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Ford reorganized back in March so that their EV business (Model e) is separate from the legacy ICE business (Ford Blue). There was speculation at the time that

Ford reorganized back in March so that their EV business (Model e) is separate from the legacy ICE business (Ford Blue). There was speculation at the time that this was in part free itself of the dealership sales model. The dealers would keep the dying ICE business while the fast growing EV business would start with clean slate. Farley was quoted describing the EV sales model as: > "It's going to be much more efficient, a lot more online. It's going to be a really different model."[1] Obviously this will be very controversial and subject to interference by state legislators who have often protected dealerships. Will be interesting to see this transition. https://insideevs.com/news/571959/ford-dealerships-impacted-ev-ice-split/ https://insideevs.com/news/571959/ford-dealerships-impacted-...

runnerup 4y ago
Huge thanks for this context.
wumpus 4y ago
> Ford reorganized back in March so that their EV business (Model e) is separate from the legacy ICE business (Ford Blue). State legislatures and courts have been smacking down this kind of shenanigan for nearly a century now.
- wumpus 4y ago
  Kinda fun when I get mildly downvoted for mentioning a relevant historical fact.
- mrDmrTmrJ 4y ago
  Not sure why you're being downvoted. Personally, I think theres ~50% chance Ford will have to split into two companies (separate stock ticker etc.) to be allowed to have an EV only, no-dealership, sales model,
norman784 4y ago
Excuse my ignorance, but how I understand is that ICE can't be sold directly to the customers, so that's why dealerships exists (?), so my question is, are EV not regulated or treated differently than ICE?
- dx034 4y ago
  I believe the dealership network exists for historical reasons and car companies can't get rid of them for their existing models. Now's the time to change that using EVs as a reason. But it's something many car manufacturers would've liked to start doing 5-10 years ago.
- rascul 4y ago
  EV are regulated also. See for example Tesla's trouble selling directly to customers in some states. https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes
- jkilpatr 4y ago
  EV are explicitly treated differently. Telsa insisted on it's direct sales model and it was more politically expedient for regulators in many states to carve out an exception to the dealership requirement only for car companies that sell EV's exclusively (only tesla at the time). While I suppose this didn't seem like a huge threat to the car dealership lobby in each state at the time it's clearly come back to bite them and is the main reason Fords Electric vehicle production and distribution is a different 'car company' on paper, so that they can take advantage of legislation designed for tesla.
- adamqureshi 4y ago
  Tesla also points out that its prices are fixed, and its salespeople are paid primarily on salary, not commission. “Customers will never be rushed into a purchase, haggle over the price of the car, wonder if they could get a better deal across town, or puzzle over confusing add-on products, like GAP insurance or rust-proofing.” Back in the 1930s, the car companies established this system so that they could worry about making cars, and the franchises could worry about selling and repairing them. Early on, though, the franchisees lobbied their state governments for protection. They feared, among other things, that the giant car companies could open up their own stores across the street, cut prices, and crush the franchise like a bug. To prevent that kind of abuse, all 50 states passed “dealer franchise laws.” They protected the dealerships in various ways—including barring any car maker from selling directly to consumers. Those laws didn’t foresee the modern era. What they meant, of course, is that “no car company that has franchises can sell directly to consumers.” They weren’t even thinking about companies that don’t have franchises, because there weren’t any at the time. Over the years, Tesla’s legal team has gone from one state legislature to another, pointing out how that rule has become outdated, and suggesting that it get changed. In some cases, they succeeded. In others, though, Tesla is running into a tougher obstacle.
maxerickson 4y ago
Is that an actual legal reorganization of the company that would separate contractual obligations, or is it more of an accounting and reporting thing?
stutsmansoft 4y ago
The dealers brought it on themselves...many of them actively disincentivize EV purchases when you try to buy one. Why? They want to protect that recurring service bay revenue. Oil changes, plugs, belts, etc.
- jsymolon 4y ago
  The ICE is one of the minor items; still needs oil and fluids but are mostly maintenance free for a long while. All of the other components still need maintenance. Tires, alignment, suspension etc.
- sillyquiet 4y ago
  I am not saying this isn't true, but EV's have a set of maintenance requirements too - there are still a lot of mechanical parts - tires, suspensions, doors, etc. Not to mention electronic maintenance but I guess dealerships would have to re-train, re-certify, and re-tool technicians for that
  - _1 4y ago
    Not nearly on the same scale. I've had a Tesla Model 3 for over three years and 25k miles and have had no maintenance done.
    - hesdeadjim 4y ago
      I’ve only had my Y for four months now, but I’ve had this very unexpected feeling towards the car (and any EV). I can only describe it as an amalgamation of clean, elegant, and freeing. While driving there is no engine noise, no unpredictable or delayed acceleration, no need to visit a gas station and have gas drip down the side of the car, and the knowledge that the drivetrain is simple and reliable and isn’t saturated with petroleum products. I’ve owned some very nice BMWs before the Y, and while I greatly miss the suspension performance I can’t imagine going back to ICE.
    - kbos87 4y ago
      Exactly. Tires, wipers, and I’m guessing alignment are the only things the average Tesla owner will ever need to worry about from what I’ve read before I took the leap. The best description of my experience switching to an EV is that it’s been like going from a VCR straight to streaming. It’s fast, convenient, modern, and doesn’t really degrade.

