Remember just a few days ago when Ford CEO Jim Farley said they had “no plans to spin off our electric business or our ICE business,” during a finance call with investors?
Yeah. Forget all that. The company announced this morning they are creating distinct electric vehicle and internal combustion businesses, one which is poised to “compete and win” against both new EV competitors and established automakers.
I’m sure Farley’s previous statement matches the letter of how his company has been cleaved, if not the spirit, since this move could be construed as a reorganization and not a spin-off. Nevertheless, it shows how seriously the company is taking its opportunities in the EV game and its willingness to shake things up in a big way to advance its goals.
Ford Blue will be responsible for building out the company’s portfolio of ICE vehicles, driving growth and profitability in those sectors. Ford Model e will accelerate innovation and delivery of electric vehicles at scale, while also developing software and connected vehicle tech for all of Ford.
“We’re literally splitting the business in half,” Farley told Automotive News.
But wait – there’s more. Remember Ford Pro? That’s its existing commercial arm which is not tasked with the actual development of vehicles but distributes and sells them while offering hardware and software products for commercial customers. This means there are now three slices to the Ford pie operating under Dearborn’s umbrella.
And, in a key tidbit for members of the B&B who like dealer news, AN reports that Dearborn also said it is planning big changes for its dealership body. Glass House planners apparently want an unspecified number of retailers to opt-in to selling EVs under a new set of standards. These new rules could include carrying no inventory, selling at nonnegotiable prices, and being held to fewer facility requirements.
There is a shuffle of chairs amongst leadership as well. Farley will serve as president of Ford Model e, in addition to his role as president and CEO of Ford itself. Kumar Galhotra will serve as president of Ford Blue while the head of Ford Pro is Ted Cannis. Doug Field will lead Ford Model e’s product creation as chief EV and digital systems officer while also leading the development of software and embedded systems for all of the company. Them’s some long titles, surely leading to what will be the world’s longest business cards.
Another impetus for all this? Corner offices in Detroit and beyond surely eye Tesla stock with much envy; whether one thinks the House of Elon is overvalued doesn’t dampen the fact its market value is many multiple of legacy automakers. With today’s news, $F shares rose about 5 percent in before-bell trading after this morning’s announcement.
[Image: Ford]
Become a TTAC insider. Get the latest news, features, TTAC takes, and everything else that gets to the truth about cars first by subscribing to our newsletter.
Ford needs to go into direct sales for their EVs and cut the dealers out.
That’s exactly where they are headed.
“These new rules could include carrying no inventory, selling at nonnegotiable prices, and being held to fewer facility requirements.”
No inventory and fewer facility requirements is a bone for the dealers who aren’t keen on going electric. Otherwise, dealers could defect.
Eventually, the whole dealer thing will go away, and it will happen when the big mfrs approach their legislatures.
@SCE: The whole dealer thing will not go away. This is a bunch of salaried corporate stiffs in Dearborn copying Tesla — which is a complete anomaly operating on borrowed time.
Once Tesla gets creamed by all the new products coming out — their first mover advantage will be gone and their extraordinarily expensive way of selling will come back and bite them on the rear end. Then those dopes at Ford will figure out they made a huge mistake, update their resumes, and move on to another company to screw up. If Tesla was truly on point — then where’s the pickup? Where’s the new sports car? Where are the successors to the S and X? There aren’t even development mules for their replacements running around yet and both those products are ancient. Could it be their business model is siphoning off too much cash and starving product development as a result? Oops.
Seriously, do you expect a consumer to walk into a Ford or Lincoln dealer and not be able to buy an EV the way they have bought Fords or Lincolns for decades? And what if ICE products are still being sold the old way? Explain that to a customer on the sales floor. And there hasn’t been any conversations with dealers yet. What if they tell Ford to take their demands for another seven figure investment for a Tesla-style showroom in hyper-expensive places to rent like shopping malls and stuff it where the sun doesn’t shine — especially when dealers have franchise agreements providing them territorial rights? Good luck with that level of Cadillac House stupid.
What’s surprising is Ford isn’t talking about a tracking stock to goose their valuation. If they really want to boost the market capitalization of FoMoCo — separate numbers within F ain’t going to do it. They need a separate four letter ticker like FMCE the Reddit gambler clowns can latch onto and boost to the stratosphere. Why that wasn’t part of this announcement is beyond me. You’d think Ted Cannis, former Executive Director of Investor Relations, would be banging on trash can lids to make that happen. Oh, well.
