Ford Division's controversial Blue Oval dealer certification program already is proving its worth, according to Jim O'Connor, division president.
Customers have been giving Ford Division dealerships higher grades in selling and servicing vehicles since the certification program started last year, he said. High grades are necessary for dealers to achieve Blue Oval certification and certain financial rewards.
Ford will continue its campaign to certify dealerships despite legal challenges and some dealer unrest, O'Connor said.
'In calendar year 2000 our customer satisfaction scores went up seven points in sales and one point in service year over year,' he said. 'We are pleased with the initial progress to date, but we certainly have a long way to go.'
Last April, Ford said it would begin rewarding top-performing, or Blue Oval, dealerships. So far, 1,315 of the division's 4,100 dealerships have been certified. Ford expects to certify 2,400 stores by April 1, O'Connor said.
Three dealerships have failed the testing, he said. O'Connor did not provide details on the size of the stores or the grounds for rejection.
Ford is returning 1.25 percent of the invoice price on 2001 models to Blue Oval dealerships only. That means certified dealers will be reimbursed more than $250 for a 2001 vehicle with an invoice price of $21,000.
In November, five Ford dealers in five states sued Ford Motor Co., contending the practice discriminates against some dealers. The dealers are requesting class-action status to cover all Ford dealers. The National Automobile Dealers Association and state dealer associations also oppose the monetary awards.
Ford says the 1.25 percent payments are incentives and are legal. Critics label the practice two-tier pricing.
Despite the improvement in scores, Ford Division remains in the 'lower tier' of customer satisfaction ranks, O'Connor said. The company shares the blame. 'Some of it is product related, some of it is parts related and some of it is dealer sales and service related,' he said.
The scores are one-third of the computation used to determine annual executive bonuses at Ford Motor Co. In 2000 the automaker gave customer feedback more weight in determining the bonuses paid to 5,500 managers worldwide.
Blue Oval remains controversial among dealers, said Jerry Reynolds, chairman of the Ford Division National Dealer Council and owner of Prestige Ford in Garland, Texas. He said the number of dealers applying for certification is greater than he anticipated. Tougher business conditions have led more dealers to seek the financial awards, Reynolds said.
Last week, Reynolds and Ford dealer council members began meeting to iron out tougher standards for the program's second year beginning April 1.