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Tesla's major competitor, Ford Motor Company is urging its
dealers to halt their investments in the EV
certification program amid upcoming changes to the program.
Now this request comes as the company plans to introduce
updates to its EV strategy. Responding to the evolving
market dynamics that are going on right now.
Now the CEO of Ford, Jim Farley, announced in December of 2022
that 1920 dealers would join Ford's EV sales program.
However, since then, several dealers have opted out, leading
Ford to revise its EV strategy. Marty Gunsberg, a Ford
spokesperson, confirmed that as of December, dealer enrollment
for 2023 has dropped to just about 50% for about 2/3 a year
prior. This decline is attributed to
changes in the market, prompting Ford to ease some program
requirements. Now.
Last year, Ford reduced the number of required Level 2
chargers and extended the installation timeline.
Andrew Frick, who's the president of Ford Blue,
indicated that further changes are forthcoming.
Frick said there's a lot that we'll be reviewing now.
Ford plans to meet with his dealer council next month to
finalize updates, taking into account feedback from nationwide
meetings with dealers. Now Ford has asked dealers to
pause their investments in the EV certification program until
mid June. The company aims to provide more
informed guidance based on the forthcoming council discussions,
Frick said. We don't want them to make any
decisions between now and the middle of June, emphasizing the
need for dealers to wait for more detailed information before
proceeding with their investments.
Now, one significant concern among dealers is the shifting EV
market. Ford has allayed some of its EV
plans and is focusing on smaller, more profitable EV
models, aiming to better align its dealer network with these
new objectives. And while Frick did not disclose
specifics, he noted that both the dealer console and
executives are reliant on the process.
Based on feedback from the dealer meetings recently, Ford
has sought cost cutting ideas from suppliers to make its E VS
more affordable. The Model E unit posted a $1.3
billion loss in quarter one and a $4.7 billion loss last year.
A Ford anticipates a $5.5 billion loss in its EV business
this year. Fairly emphasized that Model E
must stand on its own. Ford projects that its next
generation E VS will become profitable within a year of
their launch. Meanwhile, the company is
introducing more hybrids to bridge the gap.
Now the request for dealers to pause EV investments follows A
comprehensive review of feedback for over 1000 dealers across 11
meetings during a recent dealer engagement tour, they said.
We're now in the process of reviewing all that collaborative
engagement and turning it into intermediate, midterm and long
term changes where it makes sense for our customers, our
dealers and Ford. Specific details will be shared
in the coming weeks. Changes to the EV certification
program last November reduced the requirement for L2 chargers
from 5:00 to 2:00 for certified status and from 5:00 to 3:00 for
certified Elite status. The need for a Level 3 fast
charger by 2026 was also removed.
Now Ford's Model E-business unit has faced financial challenges
leading to a delay in $12 billion worth of EV related
spending due to slower than expected EV sales growth
impacted by affordable issues and insufficient charging
structure. Now as of December 2020, two 2/3
of dealers had signed up for the EV charging program.
Currently, about half of Ford's dealer network is enrolled.
The program has faced legal challenges with varying results.
Now, Ford's dealer console meeting next month will address
the feedback received from the recent dealer tour aiming to
refine the EV certification program and possibly other
business areas, they said. Our plans are really aimed at
simplifying and reducing complexity.
The company will review everything from floor plan
assistance to Model E standards and Ford credit policies.
And the EV certification program has been controversial due to
significant investments required for dealers.
Despite multiple revisions, Ford has seen a substantial drop in
dealer participation. Ford continues to develop future
EV models and aims for increased affordability, including a
rumored next generation electric pickup.
Now the company remains committed to adopting its
strategy to changing market conditions.
What was great is that we. Had candid.
Conversations around every aspect of the business, nothing
was off limits, said Frick. Its collaborative nature of the
recent dealer meetings. Hey, thank.
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