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Electric Vehicle Discussion Thread - Ford Related


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From jpd80's linked article: 

Quote

"We appreciate that Ford wants to develop an EV charging network across the country; we just don't think it should be at our expense," Glaser said. "It should be market-driven rather than a mandate."

He said he's not sold on Ford's demands for dealerships to have public-facing chargers.

"You can charge your car in front of thousands of Walmarts, Targets," Glaser said. "In the long term, what consumer is going to charge their car at a Ford dealership if you could drive down the block and charge in front of a Starbucks?"

 

And, interestingly, this: 

Quote

Jason Cole, executive vice president of Cole Automotive Group, which includes a Ford store in Ashland, Ky., said the automaker should "go back to the drawing board" on the program. He's particularly concerned with the profit margin structure on future EVs.

Cole said Ford has indicated that he would lose 2 percentage points of guaranteed margin over the first two years of the program unless he meets certain requirements. He said Farley has stressed that margins will decline and that Ford dealers should sell customers subscription services to compensate.

"I think it's very important that every state association really goes to fight this," Cole said. "I think all the other manufacturers are looking at what happens here. If Ford gets by with this, I think every manufacturer will follow suit, and it could potentially be the end of the franchise dealer."

State association officials didn't rule out legal action if Ford won't address their concerns, though many were optimistic the two sides would reach a palatable agreement.

 

As has been noted in other contexts, the dealers have their state franchise laws to fall back on and try to protect their income.

Edited by Harley Lover
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Thanks Harley Lover,

there’s still a few issues within the agreement that are troubling to dealerships, I think this is an example of Ford trying to bully changes at dealerships that suit its ends without understanding or caring that such infrastructure may be completely unnecessary….it’s basically forcing every applying dealership to become a public charging Center, county application rules and power supply then become issues that may result in the county rejecting the application 

Edited by jpd80
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11 hours ago, Harley Lover said:

From jpd80's linked article: 

 

And, interestingly, this: 

 

As has been noted in other contexts, the dealers have their state franchise laws to fall back on and try to protect their income.

I really don’t understand the necessity of these upgrades.  I can understand as a dealer why you would want a charger at your dealership, but Ford forcing you to install them would be like forcing you to install a gas station. 
 

I suspect Ford has an ulterior motive, but I’m not clear what it is yet other than maybe trying to reduce the number of dealerships.  

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27 minutes ago, tbone said:

I suspect Ford has an ulterior motive, but I’m not clear what it is yet other than maybe trying to reduce the number of dealerships.  

 

Good points tbone, culling of the Ford dealership herd may in fact be one of Ford's ulterior motives. Longer term, another ulterior motive on Ford's part is establishing an example that other incumbent automakers follow, thereby resulting in the situation quoted by Mr. Cole in the article: "I think all the other manufacturers are looking at what happens here. If Ford gets by with this, I think every manufacturer will follow suit, and it could potentially be the end of the franchise dealer".

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13 hours ago, jpd80 said:

Thanks Harley Lover,

there’s still a few issues within the agreement that are troubling to dealerships, I think this is an example of Ford trying to bully changes at dealerships that suit its ends without understanding or caring that such infrastructure may be completely unnecessary….it’s basically forcing every applying dealership to become a public charging Center, county application rules and power supply then become issues that may result in the county rejecting the application 

 

My point in quoting those 2 passages was to point out that it's not just the charging station issue the dealers are fighting, (some) dealers also are fighting Ford's ability to set margin on EVs. Granted that Ford are using the charging station issue to link to the margin change, but in the abstract, I can't see a situation where Ford would not be allowed to set whatever margin it desires, as long as all dealers are treated equally - perhaps that's the rub.

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Part of it is dealers just not liking factory set pricing.  Dealers need some chargers to service EVs but requiring public chargers seems unnecessary.

 

Limiting allocations based on investment amount seems ridiculous.  Should be 100% or nothing.

 

I suspect they’ll negotiate a compromise.

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I’m starting to see the start of companies supporting BEVs in my local area-Tesla super chargers at the local convenience store (Wawa) and a new Target has level two chargers in the parking lot. We had Telsa Super Chargers at an newer outlet mall for a few years and I think electrify America is there also. We have a pretty decent penetration of Tesla products and I see Mach Es and the new Kia BEV around. I’ve actually seen more Rivians then Lightings on the road and saw the SUV Rivian yesterday afternoon. 
 

Also found out NJ generates almost 50% of its power from Nuclear another 5% from various different sources and the other 50% is natural gas when I was looking up the chargers at Target. 

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6 hours ago, akirby said:

Part of it is dealers just not liking factory set pricing.  Dealers need some chargers to service EVs but requiring public chargers seems unnecessary.

 

Limiting allocations based on investment amount seems ridiculous.  Should be 100% or nothing.

 

I suspect they’ll negotiate a compromise.

Exactly! How many gas pumps/storage tanks are dealers required to have now?

Looks like stairstep version 3.0. Maybe tie investments to OTD's actually on the ground & delivered.

