Ford CEO Jim Farley spoke with Car and Driver recently to talk about their desire to move away from dealerships and closer toward a built-to-order system. This follows a difficult year (you know, pandemic and all) that forced dealerships into reduced stock. Instead of pushing production to restore stock, they want to keep it low and promote custom orders.
“We are really committed to going to an order-based system and keeping inventories at 50 to 60 days’ supply.”
Farley expands on his reasoning, explaining that it costs the company more than they need to. Potential profit is lost when dealerships resort to using incentives to push sitting products. And according to Farley, reducing stock quantity can help resolve that.
We’re already seeing some efforts toward this system with things like Ford Express Buy. But with limited options for the service and the option for dealerships to opt in, there’s still more work to be done before it becomes a common idea.