DETROIT -- Ford Motor Co. plans to start running one of its biggest sales promotions since the recession next week, offering most vehicles at no-haggle prices within about $200 of dealer invoice for the rest of the year.
The “Friends & Neighbors Pricing Event” runs Nov. 3 through Jan. 4, according to a 20-page guide distributed to dealers. Automotive News obtained a copy of the guide, which is marked confidential, from a source outside Ford’s dealer network and confirmed it to be authentic.
The guide shows discounts of up to 10 percent of the suggested retail price and says they can be combined with other incentives it already offers. In addition, the sale enables dealers to earn more from each transaction than they otherwise would — for example, $126 more on a 2015 Focus and $471 more on a 2015 F-150.
“This is truly a rare deal that we can leverage into huge sales and maximized profits,” reads a note at the end of the guide from Ford’s U.S. marketing director, Chantel Lenard, and U.S. sales director, David Mondragon.
Ford will promote the sale with a “heavy” rotation of TV, print, radio and digital advertising in which Ford employees invite consumers to enjoy discounts normally available only to their friends and neighbors, the guide explains.
“This is not your normal, ‘Let’s take $500 off a car,’” said Jim Seavitt, owner of Village Ford in Dearborn, Mich. “Last time we did something like this was … when things were pretty bad.”
Ford officials declined to comment on the sale beyond saying that the automaker had not announced any upcoming promotions.
Mark LaNeve -- the former General Motors executive hired by Ford in January as vice president for U.S. marketing, sales and service -- described the program in the dealer guide as “an inside deal - now for everyone.”
That phrasing evokes the wildly popular “Employee Discount for Everyone” sale that LaNeve ran at GM in 2005 and returned to that approach in late 2008, when GM was months away from filing for bankruptcy. Both times, Ford and Chrysler followed suit with similar offers, but all three companies experienced significant declines in the months after the sale ended.
The discounts Ford now plans to offer, known as “X-plan,” are not as steep as employee pricing, which it calls “A-plan.” And Ford, which on Tuesday reported a record $2.7 billion North American profit for the third quarter, is clearly not in financial trouble.
Market share flat
But Ford’s U.S. sales have been lackluster for much of 2015, before rising 23 percent in September. Its market share was flat in the first three quarters from a year ago, at 15.1 percent, and down from 15.9 percent at the end of 2013.
A big factor is Ford’s changeover to redesigned versions of the F-150 and Edge, which reduced inventories for months. But other important nameplates, including the Escape, Fusion and Focus, have underperformed their segments this year.
Ford introduced dealers to the sale in a broadcast on Monday. They’re being asked to hold a kickoff rally with employees and start promoting the event on Nov. 3, which is the day automakers report October sales and begin their November sales month. All Ford brand vehicles are eligible, except for high-performance versions of the Mustang, the F-150 Raptor, the F-550 and above, stripped chassis trucks and the E-450. The guide does not refer to any year-end promotional plans for Lincoln.
“This campaign will show the passion of the brand while offering a truly unique deal, so please use all the resources available to help make this the best sales event yet!” LaNeve wrote in the guide.
The sale sets a maximum price that consumers would pay, though dealers can agree to sell vehicles for less. The maximum price is 99.6 percent of invoice plus a $275 administrative fee, minus any vehicle-specific incentives. That’s the same way X-plan pricing usually works, though it normally requires consumers to provide a unique personal identification number linked to a particular employee at a supplier, business partner, fleet partner or other Ford partner.
An example Ford used in its guide showed that an unidentified vehicle with a $20,000 sticker price would get a “Friends & Neighbors” discount of $2,000, in addition to $3,000 in other incentives. However, for some vehicles many consumers already pay close to or even slightly below the invoice price, so the sale may not result in any additional savings.
TrueCar’s website today showed the average price paid for an F-150 SuperCrew XLT with two-wheel-drive as $191 less than invoice and $3,093 less than sticker, before $4,000 in customer incentives.
“It’s an effort to take that price worry away from people, and they’re aggressively trying to close the year out,” Seavitt said. “They’re after something that would be different, cut through the clutter and be very simplified.”
Ford said its incentive spending in September, when it offered no-interest, six-year loans across most of its lineup, was up $660 per vehicle from a year ago and flat from August. It had reduced incentives in late 2014 as it began hoarding F-150 inventories in preparation for building the redesigned, aluminum-bodied pickup.
At the same time, its transaction prices rose $1,100 from August to September and $2,100 from September 2014. The Friends & Neighbors discounts would replace any interest-free financing offers.