Ford Division wants to know when a dot-com company seeks to acquire a dealership franchise.
When possible, Ford will step in, temporarily buy the open point and award the franchise to a buyer deemed more suitable, Ford says.
Ford is not asking outright that a selling dealer turn down a dot-com company's purchase offer. But Ford is asking dealers to help it prevent dot-coms from acquiring franchises. Like other automakers, Ford fears that a dot-com company could use the acquisition of a vehicle franchise as a springboard to direct selling on the Internet.
DISCUSSED WITH DEALERS
'We talked to our dealers about this,' Ford spokeswoman Anne Doyle said. 'We want the opportunity to evaluate a potential buyer. We want a selling dealer to possibly give us the opportunity to buy the point. We will not buy the point to own it but to put in the strongest candidate.'
Ford raised the issue during its meeting with dealers at the National Automobile Dealers Association convention last week.
Ford policy does not prohibit dot-coms from buying a franchise, Doyle said. State franchise laws would be unlikely to permit such a ban, she said.
But Ford routinely invokes three criteria to evaluate - and possibly veto - potential franchise buyers. Ford judges a buyer's financial resources, the dealership facility's ability to support the projected business plan and the individual's character.
GIVE US A CHANCE
A dot-com company that intended to do business beyond a designated selling area would be scrutinized, Doyle said.
'We would question their ability to provide service for the vehicles and to develop the customer relationships necessary to achieve strong owner loyalty,' Doyle said. 'These are considered in deciding potential owners.
'We did say to the dealers: `When you are approached, keep in mind the possibilities. What are their plans for the dealership? Give us the opportunity to buy it,' ' Doyle said.
DEALER COUNCIL OPPOSITION
The Ford Division National Dealer Council opposes dot-coms owning Ford dealerships.
'We feel they cannot service the customer long term in the manner that they deserve,' said Jerry Reynolds, council chairman and owner of Prestige Ford in Garland, Texas.
Ford also is exploring ways to limit vehicle allocation if a dot-com buys a franchise and begins Internet selling, Reynolds said.
For example, the automaker could mandate that a certain percentage of dealership sales occur within the primary selling market. Reynolds said that only sales occurring in the primary market would generate new-vehicle allocation.