11:33 am, March 2, 2023
Ford is set to slash its European dealer network as the Blue Oval puts the finishing touches on its plans for agency sales.
Car Dealer reported before Christmas that the firm was looking to change to a direct-to-customer approach in order to establish a ‘long-term relationship’ with drivers.
However, very few details were given about the nature of the switch, apart from the fact it would be based on a pilot scheme being set up in the Netherlands.
Ford of Europe boss Martin Sander has now told Autocar that the company’s first agency site will open in the Netherlands later this month.
The rest of Europe – including the UK – will eventually follow suit, although no timeframe has been given for the process.
It is also expected to result in a huge reduction in the number of dealerships throughout Europe.
Sander told Autocar that the reduction is down to a number of factors, including more and more buyers switching to purchasing cars online.
Earlier this week, one expert told Car Dealer that online-only sales are ‘unrealistic’ as buyers still wanting to see a car before purchase.
Automotive lawyer Iain Larkins also said that it remains ‘unclear’ whether agency sales will ever be profitable for dealers.
That is not an opinion shared by Sander though, who told the magazine: ‘Agency is definitely the way to go. We’ve decided that we are going to switch to the agency model in Europe over the next years,’
‘This is nothing you can do overnight in the whole of Europe,’ he added. ‘We see that more and more customers want to buy online: just click and buy or lease a vehicle. But we also expect, because of our switch to electric vehicles, that service revenue might go down in the long run.’
His thoughts echo similar comments by Tim Slatter, chair of Ford in Britain, back in December.
Speaking at the firm’s Halewood plant in Liverpool, he told Car Dealer: ‘The reality is that, for next generation full electric vehicles, almost the whole industry changes.
‘The way we design these products changes, the way we develop and sign them off changes and the way that we go to market will change as well.
‘One of the most important things for these connected vehicles is for us to have a much more direct and long-term relationship with our customers and we will seek to do that through a go to market strategy which will allow us to have a direct relationship.
‘That is just part of how the whole industry for electric vehicles changes. We want to move from a short-term transactional relationship with our customers to a much longer-term relationship with them.’
A Ford of Britain spokesman told Car Dealer: ‘We are constantly assessing and optimising our retail network to ensure that we provide the best possible experience for the customer, based on the channels they choose to use, and a positive business equation for our partners.’
Car Dealer Live – the future of the car dealer – exclusive conference features talks from leading car dealers, Google and Auto Trader among much more. Find out the full event details and book tickets.