Edited by Chrisgb
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Could Ford have an incorrect perception of BEV dealer’s role, what is it that they expect them to do?

Surely servicing will be reduced massively, like Tesla does brake fluid checks and cabin filter service every two years..

What exactly do dealers get for their $1.2 million  investment….

Edited by jpd80
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LOL.

To read all of this speculation, one might think that big bad Ford foisted this on the poor wittle dealers with no input or dialogue with the dealers. Again, from  the article quoted by jpd80: 

Quote

Tim Hovik, chairman of Ford's National Dealer Council, said he understood the state associations' positions and suggested that the program still can be modified before taking effect. He noted that Ford held dozens of meetings with dealers whose stores vary in size to try to craft the best possible solution.

"Council is — 'supportive' might be too strong a word — but on board with where the company's going," Hovik told Automotive News. "The evolution of where we finished versus where we started was a direct result of dealer input. We've got a really good blueprint, but there are a couple flies in the ointment that we're going to have to work our way through. I feel there are pieces of what we rolled out that are very useful and can be effective, but I also think there are a lot of pieces that can have tweaks."

 

"Dozens of meetings with dealers".

"The evolution of where we finished versus where we started was a direct result of dealer input".

LOL

Trying to get all dealers to agree to anything is the equivalent of herding cats.

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11 hours ago, akirby said:

BEVs have unique requirements and unique competition and business models.  It has to be different but not to the degree Ford is requiring.

 

The optimal retail sales and service model for BEV is direct-to-consumer. Ford's initial plan for dealerships is actually quite conservative, the fact that there are still "flies in the ointment" even after Ford and dealerships held "dozens of meetings" shows what a big impediment the franchised dealership model is for Ford as the company transitions to 100% BEV.

 

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7 hours ago, jpd80 said:

Could Ford have an incorrect perception of BEV dealer’s role, what is it that they expect them to do?

Surely servicing will be reduced massively, like Tesla does brake fluid checks and cabin filter service every two years..

What exactly do dealers get for their $1.2 million  investment….

 

End result is that your allowed to keep selling product after 15 years or so, depending on how fast the market transitions over. 

It also boils down to that there are far too many Ford dealerships in some areas. For example, I have 10 Ford dealerships within a 25 mile radius of where I live. 

In the same radius, I only have 5 Home Depots (Big Box home improvement store) or so in the same radius, which is some place you'd frequent a lot more then a dealership. I don't even think places like Walmart or Target have the same market penetration. 

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On 11/5/2022 at 11:51 AM, mackinaw said:

 

Surprised that the city and local power utility can't accommodate this dealer.  Every dealer, no matter the manufacturer, will be selling EV's at some point and will need additional power.  So will all the dealers in your town shut down?  


I agree, I’m not in some small town either….this dealer is in a “smaller” city relative to others nearby, but south Florida is one continuous/connected metropolis, with interconnected cities.   So for them to not be able to upgrade doesn’t entirely make sense…..unless they’re being told that the upgrades couldn’t be done in a reasonable time so that they could make an informed decision by Ford’s deadline?  


This dealer is also the only Ford one for at least a 10 miles radius, and perhaps more importantly one of the few Lincoln dealers in the area (in an area that has a lot of Lincoln’s), so I feel it’s not okie Ford would want to close.


i frankly don’t understand these imposed time limits of “you have to sign up for Model E by X date, otherwise you have to wait another 5 years to sign up” (or whatever it was).

 

as others have speculated, maybe it is an effort to reduce dealer numbers.

 

 

On 11/6/2022 at 9:45 AM, akirby said:

Part of it is dealers just not liking factory set pricing.  Dealers need some chargers to service EVs but requiring public chargers seems unnecessary.

 

Limiting allocations based on investment amount seems ridiculous.  Should be 100% or nothing.

 

I suspect they’ll negotiate a compromise.

 

I also don’t understand the 25 EVs per YEAR limitation.   Seems like Ford would be shooting themselves in the foot here?   Customer comes in, “sorry, we’ve sold our 25 cars for the year, come back next year”


 

10 hours ago, jpd80 said:

Could Ford have an incorrect perception of BEV dealer’s role, what is it that they expect them to do?

Surely servicing will be reduced massively, like Tesla does brake fluid checks and cabin filter service every two years..

What exactly do dealers get for their $1.2 million  investment….

 

Unless Ford thinks people are going to hang out at the dealer and look at the latest models while their vehicle is charging ?

but requiring that seems excessive.  Requiring some for service needs I understand.

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3 hours ago, silvrsvt said:

 

End result is that your allowed to keep selling product after 15 years or so, depending on how fast the market transitions over. 

It also boils down to that there are far too many Ford dealerships in some areas. For example, I have 10 Ford dealerships within a 25 mile radius of where I live. 

In the same radius, I only have 5 Home Depots (Big Box home improvement store) or so in the same radius, which is some place you'd frequent a lot more then a dealership. I don't even think places like Walmart or Target have the same market penetration. 

So this is a way to thin the herd and make dealerships that stay with Ford Blue eventually a thing of the past?