Ugh, you mean that we won’t be able to have a sleazy dude in a cheap suit try to swindle us out of the maximum amount of cash? You’re right, we certainly must keep that business model intact.
Yes because having local dealers that hire people to service your car, have sometimes their own body shops, pay to charities in the city, help with financing under water and low credit folks, having used car on the lot so they can sell people who can’t afford new cars, help answer questions in person, have presence in every little town in this vast country is bad.
But having internet only channel is the right thing. Right I got it.
I mean we already got rid of local hardware stores and bookstores in favor of Amazon and Walmart. We are trying to sell food online. Why not cars. And then complain about cities that have no livelihood about them. Sure that will work.
Home Depot / Lowes is far superior than my old local hardware store. Much larger selection and lower prices.
You’re saying we should continue to have useless middlemen so that the local community has one really rich family that donates money for little league uniforms?
Grayone, Homes Depot and Lowes, are what Sears used to be. Except with less service. And lower prices. At expense of much much worse service.
Here is a test:
Next time you are at Home Depot, based in Georgia by the way, try going to screw department and look for a common screw size. My be 5/8 of an inch. Try finding an associate. See how long it takes.
Next, try that same test at Ace Hardware.
Something to be said for Service, but young ones have never experienced a well informed trained Sears Appliance sales person, and are used to buying at lowest level service.
And all the stuff at Blowes, Home Despot, and MeNards made in China to boot! Drain traps made of the cheapest imaginable pot metal which you have to replace in a year!
As opposed to being able to walk into a local store where they can find anything in two minutes, and you’re outta there in five! Made in USA to boot! And you’re back two hours later for something else! And after four more repetitions the same day (five minutes before they close at 3:00pm), you go galloping through the door and the guy behind the counter says “when you walked out of here 30 minutes ago, I realized you probably needed this,” while holding up the last needed connector, washer or widget, and motions you over to the cash register where they’ve already started ringing up the item(s)!
@pmirp1,
“Something to be said for Service, but young ones have never experienced a well informed trained Sears Appliance sales person, and are used to buying at lowest level service.”
I’m in my 40s, and I’ve talked to a lot of salespeople.
I can’t remember the last time I talked with a knowledgeable salesperson. Maybe it was 10 years ago? For cars and electronics, I usually know much more about the car than the salesperson — so why talk to them?
The work-culture in the United States just does not reward workers who earn knowledge workout changing jobs.
As such, I decide learn about the products what I want before I leave the house.
Hoping to the store to finalize the sale is the end of the sales-journey. The beginning and the middle of the sales-journey all happen at home. The store is just the delivery-point.
So, you’re right in that we’ve never experienced the kind of customer service you’re talking about. But that ended around the time I was born, and it’s not coming back because it’s not profitable for either workers or employers.
Some of us adapt, some of us whinge. [Shrug]
I hate sales people.
I would rather order an appliance online after spending five hours reading reviews and watching YouTube videos about the appliance than blindly walk into a Sears and let the sales person swindle me.
ive got a family owned chain near me that merchandises stuff the big boxes cant or wont, and the prices arent bad.
“Home Depot / Lowes is far superior than my old local hardware store.”
I’d like to nominate this for the most ignorant, brain dead statement made on TTAC for 2022.
@EBFlex,
“I’d like to nominate this for the most ignorant, brain dead statement made on TTAC for 2022.”
One of the things that Home Depot does better than my local Ace Hardware is the combined online/offline experience.
With Hoke Depot, I can use my phone (or PC) to find out of an item is in stock and where it is in the store, before I leave the house.
Those dinky little ACE hardware stores don’t offer that. Instead they offer polarizing gimmicks like that “guns, donuts, & hardware” store. My local ACE hardware is more in-line with the values of my community than that example, but I’ve rarely found a reason to shop there over Home Depot.
This is especially true during the pandemic when my idea of good customer service is to let me pay for my stuff and leave without having to talk to anyone.
Yeah the 10,000 sqft mom and pop hardware store definitely has more selection than the 110,000 sqft big box store with a 25,000 sqft garden area and 35,000 SKUs.
