August 17, 2022

Ford advises dealerships to not apply markups to F-150 Lightning customers

Ford advises dealerships to not apply markups to F-150 Lightning customers
Ford advises dealerships to not apply markups to F-150 Lightning customersFord advises dealerships to not apply markups to F-150 Lightning customers

Ford has sent out an internal memo to all dealerships in the United States and Canada, advising sales staff to not apply dealership markups to customers ordering the new, all-electric F-150 Lightning.

In December, we reported that Ford was preparing to open the order bank for the F-150 Lightning in January. Essentially, this gives those who pre-ordered the truck with a deposit last year the opportunity to configure the trucks they will drive. They will choose everything from trim options and add-ons, to colors and interior designs.

With the order bank opening and customers getting ready to finalize their orders, Ford is advising dealerships to not apply any adjusted dealership markups (ADMs) to these vehicles, as it is impacting customer satisfaction.

“It has come to our attention that a limited number of dealerships are interacting with customers in a manner that is negatively impacting customer satisfaction and damaging to the Ford Motor Company brand and Dealer Body reputation,” Andrew Frick, VP of Sales for Ford’s U.S. and Canadian operations, said. “Examples of these negative interactions include demanding that customers who are already on the reservation list for the 22 MY F-150 Lightning make additional deposits or payments. These actions are perceived as threatening customers by withholding their opportunity to convert registrations to orders.”

The internal memo was shared by Peter P. on the F150Gen14 forums.

Ford has been one of several automakers to apply hefty dealership markups to some vehicles in 2021 as the semiconductor shortage raised on. Some automakers applied up to $50,000 of additional charges on a vehicle, taking advantage of the low inventory but high demand for cars that affected many consumers and companies last year.

“This behavior is not allowable under Paragraph 6 of the Sales and Service Agreement. Paragraph 6 (i) states that ‘The Dealer shall conduct DEALERSHIP OPERATIONS in a manner that will reflect favorably at all times on the reputation of the Dealer, other Company authorized dealers, the Company, or COMPANY PRODUCTS and trademarks and trade names used or claimed by the Company or any of its subsidiaries. The Dealer shall avoid in every way any ‘bait’, deceptive, misleading confusing, or illegal advertising or business practices,” the memo from Frick to Dealerships said.

Ford doubles its F-150 Lightning production target again to 150k units per year

Additionally, Ford is offering some dealerships the opportunity to include a No-Sale Provision in the legally binding sale contract. This would prevent the re-sale of 2022 F-150 Lightning vehicles, and Ford is offering support to dealerships that can be included in a contract at the time of purchase.

Ford will begin deliveries of the F-150 Lightning in the Spring.

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Ford advises dealerships to not apply markups to F-150 Lightning customers