For the first time in over two years, Ford is updating its dealership floorplan assistance program, introducing new rules aimed at financially benefiting retailers and encouraging faster inventory turnover.
Starting July 1, the automaker will offer dealers an upfront credit worth one percent of the sticker price on most retail vehicles. This update replaces the current program, which reimburses floorplan interest charges based on the number of days a car stays in dealer stock, up to 75 days. The previous program, in place since April 2022, was enacted during an industrywide inventory shortage when vehicles were often sold within days, resulting in minimal credits.
“This is really going to give our dealers greater flexibility in how they use those credits and their floorplan assistance for them to move their vehicles quicker,” said Andrew Frick, president of Ford Blue, Ford’s gasoline and hybrid vehicle business unit. “This was one of their key requests.”
Eddie Hall III, a member of Ford’s National Dealer Council and COO of Hall Automotive Group, which operates three Ford stores in Michigan, expressed his support for the change. “I’m supportive of going back to a percentage-based floorplan assistance program because it will allow dealers to earn credits if they turn their inventory quickly and because the percentage becomes more and more meaningful if/when interest rates begin to fall,” he said.
Higher interest rates and rising inventory have turned floorplanning from a profit source into a dealer cost in recent years. The program changes could help keep Ford’s inventory in check by encouraging dealers to sell vehicles more quickly. According to Cox Automotive, the industry had a 74-day supply of new cars at the start of June, with a total inventory of around 2.9 million. Approximately seven brands, including Ford and Lincoln, had over 100 days’ supply.
Ford CFO John Lawler has expressed concern over rising inventory across the industry, stating, “I think we’re at a point as an industry where we need to be very thoughtful about how we proceed from here and watch our production relative to supply very closely.”
The floorplan assistance update is one of several changes Ford is implementing in response to feedback received during in-person meetings with dealers nationwide. Other changes include dissolving the electric vehicle certification program and promising to add more field service engineers and technical training programs.
