Ford CEO says EVs will be sold 100% online with nonnegotiable price • Hacker News Board

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#351

Post by medler » Fri, Jun 03, 2022, 4:01 AM UTC

user3939382 wrote: post #326

medler wrote: post #82

This article takes an off-the-cuff comment from the CEO of Ford and reads too much into it IMO. He wasn’t saying dealerships are going away; he was actually saying the opposite. The point he was making was that Ford is going to adopt some of Tesla’s practices while using the dealership network to compete with them. Here’s the quote with more context: “I believe for retail, we have to -- it's kind of like what happene…

> This article takes an off-the-cuff comment from the CEO of Ford and reads too much into it Ford announced 3 months ago that they were forming a new corporation, Ford Blue, whose purpose is to skirt state dealership laws in order to lawfully sell these EVs direct to consumers. So this is definitely not just a comment. https://www.freep.com/story/money/cars/ford/2022/03/02/ford-...

I’m skeptical that this reorg will allow Ford to sell direct to consumers, and I haven’t seen any reporting saying that it will.

Notably, Ford has explicitly said they’re not doing that: “We’re not keeping dealers in the mix 'for the moment.' We are betting on dealers for the long term. I want to make that really clear. I’m not mincing words. We will have new standards and a new experience. But we learned a lot by watching Tesla."

Maybe going direct is the secret plan, but I don’t see how they get there.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#352

Post by smsm42 » Fri, Jun 03, 2022, 4:01 AM UTC

signatoremo wrote: post #340

smsm42 wrote: post #143

Earlier quoted context omitted.

The thing is Tesla is a luxury car for rich people - upper middle class and above. This means you only need a limited number of show rooms - where most rich people live - and rich people are also pretty mobile, so they can come to you. Scaling the same for car with more broad appeal may be hard to manage for the company, and there's no incentive for the third party to do it if they can't sell. Honda sells 4x more car…

I’m guessing EV sale in your state is minuscule compared to ICEs? Why do Tesla need more than one showroom if that one can handle all the sales in the state? Or maybe there are Tesla showrooms in adjacent states that are frequented by consumers from your state? Also, not all Tesla sales happened after consumers visited their showrooms. Tesla itself planned to close most of their showrooms at some point [0], only to r…

Tesla doesn't need more showrooms. But somebody like Honda or Toyota couldn't do with the same one-showroom-per-state model. That's why I have three Honda dealerships and three Toyota dealerships within 30 minutes drive of me.

> Tesla itself planned to close (all) their showrooms at some point,

Maybe for Tesla it could work. For Toyota - they'd be insane to do something like that.

> Do you think Ford can’t afford five or ten showrooms?

They could afford, but that would cost them. And it probably won't be very efficient. For Tesla, whose buyers have little concern for price, and whose meme value is obvious, it may work. For Ford, which very much competes on price and utility with about a dozen other makers, I don't think such a move would be survivable. They could sell one special model this way, maybe, but making whole business - I'll believe it when I see it, done not for a niche rich people's car but by some mass-market vendor.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#353

Post by mjh2539 » Fri, Jun 03, 2022, 4:03 AM UTC

ericd wrote: post #175

pishpash wrote: post #114

Earlier quoted context omitted.

Wait till you deal with real estate agents, or any middle man.

Plenty of people rooting for their demise, too.

Without them you'd only have recourse to attorneys. Deeds and contracts and all that. Plenty of people are rooting for their demise too.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#354

Post by wenc » Fri, Jun 03, 2022, 4:04 AM UTC

thaeli wrote: post #317

toomuchtodo wrote: post #190

Earlier quoted context omitted.

Diplomacy is the art of saying “good dog” until you make it to the rock. Ford is learning what Tesla knew from the start: dealership interests aren’t aligned with EV manufacturers. There’s very little service revenue, and dealers are incentivized to add “market adjustments” to vehicles (which Ford dealers have been doing) creating a poor customer experience. Ford has existing dealerships and is going to have a heck o…

Is there really that much service revenue for modern ICE cars that isn't stuff BEV cars need too? Modern powertrains are pretty bulletproof, 10k oil changes and 30k air filters will get you to 100k miles. "Tune ups" aren't really a thing anymore either, especially in the first 100k. Brakes? Maybe you're cutting out one or two pad slaps in that 100k. Oil changes? Yeah, you've eliminated those, the lowest margin servic…

I own a fairly reliable ICE car from 2009 with ~100k miles, and I've had to get servicing for belts, water pump, brake pads, sway bars, oil changes, etc. I estimate I spent about $5k over the life the car on servicing.

That's excluding tires, wiper blades and air filter changes.

Owners of less reliable ICE cars probably spend more.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#355

Post by walrus01 » Fri, Jun 03, 2022, 4:04 AM UTC

grogenaut wrote: post #245

justahuman74 wrote: post #111

Earlier quoted context omitted.

But it sounds like the local middleman is getting rich at the expense of fellow-locals

I'm glad if I'm going to pay someone for not doing anything it's a local person so I can see how much my money is helping them at the country club I can't get into.

