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Ford nixes Model e dealer program, letting all US retailers sell EVs

Breana Noble, The Detroit News on

Published in Automotive News

All Ford Motor Co. dealerships in the United States will be able to sell its electric vehicles effective July 1 with the automaker's decision to sunset its voluntary Model e certification program.

The change will double the number of U.S. Ford dealers eligible to sell EVs to 2,800. The initiative launched in 2022 required dealers on average to invest hundreds of thousands of dollars in charging stations, training and other equipment to support consumer education and sales and service of EVs. Dealers that didn't make the required investments wouldn't be eligible to sell EVs. The certification requirements attracted a few lawsuits with mixed results nationally.

The program's introduction was amid a "COVID spike" in demand for EVs as a global microchip shortage held up production of vehicles at automakers like Ford, while EV manufacturer Tesla Inc. had a more steady supply, representing a larger percentage of the vehicle market, said Marin Gjaja, chief operating officer of Ford's Model e EV business division. As production of internal combustion engine vehicles has ramped up again, EV sales haven't grown as quickly as expected while customers remain wary of their price, access to charging stations and how an EV will affect their lifestyle.

"We're getting into the tough innings," Gjaja said. "We're getting into the early majority customer who isn't in it just for technology and willing to pay a premium. They want a practical, usable vehicle. They have questions they need to really understand the value for them. And it's just a very different sale. ... We need Ford and our dealers pulling together to help bring the market along."

The decision will mean 90% of Americans live within 20 miles of a Ford dealership that can sell and service F-150 Lightning trucks, Mustang Mach-E SUVs and E-Transit commercial vans, Gjaja said. Deploying EV inventory to dealers that weren't participating in the Model e program will happen over the coming weeks and months.

Ford will require its dealers to install two Level 2 charging stations by March 31, 2025, to sell EVs and have their employees participate in EV training. Gjaja says these charging stations that are not fast chargers and can cost around $10,000 each with installation, though additional investment may be needed if electrical upgrades are required.

"We want to make sure our dealers and our customers are safe and secure," he said. "There's some need to make sure there's proper training both for sales consultants and for service people if they're going to work on EVs or sell EVs."

Gjaja expects EV sales to increase as a result of the decision. Ford EV sales are up 88% so far this year. He said that since the company rolled out the Model e dealer program, the manufacturer's suggested retail prices of EVs have fallen 30%, automakers have coalesced around Tesla's North American Charging Standard, and Ford has launched its new artificial intelligence-powered, interactive, video-based Ford University training platform for dealer employees.

 

The Dearborn automaker last month recommended that Model e dealers halt investments related to selling EVs. It had set a June 30 deadline for dealers to have invested in Level 2 EV charging stations to qualify for the certification to be able to sell EVs. The company had eased requirements in November, but Ford since has continued to announce changes to its all-electric programs, including delaying the launch of a three-row SUV by two years. The automaker has delayed $12 billion in EV-related spending as a result of slowing EV sales growth. Its Model e business division expects to lose up to $5.5 billion in 2024.

In December 2022, Ford said two-thirds of dealers had signed up for the EV charging program. That's fallen to half.

Moving in response to market conditions, dealer feedback, supply chains and infrastructure delays, the automaker in November said for dealers to be "certified" in the EV program, they had to have two Level 2 chargers, down from five, by the end of next month. To be "certified elite," the standard fell to three instead of five and a requirement from a "Level 3" fast charger for 2026 was removed. The company also reduced employee training requirements.

Ford originally had estimated the cost of the certified elite program at $1.2 million for its retailers, but on average the investment was closer to $600,000, Gjaja said. For certified dealers, the investment on average was $450,000. Gjaja said the company will have to work through any issues that arise from retailers who've already made those investments.

The rollback of the Model e program comes after Ford executives completed a "Dealer Engagement Tour," hearing from more than 1,000 dealers over 11 meetings across the country.

"There's always a learning curve with the new technology, and introducing EVs in a simple, hassle-free way," Gjaja said, "helps remove any of the perceived barriers, whether it's for our dealers or customers and the concerns that they have."


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