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Ford CEO Wants Vehicles Sold Online Only With Non-Negotiable Pricing

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Ford CEO Jim Farley had a lot to say at the 38th Annual Bernstein Strategic Decision Conference, which took place on June 1. He spoke at length about the evolution and consolidation of the auto industry at almost every level, including dealerships. From his perspective, he sees a shift to online vehicle sales at non-negotiable prices and long-distance delivery.

That doesn’t mean the dealer will disappear altogether. Towards the end of the hour-long conversation, Farley likened Ford’s current position to retail firm Target, which is adding an e-commerce aspect to its physical location to better compete with Amazon.

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“That’s what we have to do on the retail side,” Farley said. “We have to go to non-negotiable prices. We have to be 100 percent online. The vehicles, no inventory so direct to customer, 100 percent pick-up and long-distance delivery.”

While Farley did not directly reference Tesla during this part of the discussion, it is largely implied that he sees the California-based EV company as a competitor in this way. Tesla does not operate with a traditional dealer network, but Farley views the future Ford dealer network as specialist on multiple levels, providing retail customers with direct, long-term support.

“But then we had this opportunity to use our physical presence, outperform [the competition],” he said. “Like, I’m sure some Mach-E and Lightning customers would love to have a Mustang for the weekend. Maybe they want Super Duty. [Ford] can do that, [the competition] can not.”

Dealers have definitely come under scrutiny in the past year or so amid dwindling stocks of new vehicles. Selling prices above MSRP have become commonplace, with some higher-demand models seeing significant markups. Some dealers have also come under fire for allegedly changing signed rental contracts, adding extra fees, or refusing to let renters buy cars. Infiniti issued a warning to dealers for potential inappropriate behavior related to rental contracts, while Ford and General Motors issued a general warning about excessive price increases that could damage the automaker’s relationship with customers.

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