Ford cancels Model e Dealer Program, letting all US retailers sell EVs

[Jimrpa]

Agree that the "per-vehicle" reporting we often hear is misleading. But ultimately it is X amount spent annually minus X amount of revenue from annual sales. And if they're coming up short by $billions/year now in the 4th year of the Mach-E line (and I think 3rd on Lightning and eTransit), it's a problem.

It is hard to know how much of the money spent is for future ventures though, like Blue Oval City. But the fact that Ford has scaled back/delayed many of their EV plans suggests that's only part of it, and they really are far from true profitability on the Gen1 lines. Whatever the per-vehicle number, it must not be close enough to just keep on track with minor tweaks.

It’s actually a bit more complex than that. Ford does not report operational expenses for individual plants (a plant may have more than one line, usually making slightly different vehicles), so you’d need to have inside information to know how say, Cuatalin, is doing. Second, Ford, like all companies, loves to toss around HUGE numbers when building a new plant. There’s no better way to ingratiate yourself with various political types than to say “Hey, we’re opening a new $10B facility in your city/district.” Remember the feeding frenzy around Amazon HQ2? In the case of Blue Oval city, I believe there is at least one partner (a battery partner? I forget) so when Ford says “TEN BILLION DOLLARS!!!” That’s not all coming from change Bill dug out of his sofa.
All that said, everyone misjudged how the US EV market would grow, so now they’re retrenching and chasing after the hybrid market.

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[dbsb3233]

It’s actually a bit more complex than that. Ford does not report operational expenses for individual plants (a plant may have more than one line, usually making slightly different vehicles), so you’d need to have inside information to know how say, Cuatalin, is doing. Second, Ford, like all companies, loves to toss around HUGE numbers when building a new plant. There’s no better way to ingratiate yourself with various political types than to say “Hey, we’re opening a new $10B facility in your city/district.” Remember the feeding frenzy around Amazon HQ2? In the case of Blue Oval city, I believe there is at least one partner (a battery partner? I forget) so when Ford says “TEN BILLION DOLLARS!!!” That’s not all coming from change Bill dug out of his sofa.
All that said, everyone misjudged how the US EV market would grow, so now they’re retrenching and chasing after the hybrid market.

It all come down to costs. The EV market would be doing much better if vehicles like the Mach-E cost like $30k to make and had $35k MSRPs.

But instead it costs like $65k to make and sells for $55k (I made those numbers up, but you get the point). Thus the problem for both Ford and the whole EV market. Way too expensive to make.

 

[Sikkun]

I know we are on EV doom and gloom. But wasn’t all auto sales dropping for a couple years there?

Have a feeling 7% auto loans don’t drive sales.

 

[dbsb3233]

I know we are on EV doom and gloom. But wasn’t all auto sales dropping for a couple years there?

Have a feeling 7% auto loans don’t drive sales.

Yes, high interest rates hurt auto sales in general. But they hurt $55k cars more than they hurt $35k cars. In fact they drive many would-be $55k buyers down to cheaper models.

And when EVs are mostly in the $55k area, it hurts them more. Someone that might have considered a Mach-e ends up buying an Escape instead when money is tighter (for instance).

 

[Arsenic17]

The dealer model is going to make EV sales through them difficult. Much of their profit comes from servicing vehicles they sell. We all know EV service and maintenance costs are substantially lower than ICE. Profit margins at the point of sale are already lower on EV. Why would a dealer want to sell them when years down the road that customer won't be coming back for much service either?

I see a future where EV sales may be online only with dealers only participating by doing the delivery to the customer for a flat fee per car paid by Ford.

 

[MachEnthusiast]

Unfortunately the issue I've run into is not that I can't find a Ford dealer that will service EVs. I'm having trouble finding one that has any idea how they work without calling me and asking me - which is actual insanity.

 

[Jerrytball]

The dealer model is going to make EV sales through them difficult. Much of their profit comes from servicing vehicles they sell. We all know EV service and maintenance costs are substantially lower than ICE. Profit margins at the point of sale are already lower on EV. Why would a dealer want to sell them when years down the road that customer won't be coming back for much service either?

I see a future where EV sales may be online only with dealers only participating by doing the delivery to the customer for a flat fee per car paid by Ford.

I know this is a little bit of an older thread, but it’s just funny. I bought me a 2012 convertible Mustang the other day and I drove it down to where I bought my electric mustang. I was talking to the sales guys who were hardly have any customers on a beautiful Saturday, and cruising the coast down here of 10,000 hot rods down here from all over the country. That happens every October. But the amount of cars on the lot, the cheapest one was a 2019 Eco port, 60,000 miles, $13,000! I said, do you have any lightnings orMach e’s? no, they don’t want any. They’re not gonna order you one and if you need the service, I need to take it to the other dealer 20 miles from them who I’ve been using and I did use in the past, I’ve always used them for everything in my car, but I’ve never bought a car from the other dealer so the way they support me has definitely earned my respect, I mean, they treat me like a customer that bought many cars from them. It’s probably because they’ve never really had a big inventory. They’re not a huge dealer and the prices are a little high so I kind of stayed away from them. The Ford dealer I bought my car from. He owns several other car dealerships in the area so I guess being that large he can do a little bit more with pricing, but cars are just not selling. They’re thinking that this may change they’re hoping, after the election. But for them to sell another electric vehicle, they’re not even gonna take an order, matter fact somebody came in there and put $1000 down ordering an $80,000 dark horse got the car and decided they didn’t want it so now they got that on the lot with custom paint job that you’re trying to move. Of course that person lost their thousand dollar down payment which you have to always agree to when you order a car through them.

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