Join Date: Feb 2001
Location: The Hills of North Georgia,USA
Ford to keep Blue Oval until '05
By Mary Connelly
Automotive News / December 11, 2002
By year end, Ford Division is expected to announce that its Blue Oval dealership certification program will remain intact through March 2005, which means certified dealers will continue to receive 1.25 percent of the base sticker price of each new vehicle. Then the controversial program will be dropped.
Steve Lyons, Ford Division president, who last month proposed cutting payments but keeping the program, is doing a U-turn in the face of dealer protests.
Ford Division wants to reduce or eliminate Blue Oval payments because the financially ailing automaker said it could no longer afford to spend $700 million annually on the certification program.
But dealers don’t want Ford to abruptly scale back the payments because many retailers upgraded stores and made other investments to obtain certification when the program began in April 2000. Now, dealers rely on the Blue Oval payments, which the automaker says average $293 per unit.
In November, Lyons had proposed cutting Blue Oval payments to dealers by 60 percentin three years.
“The (revised) proposal incorporates the feedback we have received in the past few weeks and addresses many issues raised by our dealers,” Lyons said in a prepared statement.
Ford Division also is expected to reduce vehicle invoice prices 1 percent when Blue Oval is discontinued. When Blue Oval was introduced, it included a 1 percent increase in dealer invoice price. Certified dealers received a payback of 1.25 percent of base sticker price.
Lyons’ plan to gradually reduce Blue Oval payments outraged retailers who viewed the 1 percent as dealers’ money. If the Blue Oval payments had been reduced to 0.5 percent of the sticker, as Lyons originally proposed, that would be a net loss to dealers.
Ninety-five percent of Ford Division's nearly 4,000 dealers are Blue Oval certified.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....