Dealers

As the public face of Ford within our communities, our dealers are key employers and contributors to local economies, especially in rural areas and small towns.

In 2010, we announced plans to expand the Lincoln brand lineup to compete in the luxury marketplace and to discontinue the production of Mercury vehicles in the fourth quarter. In North America, there were no stand-alone Mercury dealerships.

For our Mercury dealers, we provided financial benefit packages in exchange for resigning the franchise. We also supported dealers with special purchase offers on Mercury vehicles to help them sell remaining Mercury inventory.

At our current and expected U.S. market share, we continue to have too many dealers, particularly in some of our largest 130 metropolitan areas. To address this overcapacity, we have been working with our Ford and Lincoln dealers to consolidate and restructure. As part of these efforts, the number of dealers in our Ford and Lincoln network in the U.S. has been reduced from about 4,400 at the end of 2005 to approximately 3,430 at the end of 2010. (For more on our dealer network, see the Economy section of this report.)

Dealer Diversity

Ford Motor Company continues to be a leader in the automotive industry in the percentage of minority-owned dealerships, with 185 (or 5.4 percent) of our 3,430 U.S. dealerships minority-owned at year-end 2010. We continue to work with our minority dealers to provide a foundation for a stronger future for ethnic minorities in all aspects of the industry through the creation in late 2010 of a unified minority dealer group – the Ford Minority Dealer Association (MDA). Our mutual goal is to create sustainable business operations that will promote Ford products and services. The MDA will work to address relevant minority dealer concerns and to provide input to senior management on all aspects of dealership sales and service operations. Working together, we will develop a ONE Ford approach to creating minority retail career opportunities, enhancing existing dealer profitability and viability, identifying multicultural marketing opportunities and improving existing education, training and community involvement.

Dealer Sustainability Program

In 2010, we launched a voluntary sustainability initiative for our dealers to reduce their carbon footprints and improve the energy-efficiency of their dealerships. The goal of the “Go Green” Dealer Sustainability Program is simple: to collaborate with dealers to implement cost-effective ways to improve the energy-efficiency of their facilities. We partnered with the Rocky Mountain Institute, a leading energy-efficiency organization, to pilot new technologies and architectural design principles.

Dealers who choose to participate receive a comprehensive energy assessment from sustainability experts at Ford. After the assessment, Ford and the dealer collaborate on energy-saving options available and tailor a program to meet the specific needs of each dealer.

One dealership, Jarrett Gordon Ford Lincoln in Winter Haven, Florida, recently completed its Go Green sustainability facility project, which focused on ways to reduce the facility’s carbon footprint. Brian Jarrett, president of the dealership, spent more than $500,000 on renovations, including a new hyper-insulated roof that keeps costs down thanks to its white, heat-reflective coating; installation of more energy-efficient cooling systems; and landscaping that requires less watering.

The renovated facility is largely lit by solar tubes that capture natural light. The new roof funnels rainwater to collection barrels for landscaping maintenance, as well as to a 5,000-gallon cistern and filtration system for other non-potable uses, such as car washing. The renovation projects have cut the dealership’s utility bills roughly in half.

Engaging with Dealers

Dealer relations are a key priority for us. The Dealer Council was created as a forum for open dialogue between Dealer Council members and Ford. Through the council process, dealers can voice their concerns, needs and ideas for working more productively as a team. In 2010, we agreed to separate the Ford and Lincoln National Dealer Councils to better focus on the unique priorities facing the Company and dealers. Dealer priorities and Ford management responses are published annually, providing transparency to the discussions between the Company and its dealers.

To ensure that communication lines remain open, Dealer Council members also participate as members of National Dealer Advisory Panels. The current advisory panels, and the topics they address, are as follows:

  • Customer Viewpoint Advisory Panel – customer satisfaction rating system, Viewpoint survey
  • Product Committee – current and future product cycle plan, including lineup, design, styling and color/trim
  • Order Complexity Task Force – reduction of vehicle ordering complexity, order guide simplification
  • Marketing Dealer Advisory Board – vehicle packaging strategy, advertising creative, incentive programs
  • Training Advisory Board – dealership employee training and recognition
  • Parts and Service Manager Advisory Committee – fixed operations programs, including employee recognition/retention
  • Commercial Truck Advisory Board – sales, marketing and product programs
  • Service Marketing Advisory Committee – service marketing strategy and advertising
  • Consumer Experience/Dealer Profitability Committee – enhancing the overall consumer experience and network profitability

The feedback gathered through these interactions has helped us develop various programs, change policies and enhance processes to improve customer handling and other significant elements of the dealers’ businesses.

In addition to the Dealer Councils and Advisory Panels, dealer satisfaction is measured in various ways, including the biannual survey of the National Automobile Dealers Association (NADA), as well as day-to-day interaction with our dealers. Approximately 64 percent of dealers provided feedback through the Summer 2010 NADA survey process, which showed notable improvement in many areas – including some of the highest ratings ever from Ford and Lincoln Mercury dealers. With respect to our Ford dealers, we saw significant positive changes in every overall score. Our dealers rated us more favorably in terms of franchise value, policies and procedures, and people. In fact, the Overall Index Ranking shows Ford dealers moved up two spots and are now included in the Top 5 list of automotive brands.