2 MINUTES AGO: Every Ford Dealership Will Be SHUT DOWN!

I think, uh, the most important thing is going to be the platform. Now, this has kind of been an epiphany for me, uh, because I first thought, as a consumer guy, I thought, well, you know, if we just find the right set of applications and people just see the value in that, then we're on our way. Every Ford dealer will be shut down, and the crazy part is there is no support coming from Ford.

See, this giant company is struggling, and it is so bad that, at this point, Ford is letting it happen. But don't be fooled; this is not something they want. They are just adapting, and it is part of survival.

But in order to understand why all of this is happening, we need to talk about how we got here in the first place. So, what's going on? Ford Motor Company, a name that's been synonymous with the automotive industry for over a century, is facing some serious hurdles as the market undergoes rapid changes.

These challenges aren't just minor bumps in the road; they're significantly impacting Ford's market position and leading to the unfortunate closure of several dealerships. So, what's the game plan? Right now, Ford needs to tackle four major questions that could shape its future.

Let's dive into the most pressing one first. One of the key issues is the decline in sales. It's like a wake-up call for the company, highlighting that some loyal customers might be exploring other options or switching to different brands altogether.

As consumers are becoming more discerning, Ford has to catch up to these trends or risk being left behind in the dust. But how bad is it, exactly? Ford has been part of American culture for a very long time, but right now, Ford's cars are not moving off the lots, meaning nobody wants them, especially their beloved trucks, which have always played a vital role in keeping the company on top of the automotive game.

Thinking about this, let's zoom in on the numbers. From July 2024, Ford reported a drop of nearly 3,500 units compared to July of the previous year. That's quite a hit.

If we look at the bigger picture, Ford's total drop in vehicle sales over the first seven months of 2024 has exceeded a staggering 19,000 units. This adds up to a jaw-dropping 23% decrease in sales year to date. To put it bluntly, Ford's market share has taken a nosedive, now sitting at a lowly 5.

6%. That is down from 7. 7% just a year ago and a further drop from a pre-pandemic high of 10.

2% back in July 2019. Competitors like Chevrolet and GMC have been quick to take advantage of Ford's struggles, and the results are speaking for themselves. While Ford grapples with falling numbers, the overall new car market is enjoying a pleasant 5.

5% boost year on year. This shift suggests that consumers are finding new brands that align better with their current preferences and needs. The struggles do not stop at corporate headquarters; they are spilling over to Ford dealerships across the country, and it is pretty serious.

As of 2024, about 10% to 15% of Ford dealerships are reportedly in financial trouble. When you crunch the numbers, that means around 300 to 450 out of approximately 3,000 dealerships nationwide are teetering on the brink. And guess what?

It is not just about dwindling sales. Rising interest rates and climbing operational costs are making things even tougher. Experts predict that if sales do not pick up soon, we could see between 150 to 300 dealerships possibly shutting their doors in the next one to two years.

This is a real blow, not just for the dealerships struggling to stay afloat, but also for the overall image of the Ford brand and its connection with loyal customers. Adding to the woes, a recent survey throws more light on the situation. Nearly 46% of Ford dealers admitted to feeling a complete lack of trust in their franchise.

Why? The ongoing issues regarding electric vehicle transitions and worries about profitability are major red flags. This sentiment isn't just a minor hiccup; it shows a more widespread concern among dealers feeling left in the lurch as consumer preferences continue to evolve alongside economic challenges.

When looking at specific Ford models, the numbers tell a troubling tale as well. Take the Ford Edge, for example; it has encountered a sales decline of about 15%. Why?

Its higher price point, combined with fierce competition from fuel-efficient rivals like the Hyundai Santa Fe, is making it tough to attract buyers. Then there's the Ford Escape, which has experienced a 12% drop in sales, even after some recent updates. It seems to be getting lost in a sea of compact SUVs, struggling to distinguish itself in an increasingly crowded space.

And let's not overlook the iconic Ford Mustang. This legend has seen a roughly 10% fall in sales, particularly in higher trim levels, as consumers seem to be gravitating more towards the SUVs and electric vehicles currently dominating the market. These challenges highlight a critical need for Ford to pivot its strategies and tackle bustling market conditions, along with ongoing dealer concerns, if they wish to reclaim their place in the ever-competitive automotive arena.

And this is the second thing that they need to figure out: value versus profit. Have you noticed how car prices have skyrocketed lately? Well, you're not alone.

This is a hot-button issue that's got shoppers all fired up, and for good reason. According to the latest data, the average transaction price for a Ford vehicle has hit a whopping $48,000 as of 2023. That is a significant jump compared to the industry average of around $45,000.

This growing price sensitivity is really playing a major role in consumers' buying decisions. In fact, a staggering 60% of potential Ford buyers are willing to pay a premium for. .