I think Ford mistakenly thinks the Teslas success is because they’re building electric cars. Tesla is successful in part because it is not Ford. It’s new, it’s different, it’s very trendy, it doesn’t have the baggage that Ford is saddled with, and it also builds compelling, deeply flawed products that people seem to love. And again, it’s not Ford. People will eventually grow tired of Tesla. Grow tired of the model styling, which is pretty timeless but everything ages, the maintenance experience, the wait times, the cost of repairs, and are probably experiencing Elon Fatigue right now. Teslas are too expensive from an ownership perspective to ever be mainstream – they’re still toys. Ford faces the same problem they’ve always faced – just make a good product, be consistent, stop trying to screw the customer by covering up known defects (Pintos exploding, bad dual clutch transmissions).
Be consistent, do good work, build reliable cars with a good value proposition, properly and promptly address quality issues. People will be loyal and come back. That’s why I drive a Honda and why I turned in my wife’s 96 Mustang in to cash for clunkers – it deserved to be crushed.
Interesting stuff. Maybe GM could split itself into two divisions – “GM Awesome,” for the Corvette and Cadillac Blackwings, and “GM Derpy” for everything else.
Sadly, both divisions would get parts from the same bin…so even Awesome, out of warranty will be Derpy….
We already have “New GM” and “Old GM or Motor’s Liquidation Corp”.
I wish Ford well, I really do. They still employ thousands of Americans and still make some of their vehicles in America. But I don’t understand why the CEO had to lie about this last week. And yes, he lied. Ironically this was all done to boost stock price and that seems to be working. So CEO lies and stock price goes up. Weird.
He lied because Ford is a ship without a rudder. They have no direction or really any idea what they are doing.
They are jus following the EV fad to boost stock the stock price. They know deep down EVs are a joke and not the future. That’s why they half bake all of their current and future EVs. Not a single one offers a compelling reason, capability, or advantage over a proper ICE vehicle. Talk about a losing strategy
EVs aren’t a fad because even if consumers don’t like them they’re going to be forced to buy them anyway by law.
Even if this is politically resisted in the US, like let’s say the Republicans take control of the federal government for the next decade, China and the EU are going EV.
GM and Ford can’t just exist making gas vehicles for Americans while the rest of the world is EV.
Naah, it’s not a lie…just bulls**t. Spinoffs create separate companies, ala GE. This is an internal reorg.
Now, whether this works for the company is anyone’s guess. Wall Street is betting it will, thus the higher stock price. We’ll see.
I don’t see it as a lie. One division will focus on ICE, another on EV’s, and one on commercial sales.
Curious. Lou and Mike don’t see it as a lie. He said he wasn’t going to do this a week ago and now he says he is. I realize we live in an age where we are desensitized to lying since every elected official and every media outlet lies to us but have you got to the point you cannot see an obvious lie when you see one?
@kcflyer – pathetic attempt at discrediting what one says. Convenient.
Masks work, vaccines work, and social distancing works. Calling something a lie doesn’t make you correct!
“Masks work, vaccines work, and social distancing works.”
Bwhahahahahahahaha.
Sure…if you ignore the science and history.
“Curious. Lou and Mike don’t see it as a lie. He said he wasn’t going to do this a week ago and now he says he is. I realize we live in an age where we are desensitized to lying since every elected official and every media outlet lies to us but have you got to the point you cannot see an obvious lie when you see one?”
Knowing what political leanings they have, it’s clear that they embrace lying and shun the truth. Just look at ANY of their comments ’round these parts.
@kcflyer:
What Farley said was that he was not going to spin off any divisions. A spinoff creates an entirely new and separate company, ala Agilent, which was spun off from HP. Both companies operate completely independently of each other. GE announced a spinoff last year and those companies will also operate independently of each other.
These are different divisions of the same company. As long as both divisions are under the same corporate umbrella, then this isn’t a spinoff.
So, no, Farley didn’t lie – this is a reorg, not a spinoff. Whether the reorg works or not remains to be seen.
@EBflex:
Don’t take it from me or Lou – how about Fortune magazine?
https://fortune.com/2022/03/02/ford-rivian-investors-shares-strategies/
It must really gall you that two meanie liberals know more about how this stuff works than you do.
“It must really gall you that two meanie liberals know more about how this stuff works than you do.”
Not when I look at the stock price and see that the article is full of BS. That article came out on 3/2 when the stock price was $16.74. Right now it’s $17.16.
An increase of $0.42 cents is not what any reasonable person would describe as the “the stock market lov(ing) Ford’s big electric vehicle plans.”
The lying is really troubling. He could have just offered weasel words instead.
Why does the board of directors support such behavior? Seems like Ford is getting desperate.
Mr Musk’s claims come to mind here, but his statements are wishful thinking – or sometimes delusional – more than lies. Product delivery dates and the mythical FSD cross-country trip are a couple examples.
