Ford considers fixed prices in Europe, excludes changes in Australia

Ford considers fixed prices in Europe, excludes changes in Australia

Ford’s European division is exploring a move to non-negotiable fixed prices, but the company’s Australian division has reiterated its earlier position that it will continue to give customers the option to be negotiable.

US auto giant ford is considering a move to non-negotiable fixed pricing in Europe, but the changes will not be implemented in Australia.

German publication automobile week Ford of Europe is reportedly preparing to downsize its dealer network and move to fixed pricing over the coming years, starting with the Netherlands in 2024, followed by Germany in 2025.

A spokesman for Ford Australia said drive There are no plans to change the existing business model, which allows potential buyers to negotiate new car prices.

Martin Sander – the chairman of Ford’s German operations – told automobile week it is considering the switch to remain profitable.

“It is crucial for us that our network is profitable in the long term,” said Mr. Sander in an interview with automobile week. “We will not implement the necessary adjustments in a hurry, but will give ourselves five to eight years to do so.”

Mr. Sander’s comments come after an October 2022 report automobile weekin which Ford’s head of business strategy for Germany, Austria and Switzerland – Jörg Ullrich – told the publication that “a single price for each model would simplify the system considerably”.

To date, car retail costs have risen for automakers that have switched to the new business model, meaning customers are worse off under the program.

In June 2022, Ford Australia ruled out launching non-negotiable local sales – although global boss Jim Farley described a potential move to fixed pricing in the US as “the most exciting land grab in our industry since the Model T”.

In September 2022, Dianne Craig, head of Ford’s international markets division, echoed the company’s earlier comments drive: “Regardless of franchise laws or some other restrictions…our dealers are truly our strategic competitive advantage.”

Last month, foreign reports claimed that Dutch automaker Stellantis – which owns automakers such as Jeep, Peugeot, Citroen and Alfa Romeo – plans to switch to fixed pricing later this year, while BMW is following suit with the Mini brand in 2024.

In Australia, Honda became the first automaker to switch from a traditional sales model to fixed local prices in July 2021, while reducing its dealer network from 105 to 90 locations.

Mercedes-Benz Australia introduced non-negotiable fixed pricing in early January 2022, prompting annual sales of its passenger cars and SUVs to fall 5.5 percent compared to 2021 and 27.7 percent compared to its 2017 record.

Jordan Mulach

Jordan Mulach was born in Canberra/Ngunnawal and currently resides in Brisbane/Turrbal. Jordan joined the Drive team in 2022 and has previously worked for Auto Action, MotorsportM8, The Supercars Collective and TouringCarTimes, WhichCar, Wheels, Motor and Street Machine. A self-proclaimed iRacing addict, Jordan finds himself either behind the wheel of his Octavia RS or berating his ZH Fairlane over the weekend.

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