers that give the brand a bad rep.

Ford should have taken a note from Volvo and released another brand so they can sell direct to consumers, but still allow Ford dealers to work on the vehicles. That would have solved all problems you just outlined.

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