Freedmike, Thoughtful response. I disagree and still see it as a lie but respect your position. As for Lou’s off topic covid rant, wow!
Curious – why would you see it as a lie?
Far as I can tell, what they’re doing here is reorganizing the vehicle production operation into three basic divisions – “Legacy” (i.e., the ICE stuff they’re currently making), EV, and commercial. All will stay under the same corporate umbrella as divisions.
Now, whether this works or not is anyone’s guess, but clearly this isn’t a spinoff. If it were, each of those divisions would become a separate corporate entity.
@kcflyer – you opened up the floor with the comment:
“I realize we live in an age where we are desensitized to lying since every elected official and every media outlet lies to us but have you got to the point you cannot see an obvious lie when you see one?”
That’s a typical antivaxxer/antimask response.
And besides, I knew our resident Ford hater would loose his sh!t over my response.
@Lou:
There doesn’t have to be a political component to Every. Damn. Comment., you know.
nope, no mention of covid in my post. Me thinks thou dost protest too much. For the record I said all politicians and all media lie. If you have run across an honest pol or “journalist” please point them out.
@kcflyer – my apologies
farley should have said theyre thinkin bout goin private again. see what happens… stock up? good! if its good for the musk its good for the gander
“So CEO lies and stock price goes up. Weird.”
Seems like this is a winning combo, I know about another car company’s CEO who seems to spread more lies than truths, yet his company gets more valuable by the day
Ford should be offering more hybrids. Hybrids would gain Ford the mpgs and they are not compromised by range.
100%.
This push to go full EV “RIGHT F’ING NOW” is nothing more than political theatre.
A gradual push by encouraging hybrids and even PHEV vehicles would have been a much smarter play. You are severely reducing oil consumption while allowing EV technology to rise to the level of acceptable.
Right now though, the focus is EV theatre which is resulting in vehicles that are amazingly inferior to even the cheapest of ICE vehicles. Range and refueling is the biggest factor preventing adoption. You have other factors too which are not insignificant, but they come back to range and recharge times (except for price, that is too high but range/recharge times cant fix that).
They offer several hybrid models now. Escape, Explorer, F150…that is the bread and butter of their lineup.
Nobody said they didn’t/ But they are after thoughts and some come with severe compromises.
Like what in relation to their competition?
@Art:
Please hold, he’s checking with Slavuta for a snappy comeback.
@EBFlex,
“This push to go full EV “RIGHT F’ING NOW” is nothing more than political theatre.”
Not for me.
Now that I can afford EVs, I refuse to buy anything else.
As far as I’m concerned, Ford sells three kinds of vehicles: the Mach-E, the F-150 Lighting (vaporware), and used cars (often at new-car prclice and sometimes with no previous owners).
I realize I’m not the whole market. But I do represent a real market-segment. If Ford wants a shot at my money, they’ll need to basically Teslafy themselves.
Speaking of Tesla, the delivery date for my 3-row Tesla Model Y could be as early as May! Once that happens, Ford loses their shot at my business for as long as that car lasts — which could be a very long time.
@Luke42–Has Tesla manufacturered a running model of the Cybertruck yet? Ford has produced a running and fully operating model of the Lightning and is now taking orders for it with manufacturer and delivery this Spring. Hardly vaporware when the Lightning will be available shortly and the Cybertruck possibly never. I have to give Ford credit for actually producing their EV truck instead of all hype. Ford will have some teething problems with the Lightning as they have with the E Mach I but they will get it sorted out. I would rather buy an EV from a Chinese manufacturer than from Tesla and that is saying a lot.
“Has Tesla manufacturered a running model of the Cybertruck yet?”
Several. They are starting to get spotted testing. The biggest gating factor for the Cybertruck is going to be the Austin 4680 battery line. Not sure if Kato road alone could provide enough cells along with the Y production at Austin.
If I’m not mistaken, some of the production equipment for the Cybertruck may have been photographed arriving at Austin. Not sure. I haven’t been paying much attention to it and just skimmed over the post.
Don’t know why you’d think that Cybertruck would never make it to production. Steel Dynamics is just finishing the plant in Sinton Tx to make the steel for the panels and there is ongoing work in Austin to create the production facilities there. Are they going to set up production lines for something and build prototypes, then suddenly decide not to produce it for no reason?