. Eco-friendlier options, but here's the kicker: many of them view Ford's electric vehicle lineup as being on the pricier side when compared to competitors like Tesla and Chevrolet. These other brands have really stepped up their game, offering models that are much more wallet-friendly.

Take the Chevy Bolt EV, for instance; it starts at just $26,500, making it a much more manageable choice for those who are keeping a close eye on their budgets. If Ford doesn't adjust their pricing strategy soon, they could easily lose market share to these more affordable alternatives. But that is not all.

Ford's troubles don't end there. Turns out, they're not only making overpriced cars, but also ones that tend to break down quite easily. Yep, quality concerns have seriously shaken consumer confidence in the Ford brand.

In 2023 alone, the company had to deal with over 20 major recalls affecting hundreds of thousands of vehicles due to a variety of issues, like engine failures and safety problems. And the numbers do not lie. According to the American Customer Satisfaction Index, Ford's satisfaction score was a measly 77 out of 100 in 2024.

While that shows a small improvement from previous years, it is still way behind industry titans like Toyota and Honda, which consistently score above 80. To make matters worse, surveys indicate that a whopping 46% of Ford dealers do not even trust the franchise's ability to turn a profit in the future. Talk about a red flag!

Ford has also been struggling with some serious technological challenges. Now, don't get me wrong; they've definitely made strides in equipping their vehicles with fancy infotainment systems and driver assistance tech. However, the flip side is that many consumers find these features overly complicated.

In fact, a recent survey revealed that a staggering 42% of respondents felt completely overwhelmed by the tech in their cars, particularly when it came to the user interface and connectivity issues. This level of complexity can be a real turnoff for potential buyers who are just looking for something simple and intuitive. And let's not forget about the anxiety surrounding Ford's push into the electric vehicle market.

A whole new set of technological concerns has emerged, like worries about battery life and the availability of charging stations. In fact, a whopping 70% of consumers expressed apprehension about whether they'd be able to find charging points during longer road trips. That's a valid concern that could seriously deter those who are considering making the switch to electric.

That's a lot to take in, isn't it? But the bottom line is that Ford has some serious work to do if they want to regain the trust and confidence of their customers. From overpriced and unreliable vehicles to tech that leaves consumers feeling overwhelmed, the brand has some major hurdles to overcome.

But hey, if anyone can turn it around, it's the folks at Ford. After all, they've been making iconic cars for decades, and I'm sure they've got a few tricks up their sleeves. They just need to make adjustments to their plans.

But what are they doing instead? They are diving headfirst into the abyss, which brings me to the next reason: the transition to EVs. Ford's electric vehicle division, Model E, is one of the most struggling things in the market right now.

Now, watch carefully, because the numbers we're about to uncover are nothing short of jaw-dropping. Let us begin with the financials. In 2023, Model E racked up a staggering $4.

7 billion loss in earnings before interest and taxes (EBIT) on a measly 116,000 electric vehicles sold. Can you believe that? It works out to an average loss of a whopping $4,525 for each and every electric vehicle they moved off the lot.

Ouch! And if that was not bad enough, things only got worse. In early 2024, the losses deepened even further, hitting a mind-boggling $1.

3 billion in just the first quarter alone. That is a loss of $132,000 per vehicle for the 10,000 electric vehicles they managed to sell during that period—a 20% drop in sales volume compared to the same time last year. And to top it all off, revenues plummeted by a whopping 84% to a mere $100 million.

All of this was largely due to major industry-wide price cuts as brands tried to stay competitive. But wait, there's more: analysts are warning that the annual losses could even double by the end of the year. Yikes!

This is one tough spot Ford's found itself in. And let's just be honest: even though the US has made great strides in building out over 150,000 public charging stations, accessibility is still a mixed bag. Many consumers are still worried about range anxiety and whether they'll be able to find a charging point when they need one.

This is a major roadblock that Ford needs to tackle head-on. The solution? Forging partnerships with charging network providers and investing heavily in infrastructure development.

It's essential to allay consumer concerns and instill confidence in the shift to electric vehicles. I know that's a lot to take in, isn't it? When you piece it all together, it's clear that Ford is at a real crossroads as it navigates the transition to electric vehicles.

But the most deadly of these challenges is the competition in the EV market because of one major thing: price wars. The electric vehicle price war is heating up and transforming the landscape of the automotive industry right before our eyes. This vigorous competition isn't just about who makes the best car anymore; it's a real free-for-all among manufacturers desperate to grab a larger slice of the exploding EV market.

It all kicked off when major players like Tesla and BYD began slashing prices dramatically. Their goal? To entice more buyers and fend off rivals.

Now, other brands like Ford are feeling the pressure to follow suit. Initial price reductions are where this. .

. War truly began. Tesla took it to another level with aggressive pricing that significantly cut the costs of its entire lineup.

