Ford will transition to 100-percent online, fixed-price, delivered (to your home) sales for their electric vehicles, according to CEO Jim Farley
CEO Jim Farley says direct delivery and zero negotiation are necessary for the brand’s EV business. These transactions will be online, leaving out car dealers. Ford is looking to replace part of the dreadful dealership experience with online purchasing. That’s right, no haggle pricing for vehicles. Unfortunately, it’s only for their electric vehicles. I have a hunch, that if this proves to be popular, it may move to all of their vehicles.
Ford is following Tesla‘s model for car purchasing, but there are bound to be differences. Dealerships will still exist, but they will have to adhere to an all-new model.
Farley used Target and Amazon as examples.
“I believe for retail, we have to… It’s kind of like what happened between Amazon and Target. Target could have gone away, but they didn’t. They bolted on an e-commerce platform and then they use their physical store to add groceries, and make returns much easier than Amazon. They use their expertise as a physical retailer to their advantage, but they modernize the e-commerce piece, so it would be really easy to do business with them. It’s exactly what we have to do on the retail side. We got to go to nonnegotiated price, we got to go to 100% online. The vehicle, there’s no inventory, goes directly to the customer, 100% remote pickup and delivery. But then we have this opportunity to use our physical presence to outperform them.”Ford
Over the past two years, consumers have been hit by unreasonable dealership mark ups. Not all dealerships are doing this, but quite a few are. In many cases, it drops to the level of unscrupulous tactics. Many consumers have noted that dealerships have increased pricing to such a point that it makes buying a vehicle nearly impossible. This is for a majority of buyers out there. Only the privileged few can afford these ridiculous prices. Ford is aware of this, and this may be one of the reasons why they are changing the game plan.