Tuesday, October 4, 2022
News Ford Dealers Have 6 Weeks to Decide if they Continue Selling EVs

Ford Dealers Have 6 Weeks to Decide if they Continue Selling EVs

Ford dealerships around the United States have six weeks to make a decision that will impact their future.

  • Ford has unveiled a certification plan for dealers that will be necessary to sell its EVs starting in 2024

  • Dealers who choose not to get the certification will not be able to sell EVs until 2027

  • The company says dealers will need to invest between $500,000 and $1.2 million to keep selling EVs

Ford announced its plans to improve the buying experience of its EVs and in doing so, set a six-week ultimatum to its dealerships in the United States.

The automaker split its operations into three earlier this year, with all of its electric models being included in a division called Ford Model e while its gasoline and hybrid vehicles are managed by a division called Ford Blue Oval. Commercial vehicles are now handled by Ford Pro.

In order to better compete with EV-only brands such as Tesla, Ford believes it will need to greatly improve its EV buying experience, which it will do by forcing its dealers to obtain a Model E certification in order to have the right to sell electric vehicles.

Over the next 6 weeks, Ford dealerships all across the United States will have to choose between three options the automaker is offering them.

The first option is to get the Model E Elite certification, which implies installing at least two level 3 DC fast-charging stations and a level two charger, as well as having one level 3 charger available to the public. This should cost between $1.0 and $1.2 million to the dealership, with 90% of the cost being directed towards the purchase and installation of the charging equipment alone.

Dealers can also choose to become Model E Certified, which will only require them to install one level 3 charging station which needs to be available to the public, at a cost estimated to $500,000. In order to prevent every dealer from choosing this option instead of the more expensive Elite certification, Model E dealers will only have a limited supply of electric vehicles to sell each year which will be the same for every dealer regardless of their sales volume. Ford has not yet announced the actual number of EVs that will be available for these dealers, but it said it would be low enough to only satisfy the dealer’s most loyal customers.

Finally, Ford dealerships can decide to forgo the certification process entirely. This means that they will be forbidden to sell new electric vehicles starting on January 1st, 2024, when the certification program will be established.

Dealership owners will need to be confident in their decision since they will not be able to change their certification status for three full years after that date, meaning that dealers who chose not to get certified will not be able to sell new Ford electric vehicles until 2027.

The reasoning behind the requirement that Ford dealers have fast chargers available to the public is that the automaker’s network is so well established around the country that 96% of Americans live within 25 miles of a Ford dealership.

This means that having at least one level 3 charger at each Ford dealer could provide a massive boost to the public charging infrastructure in the US.

The Model E certification program also mandates that dealers will need to have their mechanics train on electric vehicles regularly and they will need to offer transparent pricing that is non-negotiable so that buyers can compare prices between dealers and complete the entire purchase online if they wish.

In order to help smaller dealers afford to get certified, Ford will continue to offer its financing programs destined to help capital improvement.

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