@mcs–So when is the Cybertruck scheduled for production and is there a pre production model that is operating and has this pre production model gone thru certification for pedestrian and passenger safety? It is illegal to produce a vehicle for sale that does not meet the all federal safety standards and I doubt the current design especially the front would pass since it could potentially kill a pedestrian. The final production Cybertruck if it is even manufacturered will not look like the current Cybertruck. Ford has the Lightning which has passed all safety standards.
@mcs–I am not a big fan of Elon Musk and would never buy a Tesla. I don’t drink his Kool Aid. That is not to say I am a big Ford fan I have my own criticisms of them along with GM. But even if Tesla was the last manufacturer in the World I would not buy a Tesla.
The question isn’t whether the Cybertruck is in production or not – it’s whether something that bad=acid-trip ugly should ever be allowed to roam the streets freely without a parental advisory sticker. Thus endeth my rant.
(Seriously, though, I don’t think the Cybertruck is going to be a hit – the styling is the most obvious reason.)
“Not for me.
Now that I can afford EVs, I refuse to buy anything else.”
Simply put…you’re not very bright. Automakers are not in the business of making a vehicle for each individual person’s needs. EVs appeal to a niche part of the market. People who view vehicles as appliances but are to cowardice to use public transportation.
All auto makers would agree that the larger market you appeal to, the larger your sales are and the larger your profits are. With EVs being a major source of pollution, having range issues, recharge issues, etc, people are not drawn to them.
Once those issues are fixed, you will have widespread adoption. But, like I said, it’s all political theatre.
@dahlquits651459499x: As usual, the effluent spewing from your keyboard is totally inaccurate. People that like vehicle performance are buying EVs over slower ICE-powered vehicles. If what you said was true, then why are people spending extra money on the performance versions of EVs? They’d just go for the slowest version if that was the case.
Jeff A,
“Ford should be offering more hybrids. Hybrids would gain Ford the mpgs and they are not compromised by range.”
Ford DOES offer hybrids. Both the F-150 and the Explorer are available as hybrids, and very capable ones at that. What more do you want?
An EV is the more that I want.
Nobody cares about Ford’s hybrids, because green car guys like me have already had our hybrid decade(s) and want EVs — and the change-resistant people want ICE vehicles just like their grandpappy drove (but a little nicer).
Ford and Toyota are already serving the hybrid middle-ground pretty effectively. But even the people who think it might be a good idea don’t seem to care enough to google it.
My hybrid pick up truck was built in 2010 and it will likely be replaced by a Tesla Cybertruck, if/when the 500-mile Cybertruck comes to market. Hybrids are a bridge technology that’s already served its purpose for a lot of us.
@Luke42–Not everyone can afford an EV and not everyone has a place to charge an EV. Few EVs are priced competitive to ICE. Eventually that will change but for now EVs are not a viable choice for most. Hybrids on the other hand have become more competitive in price and allow those who do not have the facility to charge a cleaner and more efficient alternative to straight ICE. Ford has more choice of hybrids than most manufacturers but they can offer more. Offering more hybrids would have a greater impact on our environment now than selling a handful of EVs. I realize you are an EV fanboy and most likely a Tesla fanboy but not everyone is nor do they want to jump on that bandwagon. Better to have more people buy hybrids than buy straight ICE How about the Government give a tax credit not just for EVs but for the most efficient hybrids to encourage the sales of more hybrid to contribute to using less oil and a cleaner environment.
Many of us are turned off to EVs by the Tesla fanboy cult including me. When I buy an EV I will not buy a Tesla because of the Tesla worship and because you cannot have a Tesla repaired by an independent mechanic and the same thing with John Deere. I don’t worship any manufacturer or CEO.
Fanboy cults don’t bother me much – hell, I drive a Jetta GLI, and there is DEFINITELY a GTI/GLI cult out there. As far as the “I’m not buying anything from Elon Musk” is concerned, I could care less about the personality of a car company’s CEO – if I did, I’d have bought nothing but Chryslers when Iacocca ran the company.
I wouldn’t buy a Tesla because of the sketchy build quality and the stupid ergonomic choices like the yoke steering wheels and IPad-for-everything “dashboard”.
In the end, it’s all about product…at least for me, anyway.
That is the major reason is there build quality is questionable and Tesla will not allow anyone else to work on Tesla’s except Tesla. Anyone who supports the Right to Repair should be against Tesla and John Deere’s practices and therefore not support them. Maybe I am being a little too rigid but I have some principles and one being that if you the customer buy something then you own it and have a right to have who ever you choose to service it as long as they are qualified. Tesla is anti consumer. May I add I don’t need a car with the option of a fart sound.
