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Small Ford Dealers to Benefit from Allocation System Tweaks

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Small Ford Dealers to Benefit from Allocation System Tweaks

https://fordauthority.com/2024/02/small-ford-dealers-to-benefit-from-allocation-system-tweaks/

 

FordAuthority.com_2024-02-08_F-150 Inventory Line.jpg

 

The past few years have been rather tough on Ford dealers, as those entities have dealt with near-record low inventory levels, a struggle to secure new and used inventory, and the controversial Model e Certified program, which is now required for dealers that wish to sell EVs. While CEO Jim Farley recently met with a group of Ford dealers at this year’s NADA Show and noted that he’s open to feedback, some still feel a bit left out in the cold, regardless, after the automaker didn’t stick around to answer questions that some had regarding the company’s stance on EVs and other hot topics. However, at that same event, FoMoCo also told its smaller dealers that it’s going to tweak its allocation system to benefit them, according to Automotive News.

 

“We were missing an opportunity to engage with the dealers on their unique issues,” said Matt Atkenson, Ford’s U.S. field operations manager. “It’s just different in these rural areas. Our allocation system for decades has been based off an earn-and-turn; the more you sell, the more you get. If you’re a smaller-volume store, it’s hard to sometimes get that one-off unit to handle that specific customer.”

 

Now that production is ramping back up to normal levels and inventory has improved substantially, however, FoMoCo plans to tweak its allocation system and bring back an old program that benefits small dealers, specifically – otherwise known as U300 dealers, which sell fewer than 300 vehicles annually. The program will prioritize verified retail orders from these small stores, even if they don’t have any allocations at that time. Atkenson noted that the specific details of this program still need to be worked out, however, though he did note that the automaker is working to simplify and streamline its processes at the same time.

 

“When supply got low, we had to suspend that program, and we weren’t sure if we’d bring that back,” he said. “But now that inventory levels are getting more stable, we brought that back. There’s a co-op program they can claim money for. We’ve basically said they’re self-approved from now on if they provide an itemized invoice. They don’t need the bureaucracy from us.”

 

Edited by ice-capades
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This seems like a good thing to me.  It's always struck me as odd that Ford would intentionally limit real customer orders at specific dealers essentially "because" (I know there's a formula etc).

 

To me, it should be real orders get priority and allocation rules don't apply to them, and then stock beyond that falls under the regular allocation formula.

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I think this is a goood compromise between the old system and providing all dealers with extra allocation for retail orders.  This way the super dealers like Grainger can’t monopolize retail orders with loss leader pricing but buyers at smaller dealers don’t get penalized.

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17 minutes ago, rmc523 said:

This seems like a good thing to me.  It's always struck me as odd that Ford would intentionally limit real customer orders at specific dealers essentially "because" (I know there's a formula etc).


They’ve done that in the past with specific models although the details escape me (that was not a pun..).  But not across the board until recently.  

 

19 minutes ago, rmc523 said:

To me, it should be real orders get priority and allocation rules don't apply to them, and then stock beyond that falls under the regular allocation formula.


Thats exactly what they did with Bronco launch.  They even went further and said the orders would be built by order date regardless of dealership.  But then you had a couple of dealers like Grainger doing orders at or below invoice so they ended up with a huge proportion of orders effectively locking out allocation for other dealers.  So they had to change it so those dealers did t monopolize retail orders.

 

That was never a big issue in the past because retail orders were only 10% and very few things were in short supply.

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This article is a lot of "smoke and mirrors" and distorts the facts. "Select" Ford Dealers have always had priority, expedited scheduling for retail orders regardless of allocation. 

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