Wed, 07 Dec 2022

Ford challenges dealers to match Tesla selling prices

Robert Besser
14 Sep 2022, 01:32 GMT+10

DETROIT, Michigan: Jim Farley, the Chief Executive of Ford Motor Co, will head to Las Vegas next week in a bid to convince Ford dealers to reduce the cost of delivering electric vehicles to customers by as much as $2,000.

Ford has told dealers that one key topic for the meetings will be a discussion about new agreements governing how dealers sell their expanding lineup of EVs.

In July, Farley told analysts that to be competitive with Tesla and other EV startups that sell directly to consumers, Ford needs to reduce its vehicle selling and distribution costs by $2,000.

About one-third of those savings could come from a "low inventory model," where customers order a vehicle and Ford ships it to them directly, rather than dealers stocking vehicles for weeks or months, Farley said.

We think that's about worth maybe $600-$700 in our system," Farley told analysts, adding that Tesla can also adjust prices rapidly on its website and keep most of the gain from a price increase.

Dealers said Ford will outline minimum investments for charging stations and other equipment to support their EV customers.

A key question will be how quickly dealers will be required to install chargers, which dealers said can cost as much as $500,000.

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