THE DEADLINE IS HERE – who's gonna sell Ford's EVs?

S3 Magazine Podcast

In mid-September, Ford announced that all Ford dealerships had until Halloween to decide if they wanted to become ‘EV Certified’. The giant stipulation was – it would cost each Ford dealer roughly $500,000 or $1,200,000… depending on if they wanted to be Tier-1 or Tier-2 certified. And a huge part of that cost is to build-out a public charging infrastructure at the dealership. In other words, if a Ford dealer wants to play along & be ‘Model E Certified‘, they must now install a complex public charging network at their location. Since there are Ford dealerships in practically every town in America, this is Ford’s clever scheme to quickly build-out a national Ford charging network… at their dealer’s expense. And Ford’s ultimatum/leverage to dealers is this: Tier-1 Elite Certified dealers (@ $1,200,000) get the largest EV allotment. Tier-2 Certification ($500,000) gets to sell some EVs. And if a dealer does not get certified & contribute to the charging infrastructure, they do not get to sell any new Ford EVs. OBVIOUSLY THIS WENT OVER LIKE A FART IN AN ELEVATOR. Those are huge expenses to throw on dealers. Especially considering that real-world consumer demand for EVs is low… at least outside of metro areas. For instance, only about 1% of all cars in the US are currently EV, and almost 40% of those are stuffed into California. Ford sold ~63,000 F150s in July 2022, versus ~2,000 Lightnings. Plus, despite the endless media praise, reality is, Ford’s current crop of EVs have been riddled with inventory shortages, soaring prices, delivery delays & sale-stopping recalls. So how many Ford EVs are even going to be available for Ford dealerships to sell? It seems that the new industry standard is to keep supply just under demand. Ford CEO, Jim Farley already announced this past summer that Ford ultimately aims to sell new EVs direct-to-consumer like Tesla… and that dealerships could be involved but that “the standards are going to be brutal”. Ford is also mandating that their dealers sell EVs at fixed pricing with less profit margin… again to try & model themselves after Tesla. Essentially in the Ford EV business model, the dealer is just a point-of-pickup for the customer who buys online. And the dealer basically gets a small fee to take delivery & fluff the customer. All of this points to: Why on earth would Ford dealers (outside of California & a few other metro cities) make that $500,000-$1,200,000 investment? AND HERE’S WHERE IT GETS INTERESTING… Because what happens if/when the dealerships unite & decide NOT to make that investment? In other words, what if the Ford dealers tell Ford to pound sand… because… that’s kind of what’s happening here. How will Ford pivot & sell EVs if that’s the case? Honestly, all signs point to the fact that Ford wishes to eliminate dealers for the EV sales-model anyway (like Tesla). But one of Ford’s strongest attributes is their nationwide dealer network. And now there’s turbulance & uncertainty in that network. If Ford dealers are not allowed sell new Ford EVs… who will service them when problems arise? As a customer, you don’t wanna be caught anywhere near that shit-show. Ford is so consumed with beating Tesla, that they’ve gotten sloppy. Their stern Halloween deadline got swiftly pushed back to early December due to all hell breaking loose. But now, it’s Decemeber. So what’s the call boys? You gonna stick to your guns?