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Jason Cole, executive vice president of Cole Automotive Group, which includes the Ford store in Ashland, Ky., said the automaker must “go back to the drawing board” on the program. He is particularly concerned about the profit margin structure on future EVs.
Cole said Ford indicated he would lose 2 percentage points of guaranteed margin in the first two years of the program unless he met certain requirements. He said Farley emphasized that margins would decline and that Ford dealers must sell subscription services to customers to recover.
“I think it’s very important that every state association really fights this,” Cole said. “I think all the other manufacturers are looking at what’s going to happen here. If Ford succeeds in this, I think every manufacturer will follow suit, and it could be the end of the franchise dealer.”
State association officials have not ruled out legal action if Ford doesn’t address their concerns, though many hope the two sides can reach an amicable settlement.
Hall, at last month’s Automotive News Retail Forum in Chicago, said his association and likely others “will be very aggressive in ’23,” introducing legislation to strengthen dealer franchise laws. of the state. He cited the Ford EV program as an example that prompted the need for such action.
Marty Milstead, head of the Mississippi Automobile Dealers Association, alerted the state’s Motor Vehicle Commission, which enforces the state’s franchise laws, about possible violations of Ford’s program. The commission then contacted Ford, who agreed to send representatives to Mississippi for a mid-November meeting on the matter.
After the commission issues a decision, Milstead said, the dealer association will review its options.
Ford and its dealers have traditionally had a strong relationship, and the company has been open to feedback in the past, such as when it paused a Lincoln-brand facility program before making changes based on dealer preference.
North Carolina’s Glaser said dealers in his state are open to flying to Michigan for a meeting with Ford executives, though he has not yet received a response from the company on the request.
“Our Ford dealers are very grateful for their partnership with Ford,” said Glaser. “They’re not angry, they just want to change the program to work.”Lindsay VanHulle contributed to this report
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