The state of the current automotive market – one ripe with production issues, inventory woes, and ever-rising prices – isn’t ideal for both Ford dealers and the automaker itself, not to mention customers. Thus, FoMoCo is in the midst of attempting to make major changes to the way it sells vehicles, creating new policies for hot vehicles like the Ford Bronco to stem reservation and retail order abuse, while also warning Ford dealers about grossly marking up vehicles and abusing the vehicle allocation process. Now, according to a dealer memo recently seen by Cars Direct, the automaker is imposing new, far stricter penalties on Ford dealers in an effort to stop brokers and resellers.
Ford is doing this by changing its definition of brokering in terms of its existing policy that is intended to discourage that type of behavior, as well as exporting and reselling vehicles. Dealers that violate this updated policy risk losing out on allocations, particularly on the most desirable new vehicles, for the current model year or even future models years.
“Brokering includes the utilization of any third party to wholesale, transfer, or otherwise deliver inventory, especially vehicles in high demand (including, but not limited to Raptor, F-150 Lightning, and all specialty vehicles),” the memo reads. “Additionally, any non-Ford dealer or non-Lincoln dealer that provide vehicle and inventory relocator services, automotive transfer assistance, dealer trade facilitation, and/or any other company by similar name or service, is considered a broker. The first offense may result in a 1:1 reduction of future allocation by the amount brokered. The second offense may result in all same model allocation being redirected for the current or next model year.”
The policy also notes that transactions are required “to occur directly between an authorized dealership and the purchaser with no intent to broker, resell or export units.” Ultimately, the purpose of this policy change appears to be an effort to protect customers looking to purchase a desirable vehicle, particularly as it tries to encourage those customers to order and wait on a new vehicle rather than purchase one directly from a dealer lot.
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More words, let’s see some actual penalties/actions.
I agree talk is cheap. I would like to see more and more new vehicles sit on the dealers lot.
Something has to give. Ford wants to defy the laws of a free market and maintain scarcity while keeping an artificially low price (in light of demand) and they want to maintain a semblance of an independent dealership model while choking off the dealership revenue and profits. It will be interesting to watch this play out. But, in the meantime, if Ford doesn’t address its horrible quality issues, it will be a lose-lose scenario for everyone involved.
Spoken like a real Ford dealership sales manager. Except the part when you rant about Ford quality. Maybe your dealership should just drop Ford and keep selling other brands. Oh, that’s right – none of your other brands are in such demand, so you can’t gouge the customers. Not every dealer is a greedy profit monger. Plenty sell cars at MSRP. Even in New England.
Ford, you have no teeth. You threatened dealers with mark ups on lightning a year ago and I have seen them advertised on dealer sites for 50k+. You have allowed your dealers to control you and you aren’t going to do anything. All you wanna do is save face.
Oh and another thing, your allocation system is trash. You do nothing to reward brand loyalists. Rich bandwagoners and flippers are defining the market and your true fans have to fight to get a ford performance vehicle without getting ripped off. But lets be honest, you don’t care.
What exactly is holding up the Maverick hybrid production
well probably the massive Burning vehicle recall right now, but prior to that it is always the same old excuse, supply Chain issues.
Tried to place order for Raptor R, dealer wants 25k “market adjustment”, nope! How’s this fair?
You get market adjusted for every other product you buy, why is it so ridiculous when it happens in the automotive industry? There’s astronomical demand and virtually no supply. I’m no economist but there are natural laws in play, here.
When will my Ford Representative at my dealer be able to turn my 2022 Maverick hybrid order into a 2023 order and let me know what the incentives are????
You found a dealer that’d get you a Raptor R for 25k+? That’s what they want for a std V6 raptor here in Seattle. One dealer was thinking 70k+ for the R. None of them will order you one. O And would they? Ford: let me order/reserve on line direct. Dealers can go ahead and markup their allocation for all I care.
Fourty years ago I was one of the first Canadian dealers to ‘ship’ F150s and E150s to the US (through brokers). One day a Ford dealer in Georgia who had zero stock looked across the street at the Chrysler dealer and his front row was FULL of them!! Ford of Canada dropped the hammer and, if caught, the penalty was the difference between Lowest Dealer Cost and Full Retail. A buddy paid over half a million dollars!!
Its Amazing how everyone wants to pay MSRP now. 3 years ago and the almost 100 years before that no one would pay MSRP when supply was plentiful. Dealerships would have loved every customer paying MSRP when they had cars on the lot.
Be careful what you wish for, as you just might get it and for the rest of your life just pay what the manufacturer says. Dont worry, you can trust them to give you a fair deal!!!!
Question; Has ford locked the prices of its cars for the last 2 years to help the customer or have they been raising the MSRP’s since supply has gotten tighter?