By doing this, Tesla not only aimed to hold on to its position as the market leader, but also wanted to make its cars more accessible to a wider audience. They recognized that buyers are increasingly looking for affordable options packed with value in the burgeoning EV market. But now, Chinese manufacturers have stepped into the fray, making quite the impact with their competitive pricing.

Companies like BYD and MG have slashed prices on their models, with some vehicles now retailing for less than $35,000. This strategy is smartly designed to help these manufacturers expand their international presence while also tackling domestic market issues like overcapacity. They realize that to succeed on the global stage, they need to make their cars irresistibly affordable.

So, what's happening in the market? We're seeing a larger trend emerge where consumer demand for electric vehicles is beginning to soften. This shift has led automakers to adjust their strategies, offering prices that are more competitive than ever.

Although analysts point out that these decreases may provide a short-term sales boost, they might pose significant long-term challenges for profit margins across the board. It's a tricky balancing act for sure. Now, let's talk about Ford and how they're handling all this price-cutting action.

In response to the evolving competitive landscape, Ford has jumped into the fray by announcing some hefty price cuts on its Mustang Mach-E models. We're talking reductions of up to $8,100 across certain trims. This bold move is all about making these vehicles more enticing for budget-sensitive consumers and ensuring Ford remains a serious contender against Tesla and the rising tide of Chinese brands.

Yet, it's not just about growth in sales. Ford is trying to find the perfect balance between boosting sales and maintaining profitability. They understand that to keep their market share steady amid such fierce competition, they must adapt to what consumers want, which right now leans towards lower-priced options.

However, while these price drops may draw in buyers, they also raise concerns about how this approach will affect profit margins in the long run. The financial landscape for Ford is complex, too. Rising production costs and supply chain issues are complicating their financial outlook as they try to navigate this aggressive pricing strategy.

To make things even more attractive for buyers, Ford is not just cutting prices; they're also rolling out various incentives—think leasing, cash credits, and federal tax credits—designed to make owning an EV much more appealing. This strategy reflects a savvy understanding of changing consumer priorities, where economic feasibility is becoming increasingly important. As this electric vehicle price war unfolds, we are witnessing a crucial moment for automakers like Ford.

They need to continually adapt their strategies to stay afloat in this crowded market, and that is what they did. What's their plan? Let's break it down.

Back to the drawing board—see, Ford knows what they are up against is a giant obstacle. So, here's the deal: Ford has set its sights on a lofty goal. By the end of this decade, they want to have a hybrid version of every single vehicle in their Ford Blue lineup available in North America.

Why, you ask? Well, it's not just about giving people more choices; it's all about creating a smooth transition from those gas-guzzling cars to the fully electric vehicles of the future. Ford is tapping into the growing trend of eco-conscious driving, but they're also making sure to cater to those who aren't quite ready to take the plunge into full electrification just yet.

And get this—they've got some pretty impressive plans up their sleeves. Ford recently announced that they're working on a brand new line of electrified three-row SUVs that are going to pack some serious hybrid tech. These babies are designed to not only boost efficiency and performance but also slash down those pesky emissions compared to your typical gasoline-powered rides.

Oh, and they're also aiming to solve that range anxiety problem that a lot of drivers have been dealing with when it comes to EVs. With these electrified SUVs, you can say goodbye to constantly searching for charging stations on your family road trips. Talk about a win-win!

But that might never happen. Turns out, the high production costs and the rapidly changing market landscape made them rethink their strategy. And get this: the cost of batteries can represent a whopping 40% to 45% of a vehicle's total price.

No wonder hybrids are looking like the more appealing option, especially for those larger SUV models. But Ford's not the only one making these kinds of adjustments; the whole automotive industry is seeing similar trends. General Motors, for instance, is also dipping their toes into the hybrid waters, getting ready to roll out hybrid versions of their top-selling models.

And you know what? This hybrid approach actually plays to Ford's strengths. They can take advantage of their existing manufacturing capabilities, ramp up production without having to completely overhaul their processes, and then gradually make the big leap toward full electrification as the technology keeps advancing and consumers become more comfortable with going electric.

So, as Ford navigates these shifting consumer preferences and the intense competition, their hybrid strategy is shaping up to be a pretty smart move. It's like they're saying, "Hey, we hear you loud and clear! " They're positioning themselves to meet those consumer demands while still making meaningful steps toward a more electrified future.

Who knows? This could be the secret sauce that secures Ford's spot in the ever-changing automotive landscape. What do you think?

Is this hybrid pivot the way to go? But now, let's talk about the fourth part, and an issue that even switching to hybrids won't solve: the fight against dealers. Ford is currently navigating a rocky relationship with its dealerships.

And this friction largely stems from a mix of operational hurdles and shifting market dynamics. One major concern is the challenge of effectively selling its electric vehicle models, especially the much-anticipated F-150 Lightning. Although this truck boasts an attractive design, dealers are struggling to drum up interest among customers.