@Jeff:
Apparently, Teslas CAN be worked on independently.
youtube.com/watch?v=F-B_8oMZNeI
Agreed, though…the “right to repair” issue needs to be addressed.
Sing it. My next car is going to be my semi-retirement travel car. While I like the concept of EV, and if I still commuted daily I’d love one, the reality is I want to be able to cover 500-600 miles a day and not worry about range or a 5-6 hour charge stop. My new car purchase will be happening in ’24, and the Maverick seems impressive.
This would not be a surprise at all. When the classic wireline phone companies saw cell service go from a high end luxury service to everyone and their dog, they split the cell company off from the legacy company, leaving Union Workers and as much regulation as possible in their wake. Now you have independent contractors working like crazy (and occasionally falling off cell towers in the process) instead of decently compensated full time jobs with benefits. Savings, of course, are not passed on to customers. Amazingly, probably the only people I have less sympathy for than Bell Tel/Verizon are car dealers.
MCI/Worldcom survivor here…
The “wireline” companies you’re referring to are the “Baby Bells” that were created by the AT&T breakup, and as I recall, they generally didn’t have cellular phone divisions – they bought cell companies or resold their services.
And correct me if I’m wrong, but at least two major cell companies – Verizon and AT&T – are unionized, aren’t they?
“Savings, of course, are not passed on to customers.”
Yeah, because Cell sevice is no cheaper than it was 10-15 years ago. Additionally, how expensive was your long distance bill last month as opposed to say, 20 years ago?
But nope, no savings have made their way to the customer.
“Savings, of course, are not passed on to customers.”
I’d like to add my two cents here.
One thing markets do really well is ruthless competition. You can (literally) bet your bottom dollar that if any company is making huge unwarranted profits, others will notice and undercut them with cheaper products and more sales.
Look up these greedy company financial reports. Show us these amazing super duper profits. You can’t, because they don’t exist.
EXCEPT when government creates a monopoly for them, via patents or regulation.
@Scarecrow: not quite true. Unrestricted capitalism eventually leads to at best an oligopoly. The large companies either buy-out their competition or engage in cut rate pricing until their competition is driven out of business. Check out how many independent hardware stores were closed down by Home Depot. Or read about Rockefeller and Standard Oil. Or even check out the large food manufacturing conglomerates. And new competitors often cannot emerge due to the cost of developing product and getting to market. That is why so many auto start-ups fail. You need Musk sized pockets in order to actually enter the vehicle production industry successfully.
‘EXCEPT when government creates a monopoly for them’
Big money from big business in politics ensures that a monopoly is the inevitable state of affairs.
I’m not up on accounting, but creating a new entity to handle the EV side would allow them to hide (or at least obfuscate) losses from the EV entity off of the F balance sheet would it not?
I don’t think they’re creating a new “entity” per se – these appear to be divisional reorgs. So they’d all be on the same balance sheet.
Negative, it’s all still part of parent Ford, if anything it would showcase how the EV vs ICE businesses are doing profit wise
If Ford wanted to hide losses then it would make sense to keep the status quo. A Lightning F150 loss could easily be hidden among the profits from F150/250/350 Lariat, King Ranch, and Platinum models. Same could be said for the Mach E. The markup on Shelby Mustangs could be bumped up and none of the buyers would care.
Having 2 different division for Ice/EV makes sense, since the vehicles are so different. However, the tag line “connected, always on experiences, powered by software” fills me with dread.
Ford is confused. It is like a brick and mortar store in internet age that forgets have a local store is an advantage not a demerit.
Check this blurb from article:
“Glass House planners apparently want an unspecified number of retailers to opt-in to selling EVs under a new set of standards. These new rules could include carrying no inventory, selling at nonnegotiable prices, and being held to fewer facility requirements.”
Having cars to pick from is an advantage for many buyers who don’t want to wait for something they can’t even test drive. Being able to negotiate with dealers on price, can many times mean a sale as opposed to no sale. Tesla customers have excellent credit and can buy online with no haggling. Fully 50% of auto sales in America are price and credit sensitive and financed by dealers.
Remember Amazon buys whole foods to compete with Kroger. Tesla doesn’t have the money to build retail stores. Yet Ford wants to put retail stores out of business to go Tesla model. This is when you know how desperate Ford is to mimic Tesla.
I think you are misinformed.
