Ford Motor Co. of Canada and its sellers are in negotiations to find out how a lot particular person sellers should make investments earlier than they’ll promote and repair electrical autos starting in 2024.
Ford has informed sellers they need to resolve by Dec. 16 whether or not they may enroll within the Licensed Elite program or Mannequin e Licensed program, which can start in 2024. Licensed Elite sellers may have precedence entry to EVs, whereas Mannequin e Licensed sellers will “deal with possession and charging with restricted built-to-order gross sales,” a Ford spokesman mentioned. Sellers who don’t enroll in both program shall be restricted to promoting inside combustion engine (ICE) and hybrid autos, as of Jan. 1, 2024.
Sellers who choose out of the EV investments may have one other alternative to take part in 2027. There are 440 Ford dealerships throughout Canada.
A Ford spokesman estimated that sellers face an funding price of roughly $1.3 million to enroll in Mannequin e Licensed Elite program and about $560,000 to enroll as a Mannequin e Licensed seller.
However some retailers say there’s pushback from smaller and rural sellers, who really feel the funding is simply too giant in markets the place gross sales of EVs are nonetheless restricted. Canadian sellers and the corporate are working by way of the Ford Sellers RoundTable Affiliation to resolve the considerations, sellers informed Automotive Information Canada.
Mike Herniak, head of the Ford Sellers RoundTable Affiliation, mentioned he was certain by confidentiality agreements to not focus on the state of negotiations. However some sellers are balking on the measurement of funding required by Ford, significantly in markets the place EV gross sales are tepid.
“I don’t see a giant demand in our space,” mentioned Cliff Lafreniere, seller principal of Pinewood Park Motors in Peterborough, Ont. “I get two or three inquiries a yr. I’ve offered one EV – an [F-150] Lightning.
“The quantity of the funding is absolutely the difficulty.”
Vaughn Wyant, CEO of the Wyant Group in Saskatoon, Sask., mentioned he has heard of pushback from a number of sellers over the funding Ford is looking for from its retailers. “I don’t suppose sellers are enthusiastic about their [Ford’s] first place.” His firm owns two Ford dealerships, in Prince Albert and Saskatoon.
“It’s going to be actually powerful for rural sellers,” he mentioned. With restricted charging services all through Saskatchewan and no provincial buy incentives, “Electrification goes to be slower to come back to quite a lot of rural sellers.”
The stress to amend this system displays sturdy blowback in the USA. Ford not too long ago introduced it will lengthen the unique Oct. 31 deadline to Dec. 2 for U.S. sellers to resolve on participation after receiving sturdy objections to this system.
The Virginia Vehicle Sellers Affiliation despatched a letter to Ford CEO Jim Farley and different executives in October asking them to rethink this system and revise the foundations, in keeping with sibling publication Automotive Information.
Individually, a bunch of executives, representing seller associations in Virginia and 11 different southern states, in late October requested Ford to “rethink the Ford Mannequin e program as it’s presently described,” saying it “consists of unreasonable restrictions on seller autonomy.”
In the meantime, some bigger seller teams in Canada say they’re ready to make the funding Ford is looking for.
“I don’t actually have an issue with them [the programs], in any respect,” mentioned Steve Chipman, CEO of the Manitoba-based Birchwood Auto Group, which operates three rural Ford dealerships within the province and one Ford dealership in Winnipeg.
Though Chipman mentioned there isn’t a assure that investing within the EV infrastructure will assure extra enterprise, the funding is the price of proudly owning a franchise. As Birchwood renovates its varied shops, it installs the wiring wanted to produce quick chargers, even when the automaker doesn’t but require it, he mentioned. Birchwood has 24 dealerships, representing 22 manufacturers.
Chipman mentioned he’s sympathetic to different sellers, particularly smaller ones, who’ve considerations over the fee as a result of circumstances for every dealership differ.
“Ford must be open-minded,” Chipman mentioned. “One measurement doesn’t match all.”