Ford said that it wants to restructure its dealership model to sell its EVs online only and at a non-negotiable price to match Tesla’s profit margins.
“I feel like when that second quarter last year profit came out for Tesla and they showed like a $15,000 premium, it totally changed my world,” CEO Jim Farley said at the Bernstein Strategic Decisions Conference on Wednesday. “It was an epiphany. It was like the angels sung, it was like, ‘Oh my god, we can make more money on EVs than our ICE.’”
Farley’s comments in a lengthy interview came one day before the automaker announced it would spend $3.7 billion to hire 6,200 union workers to staff several assembly plants in Michigan, Ohio and Missouri in a bid to sell 2 million EVs a year by 2026.
Farley said he expects massive consolidation among dealers, suppliers and automakers as the industry begins building more EVs. His comments come at a precarious time for car prices due to the supply chain crunch and instances of dealerships gouging customers for new vehicles.
In the future, dealers won’t hold any inventory, he added. Instead, the vehicles will ship directly to the customer, with remote pickup and delivery.
“Their business will change a lot,” Farley said. “There will be a lot of winners and losers, and I believe, consolidation.”
He did not give a timeframe for the shift to online sales or elaborate on Ford’s plans for its dealer network.