Tesla’s stores have cars you can test drive. I did so back in 2018. These demo vehicles get put into their sales inventory from time to time, so occasionally you can actually get a new car right now.
During more normal times, they have even kept stock of prebuilt cars, but that’s almost nonexistent today.
At one point the wait time for a build-to-order car was just a few weeks, but that’s gone now – just like with everybody else. However, they are prioritizing the most expensive versions, which are about a 1-2 month wait.
In normal times, you don’t get to test drive an F150. You get to test drive the F150 you are going to buy. Even now it is still possible. With Tesla you always have to order what you want.
See you are the one that is confused.
I don’t see test-driving the exact car I’m going to buy as an advantage when it means that I get little or no choice in the car I’m going to buy. The F-150 is a particularly good example there; the chance that the dealer has the same combination of engine, trim level, drivetrain, gearing, bed length, and options that you actually want is minimal. Instead you walk out with whatever the majority wants, not what you want.
dal20402,
“Instead you walk out with whatever the majority wants, not what you want.”
And that right here, is the self righteous attitude of younger generations. Have it exactly as he or she wants.
See, this is exactly the reason new homes cost as much as they do. Because, we want it exactly as we want it.
We want granite. God forbid we want laminate countertop.
We want tile floors in bathroon. God forbid we want vinyl plastic. or in kitchen.
We want hardwood, or laminate, God forbid we want carpet.
We want what we want. Not what the builder or the dealer wanted.
Next time you and the privileged younger generations complain about inflation, understand it is because it is what you want not what you can have that drives higher prices.
Good grief. I’m talking about ordering a truck, something that has been possible since before you were born. I’d rather test-drive a demo that’s not perfectly representative if it means I get what I want in the end, that’s all.
I’m in the middle of completely rebuilding a house right now and we have made plenty of concessions to stay on budget.
I at least want to have a chance to drive the same trim level as I want to buy. Even if just to confirm the decision that I came to through my own research is going to work for me.
The only time I might not do so is if I happen to know someone who drives the same vehicle as I’m thinking of purchasing.
Otherwise, when I drop the keys to the test vehicle off, it’s usually as I’m sitting down to talk turkey and have an order placed.
That’s why the order blank exists.
My last new vehicle purchase was done this way. It just requires patience (and in this market, a LOT of patience).
My next new vehicle purchase will also be made this way. Since I usually keep vehicles for a long time (as in 10 years or longer), I want it the way I want it.
If the options offered on the vehicle are limited (IE: just 2 or 3 trim levels like most imports) then they don’t need many physical units to test drive. Per the housing example below we picked our cabinets, flooring and counter tops based on samples. Why can’t this work for ordering a car?
The real problem with this business model is people don’t want to wait – 2 day Prime has spoiled everyone. However I would gladly wait if I can customize it perfectly. And I did just that with my truck… took 6 weeks for Dodge to build to my exact specifications, even had my name on the window sticker.
Yeah, the person writing that builder a half a million dollar check and putting themselves on the hook for 30 years should have no input in the materials used in their home.
GTFOH, How about the builder who I have hired to build my home use the materials I have paid them to use and that I desire.
Semantics. If you test drive the model and order one because exactly what you want isn’t available, once it arrives you’d be able to test drive again to make sure it’s up to snuff. I’ve done that several times.
@Dave M:
Why make this much sense when ranting is so much more fun?
The guy’s first complaint was that there was no local dealership for Teslas (there are). Then it was on to there being no local service for Teslas (which there is). Next up: Tesla dealerships encourage bad table manners and the Heartbreak of Psoriasis…
“Tesla’s stores have cars you can test drive.”
They also have service departments. There are two such locations here in Denver.
“Tesla doesn’t have the money to build retail stores.”
Apparently, they don’t need traditional stores, or Super Bowl ads, either.
But they have money to build plants in Shanghai, Berlin, and Austin in the last 3 years, and to build Supercharger sites at a 35% annual pace.
If the future is electric, no wonder Ford is freaking out – they are several laps behind Tesla.
Ford might be several laps behind Tesla but at least they are coming out with an actual EV truck that you can order and starting this Spring will be manufacturered and delivered to dealers. Tesla should be worried about the Chinese manufacturers who plan on launching their EVs within the next few years. Elon won’t be so smug after the Chinese eat into his nearly exclusive EV market. Agree that there are things Ford can learn from Tesla especially the system they have for customers buying their EVs but Tesla has poor quality and repairs and service are not very customer friendly.