runnerup 4y ago

Huge thanks for this context.

wumpus 4y ago

> Ford reorganized back in March so that their EV business (Model e) is separate from the legacy ICE business (Ford Blue). State legislatures and courts have been smacking down this kind of shenanigan for nearly a century now.

wumpus 4y ago
Kinda fun when I get mildly downvoted for mentioning a relevant historical fact.
mrDmrTmrJ 4y ago
Not sure why you're being downvoted. Personally, I think theres ~50% chance Ford will have to split into two companies (separate stock ticker etc.) to be allowed to have an EV only, no-dealership, sales model,

norman784 4y ago

Excuse my ignorance, but how I understand is that ICE can't be sold directly to the customers, so that's why dealerships exists (?), so my question is, are EV not regulated or treated differently than ICE?

dx034 4y ago
I believe the dealership network exists for historical reasons and car companies can't get rid of them for their existing models. Now's the time to change that using EVs as a reason. But it's something many car manufacturers would've liked to start doing 5-10 years ago.
rascul 4y ago
EV are regulated also. See for example Tesla's trouble selling directly to customers in some states. https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes
jkilpatr 4y ago
EV are explicitly treated differently. Telsa insisted on it's direct sales model and it was more politically expedient for regulators in many states to carve out an exception to the dealership requirement only for car companies that sell EV's exclusively (only tesla at the time). While I suppose this didn't seem like a huge threat to the car dealership lobby in each state at the time it's clearly come back to bite them and is the main reason Fords Electric vehicle production and distribution is a different 'car company' on paper, so that they can take advantage of legislation designed for tesla.
adamqureshi 4y ago
Tesla also points out that its prices are fixed, and its salespeople are paid primarily on salary, not commission. “Customers will never be rushed into a purchase, haggle over the price of the car, wonder if they could get a better deal across town, or puzzle over confusing add-on products, like GAP insurance or rust-proofing.” Back in the 1930s, the car companies established this system so that they could worry about making cars, and the franchises could worry about selling and repairing them. Early on, though, the franchisees lobbied their state governments for protection. They feared, among other things, that the giant car companies could open up their own stores across the street, cut prices, and crush the franchise like a bug. To prevent that kind of abuse, all 50 states passed “dealer franchise laws.” They protected the dealerships in various ways—including barring any car maker from selling directly to consumers. Those laws didn’t foresee the modern era. What they meant, of course, is that “no car company that has franchises can sell directly to consumers.” They weren’t even thinking about companies that don’t have franchises, because there weren’t any at the time. Over the years, Tesla’s legal team has gone from one state legislature to another, pointing out how that rule has become outdated, and suggesting that it get changed. In some cases, they succeeded. In others, though, Tesla is running into a tougher obstacle.

maxerickson 4y ago

Is that an actual legal reorganization of the company that would separate contractual obligations, or is it more of an accounting and reporting thing?

stutsmansoft 4y ago

The dealers brought it on themselves...many of them actively disincentivize EV purchases when you try to buy one. Why? They want to protect that recurring service bay revenue. Oil changes, plugs, belts, etc.

jsymolon 4y ago
The ICE is one of the minor items; still needs oil and fluids but are mostly maintenance free for a long while. All of the other components still need maintenance. Tires, alignment, suspension etc.
sillyquiet 4y ago
I am not saying this isn't true, but EV's have a set of maintenance requirements too - there are still a lot of mechanical parts - tires, suspensions, doors, etc. Not to mention electronic maintenance but I guess dealerships would have to re-train, re-certify, and re-tool technicians for that
- _1 4y ago
  Not nearly on the same scale. I've had a Tesla Model 3 for over three years and 25k miles and have had no maintenance done.
  - hesdeadjim 4y ago
    I’ve only had my Y for four months now, but I’ve had this very unexpected feeling towards the car (and any EV). I can only describe it as an amalgamation of clean, elegant, and freeing. While driving there is no engine noise, no unpredictable or delayed acceleration, no need to visit a gas station and have gas drip down the side of the car, and the knowledge that the drivetrain is simple and reliable and isn’t saturated with petroleum products. I’ve owned some very nice BMWs before the Y, and while I greatly miss the suspension performance I can’t imagine going back to ICE.
  - kbos87 4y ago
    Exactly. Tires, wipers, and I’m guessing alignment are the only things the average Tesla owner will ever need to worry about from what I’ve read before I took the leap. The best description of my experience switching to an EV is that it’s been like going from a VCR straight to streaming. It’s fast, convenient, modern, and doesn’t really degrade.