Ford's Lightning; How they ruined a great product.

[BennyTheBeaver]

Positive dealer experiences and level expectations of what FoMoCO can and will do in the future is what keeps me coming back.

Certainly there are those like Benny with a soured experience, but I hope Ford Model-E future is brighter, as they evolve out of the consolidated model, maybe they will grow positively plus or minus a few knee scrapes along the way.

The purchase model of vehicles has changed. Dealers are not operating as sales centers on a lot of these newer purchases, they are glorified Delivery Centers with an attached Service Department (and Parts/Accessories).

An example is that Dealers get reimbursed on every purchase for X amount of marketing dollars. My dealer spent $0, locally, advertising the Lightning (at least nowhere I saw), yet FoMoCo gave them money back on my purchase for their marketing budget. Who really pays for that reimbursement? The consumer. These little things add up, and explain why Ford is losing on average roughly $750 on each Lightning sold.

I would be all for dissolving the sales departments at dealers, getting rid of the anxiety driving haggling, and having these dealers deliver vehicles to customers (while retaining Service, Parts, Accessories). My dealer sold me nothing, they delivered a vehicle I reserved and "ordered" through FoMoCo.

@TaxmanHog I, too, am optimisitc that Model E brings positive changes. My opinions reflect my experience and observations in the current FoMoCo, Dealer, Consumer relationship.

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[Grumpy2]

The 10% wasn't all profit. Over 3% was for upgrades that Corporate mandated, 1% is for delivery prep, the remainder includes allowances for advertising and such make up the remainder to keep the dealers in business.
Where did you think they are only losing $750/truck??

 

[Garyl]

Bottom Line is you have a chose to make. Take delivery of the Ford, purchase a Rivian or wait on the CT. You purchased the Ford with dealer margin included. Is the current dealer system ideal "Hell No" but until people expose the state dealer association bank roll going to the state legislators don't expect much of a change. Enjoy your truck, steer people to dealers that act responsible and don't expect Ford to turn into Tesla.

 

[BennyTheBeaver]

The 10% wasn't all profit. Over 3% was for upgrades that Corporate mandated, 1% is for delivery prep, the remainder includes allowances for advertising and such make up the remainder to keep the dealers in business.
Where did you think they are only losing $750/truck??

It was reported, multiple sources, that FoMoCo loses roughly $750 on each EV sale. Ford ranks at the bottom, which is why I claim they are grossly mismanaged at the top. It's not the engineers, manufacturers, or 99% of the employees.

(Here is one source after a 10 second Google search: https://www.visualcapitalist.com/charted-teslas-unrivaled-profit-margins/)

That loss per vehicle isn't completely tied to dealers, it's a larger indication of the company's mismanagement which was what my original post was about. It delved into the dealer issues I mentioned.

Dealer's sales departments are not "selling" these trucks. They are delivering them to customers who ordered them, often with little dealer help.

The few new vehicles they get on their lot due to FoMoCo sending dealer stock, or canceled orders have been marked up by quite a few (I know not all) dealers which FoMoCo gets no piece of. These dealers also are not buying local ads for the Lightning, they don't need to, yet they still get to recoup marketing expenditures on each "sale".

Having a previous background in marketing and media, I know what these dealers get as far as marketing allowances from Ford for their sales departments. I also know what some of them spend. It's not surprising to realize these 2 things aren't equal.

 

[BennyTheBeaver]

Enjoy your truck, steer people to dealers that act responsible and don't expect Ford to turn into Tesla.

Good post. I agree, and this is exactly what I'm doing.

Don't use the dealer I had for your delivery center, find a better Ford Delivery Center than I had.

 

[TaxmanHog]

Dealers are not operating as sales centers on a lot of these newer purchases, they are glorified Delivery Centers with an attached Service Department (and Parts/Accessories).

There are 50 states and multiple territorial jurisdictions regulating how auto manufacturers retail in these markets.

FoMoCO is not Tesla (as we all know) and they along with all other legacy manufacturers are not apt to battle legislative changes, hence you see the limitations the TESLA delivery centers experience in some places in the nation along with the positive experiences of where they are able to operate as they do.

 

[BennyTheBeaver]

There are 50 states and multiple territorial jurisdictions regulating how auto manufacturers retail in these markets.

FoMoCO is not Tesla (as we all know) and they along with all other legacy manufacturers are not apt to battle legislative changes, hence you see the limitations the TESLA delivery centers experience in some places in the nation along with the positive experiences of where they are able to operate as they do.

@TaxmanHog, I have a lot of respect for your thoughts, opinions, and most importantly time you've spent helping myself and others here on this forum. Period.

I'm aware of auto industry regulations. I understand why we are in the mess we are in.

I, for one, am happy FoMoCo isn't Tesla. One reason I won't, currently, buy a Tesla is for a lot of the same reasons I chose to buy a Ford. I'm also not saying Ford should expect to be as profitable as Tesla.

I do, however, see copious amounts of inefficiencies and wasted money in the current business model and regulatory restrictions the current American Auto industry must participate in. FoMoCo just seems to be worse than the other major manufacturers at managing their business. That is my main point here.

Shrugging it off, throwing our hands up, and just saying it is what it is fixes nothing. I don't enjoy the current automobile buying experience. I'd prefer change, and competitive prices, without penalizing the employees (engineers, manufacturers, mexhanics) that are responsible for these fantastic EV Trucks.

 

[TaxmanHog]

Sharing our opinions and voting with our dollars is as much as we can do, I'm certain there are many corporate eyes reading our opinions and experiences.

Old, large businesses take time to turn, it's more challenging in rough seas than in calmer times.