Perhaps you can gaze wistfully at their yacht you can't hope to afford in the local marina you can't afford moorage at too!

Fun times for all.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#356

Post by NonNefarious » Fri, Jun 03, 2022, 4:11 AM UTC

That's not gonna sit well with red states, bro. They're the ones that made selling directly to customers ILLEGAL... even by an American company.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#357

Post by skolos » Fri, Jun 03, 2022, 4:12 AM UTC

heavyset_go wrote: post #314

toomuchtodo wrote: post #190

Earlier quoted context omitted.

Diplomacy is the art of saying “good dog” until you make it to the rock. Ford is learning what Tesla knew from the start: dealership interests aren’t aligned with EV manufacturers. There’s very little service revenue, and dealers are incentivized to add “market adjustments” to vehicles (which Ford dealers have been doing) creating a poor customer experience. Ford has existing dealerships and is going to have a heck o…

Unfortunately, manufacturers' interests are often not aligned with retail customers' interests. For example, with Tesla, the company optimizes delivery numbers of cars sold by sacrificing quality control, and their service center model is anemic and almost an afterthought, especially when it comes to addressing the QC issues their customers experience. For every Tesla with 400k miles on them with a few thousand dolla…

> the company optimizes delivery numbers of cars sold by sacrificing quality control

How do you know this? Did you see their internal data? There are lots of anecdotes going around about Tesla's quality. However, with all the TeslaQ it is hard to believe that there is real correlation between anecdotes and data. Here are my anecdotes - I owned 6 Teslas over last several years. Not one of them had any QC issues. I had one service done because I hit tire debris and front break dust shield started making noises. Tesla fixed that for me quickly with no charge. As for the data - during earnings calls they mentioned that they do pay close attention to their customer experience data and they had period of time where service was lagging. But they started addressing this issue and saw improvements. The way they are growing I do believe they need to keep close eye on customer experience, but looks like they understand that themselves and use data to make sure they are on top of this. Unfortunately there's not much reliable independent data to have better understanding of this issue.

Add: The intent of my comment was to ask if parent info is based on specific data or just anecdotes. As an example, I gave my own anecdotes and mentioned that they are not reliable correlation to the data. Somehow the responses I've got are all about anecdotes, mine or others, also some personal judgement of my ability to appreciate cars or judgment of my life circumstances that required me to have these many Teslas. Can we get back to discussing the main point I'm making - do we have data to make any of these judgements?

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#358

Post by NonNefarious » Fri, Jun 03, 2022, 4:13 AM UTC

hackernewds wrote: post #269

zeeb wrote: post #47

I imagine the +$20k "market adjustment" markups on the F-150 lightning (and other EV's and hybrids) [0] by dealerships probably factored into this decision. [0]: https://www.washingtonpost.com/business/2022/02/12/ford-gm-d...

Ford has cautioned that they would ban dealerships for this practice.

Ford doesn't do shit to dealerships. When you have a grievance with one, you realize how little control the manufacturer has (or is willing to exercise) over them.

If some dealership gets sanctioned by a manufacturer for being jagoffs, they'll put up a new sign next week and be a Toyota (or whatever) dealership. The manufacturer knows this and won't alienate them for one customer.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#359

Post by fomine3 » Fri, Jun 03, 2022, 4:15 AM UTC

paxys wrote: post #39

A lot has been said about the dealership model in the last few years, and the almost universal consensus is that it is an unnecessary and predatory industry and all auto makers should just sell cars directly like Tesla does. That being said, is there any counterpoint to this view? Are there any benefits that dealerships offer today over direct sales? What would we lose if we got rid of every dealership? If there is t…

So much hate for car dealership is seems to US specific problem. I don't see so much complains from other country.

Re: Ford CEO says EVs will be sold 100% online with nonnegotiable price

#360

Post by therockspush » Fri, Jun 03, 2022, 4:16 AM UTC

Alupis wrote: post #127

paxys wrote: post #39

A lot has been said about the dealership model in the last few years, and the almost universal consensus is that it is an unnecessary and predatory industry and all auto makers should just sell cars directly like Tesla does. That being said, is there any counterpoint to this view? Are there any benefits that dealerships offer today over direct sales? What would we lose if we got rid of every dealership? If there is t…

When I see "No Haggle, Fixed-Price, Online Only", I think "Rip Off", and I can't be the only one. It's not that I enjoy haggling with car salesmen, walking out the door and getting hunted down in the parking lot like an animal... I don't... in fact I hate it. But at the end of the day I get a deal I'm satisfied and comfortable with - and it's always below MSRP - far below. I think what we're seeing here is a combinat…

I enjoy a car haggle every now and then, but what makes it so fun is that its one of the few places you can haggle.

Try to haggle down the price of a bean burrito at taco bell and see how much fun that is. There are all kinds of bean burritos to choose from in mi barrio, but they aren't budging to make a deal.

The same people haggling for cars are paying over asking on house bids.

I've haggled at a guitar center, but then I can't do the same thing at a hot topic when I pick up my chain jeans.

It's a weird game, but more bragging than haggling. The sense of satisfaction at having bargained it down is a pretty good rationalization after you've purchased.