Signing on as Model E dealership is the future, do it or get left behind?

 

And on that last point, if servicing of BEVs is not really a thing, I can see a lot of existing dealerships folding up in the next 5-10 years regardless of whether they sign up or not.

 

People may be happy to buy on line direct to Ford and come pick their vehicle up from a warehouse like Tesla buyers do, maybe this is a way of easing the dealer network to a new reality coming in a few years…

Edited by jpd80
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41 minutes ago, jpd80 said:

So this is a way to thin the herd and make dealerships that stay with Ford Blue eventually a thing of the past?

Signing on as Model E dealership is the future, do it or get left behind?

 

And on that last point, if servicing of BEVs is not really a thing, I can see a lot of existing dealerships folding up in the next 5-10 years regardless of whether they sign up or not.

 

People may be happy to buy on line direct to Ford and come pick their vehicle up from a warehouse like Tesla buyers do, maybe this is a way of easing the dealer network to a new reality coming in a few years…

 

That is what I'm thinking-its a way of saying, you need to change and the change is going to be huge. I'm not sure how large dealership like Automall or Lithia are going to survive

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40 minutes ago, silvrsvt said:

 

That is what I'm thinking-its a way of saying, you need to change and the change is going to be huge. I'm not sure how large dealership like Automall or Lithia are going to survive

 

Most of large dealers will just morph into real estate developers since they generally are sitting on a lot of valuable urban and suburban land.

 

The small rural dealers that don't own any valuable land... I think they are the one really fighting this. 

 

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1 hour ago, justins said:

Surely this will be fairly clear cut, no? 

 

Existing franchise agreements will be absorbed by Ford Blue, while those that stump up the 1.2 will sign agreements with Model E in addition to Ford Blue. 


Doesn’t work that way.  Franchise agreement is with Ford period.

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1 hour ago, akirby said:


Doesn’t work that way.  Franchise agreement is with Ford period.


For Ford branded vehicles, if Ford created a new direct to consumer brand that sold different versions of the vehicles there is nothing Ford Dealers could do other than cry that they killed their golden goose. A lot of this case law was settled of what was and wasn't allowed during the GM bankruptcy.

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I think all legacy automakers are jealous of Tesla not having to work with dealer franchises. The only reason dealers exist is because they have state law makers in there back pocket so no one get the antiquated laws governing car sales repealed. Between the dealer markups and over priced service rates and high pressure extended warranty and add on sales tactics I have no love for the current system. Sure eliminating the dealerships would cost jobs but those cars would get serviced at manufacturer service centers or somewhere else and those places would need people. Sales and finance people would get absorbed into other retail verticals.  Its the franchise owners that would lose their high incomes and political power.  Sorry rant done, but really I think in 10 or 20 years new car dealers will be a thing of the past or look very different than today. What Ford is doing is just the tip of the proverbial iceberg. As more and more new EV companies with no dealers begin to sell in volume the legacy companies will see the dealers as a bigger and bigger net competitive disadvantage rather than a plus. 

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21 hours ago, bzcat said:

 

Most of large dealers will just morph into real estate developers since they generally are sitting on a lot of valuable urban and suburban land.

 

The small rural dealers that don't own any valuable land... I think they are the one really fighting this. 

 


the local Chevy dealer sold the used car building on their property and a 7 story old folks home is going there.

 

2 hours ago, jasonj80 said:


For Ford branded vehicles, if Ford created a new direct to consumer brand that sold different versions of the vehicles there is nothing Ford Dealers could do other than cry that they killed their golden goose. A lot of this case law was settled of what was and wasn't allowed during the GM bankruptcy.

 

Another caveat to that is that the government was involved in the GM bankruptcy.

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1 hour ago, Tico said:

I think all legacy automakers are jealous of Tesla not having to work with dealer franchises. The only reason dealers exist is because they have state law makers in there back pocket so no one get the antiquated laws governing car sales repealed. Between the dealer markups and over priced service rates and high pressure extended warranty and add on sales tactics I have no love for the current system. Sure eliminating the dealerships would cost jobs but those cars would get serviced at manufacturer service centers or somewhere else and those places would need people. Sales and finance people would get absorbed into other retail verticals.  Its the franchise owners that would lose their high incomes and political power.  Sorry rant done, but really I think in 10 or 20 years new car dealers will be a thing of the past or look very different than today. What Ford is doing is just the tip of the proverbial iceberg. As more and more new EV companies with no dealers begin to sell in volume the legacy companies will see the dealers as a bigger and bigger net competitive disadvantage rather than a plus. 

 

You make a compelling argument, but I still think dealers can be an asset, especially short term.  But no doubt things are going to change, no matter what your point of view is.

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2 hours ago, rmc523 said:

Another caveat to that is that the government was involved in the GM bankruptcy.

 

It was more the fact that Old GM had the franchise agreements.  New GM was created out of the bankruptcy and was free then to negotiate new agreements or not with the dealers.  It was more a function of the bankruptcy law than anything.

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