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Ford (F, $14.66) outlined a series of requirements for its dealers who want to sell the automaker’s electric vehicles, such as setting no-haggle prices and investing upward of $1.2 million in upgrades like charging. Dealers will have until October 31 to decide to buy in. If they do, they’ll be authorized to get in on Ford’s Model e business starting January 2024. Those who don’t can stick with Ford Blue, the automaker’s internal combustion engine unit.
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Ford is positioning the move as a chance for dealers to empower themselves and increase sales dramatically. The automaker will use about 90% of the dealers’ investments to build out charging infrastructure including DC fast chargers that will allow dealers to be part of the Blue Oval Charge Network Map.
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The ultimatums came nearly six months after Ford split its company into two divisions, one focused on its legacy internal combustion engine vehicles and the other on the products it views as its future, like the F-150 Lightning and Mustang Mach-E.
Why it matters
Ford CEO Jim Farley, wants Ford’s retailers to cut selling and distribution costs by $2,000 per vehicle to be competitive with the direct-to-consumer model. “We’ve been studying Tesla very carefully over the last several years,” Farley said. Wall Street analysts have largely viewed direct-to-consumer sales as a benefit to optimize profit. However, there have been growing pains for Tesla (TSLA, $302.61) when it comes to servicing its vehicles.