The more I think a bout it, splitting in two didn’t work out so well for the Roman Empire – and Mr. Farley is no Constantine.
Ford has two competing market-segments which both need to be served like their jobs depend on it.
Ford’s plan, therefore, is to serve both market-segments and let the market sort it out.
It’s the traditional prescription for The Innovator’s Dilemma.
It worked out quite well for the Eastern Roman Empire – it lasted for another 1000 years.
https://s23.q4cdn.com/799033206/files/doc_downloads/2022/02/Transcript-Ford-at-Wolfe-Global-Auto-Feb-23-2022.pdf
Once again, TTAC just regurgitates what other sites are saying. Care to read what Farley said?
Thanks Lou interesting. Ford’s problems are like GM’s and any other big corporation in that it is hard to react to change quickly. I do agree with Farley that EVs should be marketed and sold differently than ICE but there are just enough of the remnants of the franchise dealer to muck up his EV program model. Might be better to go to Tesla’s model for Ford’s EVs of purchasing and have a place where the buyer can test drive and have the EV serviced. Doubt most EV buyers would be happy with the traditional dealer system when they buy their new EV. Ford also needs to make their plants more flexible to allow for production of a particular model to be produced in an additional facility if that assembly plant basically makes vehicles off that same platform. You don’t want customers waiting months and months for their order. Its not just a chip shortage that is causing production delays but in the case of the Maverick it shares the same plant as the Bronco Sport and now the Maverick is being sold in Brazil as well as Canada, the US, and Mexico. Ford is not as flexible as they need to be on meeting increased demand for a particular model. Ford’s assembly plants need to be more flexible. Need to have a shorter time from when a vehicle is ordered to when it is produced and when it is delivered to the ultimate buyer.
@Lou:
Some folks don’t like to actually look stuff up before they opine. If the usual suspects had looked up what ‘corporate spinoff’ actually means, they’d know this isn’t one.
The internet and social media causes laziness and has been shown to “reprogram” the brain. We expect everything to be quick and easy. No one wants to do any leg work.
As a kid I’d have to plan my day to go to the library to research something. You’d then read volumes to find the information you need.
Now?
One just looks for something that will appease one’s confirmational bias.
I can recall a time when internet citations were not permitted.
@Lou_BC, interesting link. I actually printed that off and read every word of it (while sitting outside in the sun because I’m a bum and it’s nice out today).
By “interesting” I mean “terrifying” if I were a long-term Ford employee [which of course I am not].
Did a deep-dive on WWII a couple weeks ago, which prompts this question:
Is Farley on Pervitin, or has he moved on to the good stuff?
@ToolGuy – IIRC, methamphetamines are still prescribed for military pilots.
@28 – Was that when TTAC contributors actually researched the topics they opined upon?
@Lou
I was referring to late high school and college, some teachers/profs specifically would not allow them and only peer reviewed/published sources were acceptable. One once explained his reasoning which was two fold:
1. You could not trust everything on the internet.
2. Get our collective rear ends into the library for credible sources.
@28 – sorry. I misunderstood. Yes. True. Citations could only be from professional sources. I had to meet that standard when I was developing policy and procedure for the last place I worked. They wanted 3 corroborated studies to back up any changes. In some cases I’d “cheat” a bit by searching professional journals for best practice standards and then trace back to their sources. It saved time and kept administration and the Medical Advisory Committee happy. Saved me from reading 100’s of boring research papers.
Ah so you can relate. I’d be curious to know what university students are being told today.
“In some cases I’d “cheat” a bit”
I promise I won’t go back in time and alert your previous bosses :D
They’re not applying their “Decades of engineering, high-volume production expertise” to their EVs? But that’s the whole reason to buy an EV from a traditional brand right there.
My guess is internally they can’t make things flow well between departments/groups etc. so they are opting for the Rodger Smith Saturn solution: create a new entity to succeed apart from the existing dysfunction.
And eventually become a parasite on the host as people doing things “the old way” make their way into the organizational structure.
And the old GM reared its head and turned Saturn into a clone of their other divisions and then killed Saturn. There still is enough of the old GM in the new gm just as there is enough of the old Ford in the new Ford. Both GM and Ford when they get a product right it is hard to beat them but more often they get bogged down in their managements ineptness and they turn what could be a great product into a dog.
The E-Series is electric, right?
https://www.ford.com/commercial-trucks/e-series-cutaway/
(Well, obviously – sorry for the stupid question.)