They are reporting low demand, largely due to worries about the availability of charging infrastructure and the overall practicality of EVs for commercial usage. For instance, one dealer shared that even with the truck's sleek looks, it's tough to move them off the lot. As a result, Ford has had to announce reductions in production shifts for the F-150 Lightning.

The situation is piling even more pressure on dealerships, which are already wrestling with inventory management and trying to keep up with customer expectations in an industry that's changing rapidly. But the tension doesn't stop there. The bond between Ford and its dealerships has been further stressed by issues surrounding service and warranty fulfillment.

Many customers have voiced their frustrations regarding their experiences at Ford dealerships. Often, they mention poor communication and insufficient support when it comes to repairs or warranty claims. Reports indicate that some dealerships aren't providing the level of service that customers expect, leading to dissatisfaction and potentially tarnishing Ford's overall reputation.

As dealerships attempt to handle these hurdles while also trying to promote new EV models, the disconnect between Ford's corporate strategies and the realities at the dealership level could make tensions rise even higher. You see, it's not just about selling the shiny new electric trucks; there are a whole host of logistical nightmares that Ford and its dealers are grappling with—from getting customers excited about EVs to ensuring a seamless service experience. With the rapid changes sweeping through the industry, it's become a real balancing act for everyone involved.

Imagine being a dealership trying to juggle inventory, customer expectations, and the latest corporate directives, all while dealing with skeptical buyers who aren't quite convinced about the practicality of electric trucks. It's no wonder the relationship between Ford and its dealers is feeling the strain. So, in a bold move to adapt to the evolving EV landscape, Ford is planning to shift towards a direct-to-consumer (DTC) sales model.

This strategy aims to streamline the sales process, lessen their dependency on traditional dealerships, and engage customers more directly. You see, as Ford aspires to expand its EV offerings—including both wallet-friendly models and advanced commercial vehicles—this change is particularly essential. As part of this bold strategy, Ford is enhancing its online sales channels and aiming to strengthen its digital presence.

This shift could lead to improved pricing control and a better overall experience for customers shopping for electric vehicles. Imagine being able to browse, customize, and even complete your EV purchase from the comfort of your own home. No more haggling with salespeople or wasting time at the dealership.

Sounds pretty sweet, right? But let's not overlook the concerns that this DTC approach has sparked among dealerships. Many dealers are worried about what their role will be in the sales process moving forward and how this change could potentially hurt their revenue.

There's a real fear that sidelining them from the sales equation could undermine their business models, especially considering they've invested significantly into showrooms and customer service. Additionally, dealers worry about how their relationship with Ford might evolve. If they feel that their power over pricing and inventory management is dwindling, it could complicate things even more.

As Ford navigates this transition, striking the right balance between the interests of dealerships and establishing a more direct connection with consumers will be essential to avoid stirring the pot too much within its distribution network. This is a high-stakes game, folks. Ford is trying to revolutionize the way people buy their electric vehicles, but they can't afford to alienate the very dealers who have been the backbone of their business all these years.

It's going to take some serious negotiating chops and a whole lot of creative problem-solving to make this DTC shift work for everyone involved. You see, Ford's push for a direct-to-consumer sales model has stirred up quite a storm within their dealership network. These dealers are rightfully concerned that this transition could significantly compromise their well-established roles and revenue streams.

After all, the DTC approach aims to streamline costs by reducing the need for extensive inventory and traditional sales processes. But for the dealers, this represents a real challenge as they fear losing their influence over pricing and customer relations. Adding to the dealers' frustration is Ford's new two-tiered EV sellers certification program.

This program requires them to heavily invest in infrastructure, including the installation of charging stations. For many dealers, this represents a significant financial burden, especially for those who may not have the resources to comply with these new standards. It's left some feeling pressured to rapidly adapt or risk being left behind in Ford's evolving sales framework.

So, it doesn't take a genius to know that as these sweeping changes unfold, some Ford dealers are sounding the alarm about the feasibility of the DTC model, particularly in light of the current struggles with selling electric vehicles like the F-150 Lightning. With Ford cutting back on production shifts due to declining demand, dealers find themselves in a precarious position. They're now tasked with the challenge of selling these new EV models while simultaneously adapting to a potentially diminished role in Ford's upcoming sales strategy.

This complex situation underscores the wider challenges faced by traditional dealerships in an era where automakers are pushing for more modernized sales approaches. The tension between these competing visions of the automotive industry is palpable, and its resolution will undoubtedly shape the future landscape of how we purchase our vehicles. As the dust settles, one thing is clear: the transformation underway is not just about the cars themselves, but about the entire ecosystem that supports it.

The automotive experience—what are your thoughts on this? Let us know in the comments. Thanks for watching, and I will see you in the next video!