Working with Dealers

Our dealers are a critical part of our success and important economic contributors to the communities in which they work. They represent the face of Ford in communities across the U.S. and provide employment, tax support, community leadership and customer service.

As we have with all of our stakeholders, Ford is taking a proactive, collaborative approach to working with our dealers to appropriately size our dealer network to match our sales, market share and dealer sales objectives. Ford’s dealer network revitalization plan focuses our efforts on the largest 130 metropolitan market areas, which represents more than half of Ford’s retail sales. Customer convenience factors such as driving distance, location and the appearance of the facility are taken into consideration as part of our analysis. This continues to be an ongoing process. Ford is not mandating dealer consolidations nor competitive cost actions. Instead, Ford and its dealers are working together to continue finding solutions that make Ford and its dealers competitive and best positioned to support customers.

In 2010 we discontinued production of Mercury vehicles, which will affect our existing Mercury dealers. We will work closely with Mercury dealers and customers during the transition, including providing existing Mercury owners with continued access to parts and service support at Ford and Lincoln dealers and by honoring current warranties, including Ford’s Extended Service Plans. As of December 31, 2010, we had successfully resolved Mercury franchise agreements for 96 percent of Mercury franchise holders.

In the U.S. at year-end 2005, we had 4,396 Ford, Lincoln and Mercury dealers, with 2,242 of those dealers in our largest 130 markets. As of year-end 2010, we had 3,424 Ford and Lincoln dealers (a reduction from 3,553 at the end of 2009). We will continue to work collaboratively with our dealers to reduce our dealer network to match our sales, market share and dealer sales objectives. Globally we had 12,000 Ford and Lincoln dealers as of December 31, 2010.