Ford has made clear it wants to restructure its selling model, including building an e-commerce platform where customers can shop and buy electric cars at non-negotiable prices in an effort to match Tesla’s profit margins.
The automaker also announced that it is spending $3.7 billion to hire 6,200 union workers to operate several assembly plants in Michigan, Ohio and Missouri as part of the automaker’s plan to sell 2 million electric vehicles annually globally by the end of 2026.
Much of the investment is going toward factories that build the company’s vehicles, including the F-150 Lightning pickup truck and a new electric vehicle scheduled to start production in the middle of the decade.
However, the company said it is also investing in factories where its fuel-powered cars are assembled. It plans to use some of the money to produce a new Ranger pickup and a Mustang coupe.
The company expects to join forces with dealers, suppliers and automakers as the industry begins to build more electric vehicles.
The comments come at an uncertain time for auto prices due to the supply chain crisis and dealer manipulation of customers over new cars.
According to the company, future merchants will not hold any inventory. Instead, the vehicles are shipped directly to the customer, with remote pickup and delivery.
Their work might change a lot,” the company’s CEO said. There may be many winners and losers. I think there may be a consolidation of efforts. But He did not give a time frame for switching to online sales. Nor did he detail Ford’s plans for its dealer network.
Transitioning to an online-only sales model may entail many challenges, because automakers have limited control over dealer networks.
State laws protect car dealers, and they spend millions of dollars a year on lobbyists to maintain their standing.
Tesla operates retail stores but does not have agents, a key advantage in lowering middlemen costs and retaining profits.
Ford is working with dealers to move into the future
Meanwhile, Ford has changed more than the way it sells cars. In a landmark restructuring in March, Ford separated the electric vehicle business from the internal combustion engine vehicle business.
Profits from the internal combustion engine vehicle business are financedcalled Ford Blue, the growth of the electric vehicle business, called Ford Model e.
The company’s CEO likened his vision of the automaker’s sales model to the store chain’s strategy of leveraging its traditional stores to compete with Amazon.
He said: “The Target chain might have collapsed, but it didn’t.” Store chain Target has used its experience as a physical retailer to its advantage while modernizing the idea of e-commerce.
“We have to charge non-negotiable prices and go 100% online so that inventory goes directly to the customer with 100% remote pickup and delivery,” Farley said. But this does not mean getting rid of personal agents.
Ford Focuses on Electric Vehicles in Europe
