The move – which is optional for US dealers – has ramifications for Australia with Ford franchise dealers potentially facing a similar request from the factory.

Part of the reason for the surprise by US dealers is based on comments by Ford CEO Jim Farley in February that he wanted online-only sales for EVs “with no dealer markups or other price negotiations,” as reported by the Detroit Free Press.

“We’ve got to go to a non-negotiated price. We’ve got to go 100 per cent online,” he said in the article which assumes a policy aligned to that of an agency retail model.

“There’s no inventory (at dealerships), it goes directly to the customer. And 100 per cent remote pickup and delivery.”

The shuffling of the game at Ford follows the company positioning EVs as one of three subsets of its products that dealers can sell.

James D. Farley, Jr.
President and CEO, Ford

Mr Farley last year created ‘Ford Pro’ as the commercial vehicle division. Then in March this year, Ford separated the company into ‘Ford Blue’ for the ICEs, and ‘Model e’ for EVs.

By promoting the idea of online sales, Ford’s proposal boasts it will mean dealerships will carry less stock. This should save money as Ford claims in the article that its current distribution model adds around $US2000 ($A2970) in extra costs per car compared to Tesla. It said that a third of that cost is tied up in inventory, and another third is spent on advertising.

“Our model is messed up. We spend $US600 ($A890) or $US700 ($A1040) on the vehicle to promote it, and we spend nothing post-warranty on the customer experience,” said Mr Farley.

“The problem is, on a parts business, which historically has been very profitable, we only get, maybe, only 10 or 20 per cent of the customers come back to us.”

Now Ford is demanding that dealers cough up to belong to the ‘Model e’ experience.

US dealers have a choice to invest in the EV future or, effectively, do nothing and stay with ICEs.

Ford dealers have until October 31 to choose one of two EV certification tiers that require different levels of investment in fast chargers and staff training. Those who opt out of both will be limited to selling ICE vehicles and hybrids.

Ford said that EV dealers must sell the products at non-negotiable prices and those who choose the lower-priced certification tier won’t be allowed to carry them in inventory, instead having customers order exactly what they want for later delivery.

Dealers who choose the highest tier — ‘Model e’ Certified Elite — will be asked to invest $US900,000 ($A1.34m) initially. Most of that will go toward installing two DC fast chargers, at least one of which must be available to the public.

Automotive News (AN) said these dealers would likely  have to invest $US300,000 ($A446,000) more, and add a third fast charger, by 2026, to bring the total cost to $US1.2 million ($A1.78m).

Ford said Certified Elite dealers will carry limited stock and have demonstrator models but will be able to sell an unlimited amount of EVs.

The lower tier — ‘Model e’ Certified — will require a $US500,000 ($A743,000) investment that will mostly go toward installing one public-facing fast charger. 

It is believed that those dealers will be allowed to sell no more than 25 EVs per year and not carry inventory or have demo vehicles available.

AN said that Ford originally did not envision a lower tier that could sell EVs, even in a limited capacity, but added the option following discussions with dealers.

Ford said the costs for each tier could change based on potential federal or local incentives to install EV chargers. It’s partnering with three consulting companies to help dealers install the equipment.

For those dealers who stay with Ford’s ICE offerings, the car-maker hasn’t dropped the ball. Its latest is the  seventh-generation Mustang and the Mustang performance series ‘Dark Horse’, complete with carbon-fibre wheels from Australia’s Carbon Revolution.

Dark Horse is the first new Mustang performance series in 21 years and was touted by Mr Farley as the type of offering Ford plans to introduce as it focuses its combustion products on “families” of vehicles with strong enthusiast appeal.

“People are leaving the segment, like Dodge, so we have a chance to really present something new about Mustang, and we want to do that at the start; we don’t want to roll it out over time,” said Mr Farley. 

“We’re going to keep investing, keep our ICE products really exciting.”

Ford’s National Dealer Council chairman Tim Hovik, in an interview with AN, said the balance of manufacturing ICEs and EVs was generally regarded as a trade-off.

“If you’re going to build more of one, you’ll build less of the other,” he said.

“To my knowledge, we’re the only company that’s come out in a position to grow our ICE engines as well as our BEVs at the same time.”

By Neil Dowling