I think back on my work career with 'UNCLE', I see the same challenges and opportunities to make positive change in entrenched bureaucracies, FORD has much more freedom to make wise and righteous choices for its shareholders and customers alike.

 

[BennyTheBeaver]

Old, large businesses take time to turn, it's more challenging in rough seas than in calmer times.

Agree.

The problem here is that by the time these businesses finally do turn, it might be too late, specifically because every Automobile Manufacturer in America isn't having to play by the same rules.

If Ford's profitability per vehicle is behind every other manufacturer that plays by the same rules, we can't just blame the system for Ford's issues.

 

[BedFullOfElectronZ]

Ah, now we're getting to the root of the issue.

Your dealer was paid the 10% (sales department), the relationship you are referencing is with the service department.

When I mentioned a relationship with the dealer, I was thinking more than just service, although service is an important part of the relationship. I wanted a dealer that could provide financing options (my dealer provided me with a better loan than my usual credit union was offering), handle a trade-in (and also handle the trade-in of my Lightning when the time comes), provide me with a mannequin that I could test drive before I finalized my order (this was very useful in helping me to decide to actually order my Lightning), provide service and loaner vehicle (which, I imagine, requires the cooperation of the sales and service departments), as well as provide high-speed charging and other "Model E" services in the near future. Also, in my experience you get somewhat better treatment at the service department if you bought your car at that dealer (nicer loaner, etc.).

 

[BennyTheBeaver]

When I mentioned a relationship with the dealer, I was thinking more than just service, although service is an important part of the relationship. I wanted a dealer that could provide financing options (my dealer provided me with a better loan than my usual credit union was offering), handle a trade-in (and also handle the trade-in of my Lightning when the time comes), provide me with a mannequin that I could test drive before I finalized my order (this was very useful in helping me to decide to actually order my Lightning), provide service and loaner vehicle (which, I imagine, requires the cooperation of the sales and service departments), as well as provide high-speed charging and other "Model E" services in the near future. Also, in my experience you get somewhat better treatment at the service department if you bought your car at that dealer (nicer loaner, etc.).

Sounds like you found a good dealer that may have earned a fair share of that amount FoMoCo pays dealer's for each sale.

I don't need to go into each gripe I had with my dealer's Sales Department, but my experience in no way mirrored yours. Here's a single anecdote though: being on a test drive and teaching the sales rep I was assigned that the Lightning has dual motors says all you need to know about my sales team.

The finance team at my dealer messed up my registration paperwork, causing a delay in getting my plates from the DMV. They also tried to charge me about $600 more for registration fees than I needed to pay, this caused me to have to go to the DMV myself to get clarified. (I started feeling bad for the employee's at my dealership when the finance person also commented about how good my company's compensation package was compared to his employer, with examples. I didn't even know how to respond.)

 

[PA Lightning]

A vehicle is a product that can be purchased without a dealer. Tesla proved that.
I am probably one of the few that like dealing with my Ford dealer, because they go above and beyond even after the sale. That is important to me and I don't think they treat me that way because every now and then I drop off a few dozen bakery donuts.

I know a lot of members have had unpleasant experiences, even with dealers they purchased a number of vehicles from. That is unfortunate, but there are good dealers out there, you just need to find them.

 

[BennyTheBeaver]

I know a lot of members have had unpleasant experiences, even with dealers they purchased a number of vehicles from. That is unfortunate, but there are good dealers out there, you just need to find them.

To have a nice experience purchasing a vehicle; consumers are expected to shop for a reputable dealer before they can shop for the product they are interested in. The process is a headache. Very few people are excited to buy a vehicle, they are excited to own a new vehicle, not the headache and games that come along with the purchasing process. We all want the best deal on our truck, ordering direct from FoMoCo at least offered some level of price transparency.

Usually buying a new car off the lot is a stupid back and forth negotiation, which sometimes ends with you feeling like you're getting a great deal and the dealer knowing they probably could've conceded more. Yeah, I know I'm jaded towards my current dealer, the back and forth negotiating happened at every other dealer I've bought from too.

Most people don't realize they have a bad dealer until it's too late (such as myself).

 

[USA EV]

Interesting topic.

I've often wondered if Ford didn't start out wanting to use the Lightning to kill electric trucks. (How else can you account for those milky DRLs?) I think they thought the low range would do it. Then at some point they realized they actually had to make a go of it. So it is a half-scuttled business.

The Pro at $40K was a mistake. It's just way too nice. For $40K it needed to be 2 door, RWD, bench seats, with an AM radio. But that would've taken more engineering.

So anyway way too nice and to compound the mistake they actually tried to make the silly thing! Given the mistake they should've just said that'll be out in 2024 and just built the Platinums then the Lariats. Some people would be unhappy, but not as unhappy as they are currently. And if $40K was doable in 2024 the Pro would be undercutting and stealing the thunder of the Ram EV and Cybertruck perfectly as they would be starting with their pricey trims.

On dealerships - not everyone is willing to buy a $75K car sight-unseen. Even Tesla has "stores". Will dealerships evolve into stores + delivery centers + service departments? [Isn't that kind of what they are?] I think their business model will have to evolve as EVs need less service and to your point less sales. Ultimately this could mean less percentage per car, but the Lightning is one of the leaders of this transition, which will take a long time. Can't expect it to be all done right out of the gate. It's part of the price of being an early adopter.

Hey, your feedback is probably helping to shape the future!

 

[F150ROD]

I believe this is year 3 into Fords EV venture? Farley has talked a lot about changes coming with EV only dealers, dealers only being delivery centers etc.

As far as the Lightning, I agree with everything you stated. Yet dealers continue to sale their abandoned orders over MSRP with less features. Basically the dealerships are killing this truck and once that Cybertruck is released it will be RIP Ford Lightning and possible Silverado/Ram.

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