Ford Motor Co. will assist dealers and owners of body shops in order to replace and repair damaged aluminum panels of its new 2015 Ford F-150 pickup at a competitive cost to them and those who buy the new truck.
Jim Farley, Ford’s head of global sales, marketing and service, told dealers the automaker would subsidize 20 percent (up to $10,000) for training and equipment needed to repair the new truck’s aluminum body panels. The subsidies, in addition to engineering to make the truck easier to repair, are aimed at keeping repair costs low and insurance premiums competitive with trucks made of steel.
Ford is taking a large risk in the degree of aluminum in the F-150, which has been America’s best-selling vehicle for more than 30 years and is built at the company’s Claycomo assembly plant. It is highly profitable, and any spike in manufacturing or repair costs could dampen investors’ enthusiasm in Ford’s future earnings.
Dealers from across the country met in New Orleans through Monday for the National Automobile Dealers Association’s annual convention.
The cost of training, tooling and certification is expected to be in the $30,000 to $50,000 range per dealership for those starting from scratch, said John Felice, Ford vice president of U.S. marketing, sales and service.
Ford unveiled the new F-150 earlier this month at the North American International Auto Show in Detroit. The aluminum body panels will reduce the truck’s weight by 700 pounds from the 2014 model.
The weight loss makes it possible to offer the truck with a new 2.7-liter turbocharged EcoBoost V-6 engine as one option. Speculation is that the truck is aiming to attain 30 miles per gallon on the highway, but government-certified fuel efficiency figures have not been released.
Such a small-displacement engine was unheard of a decade ago, when the prevailing wisdom was that pickups needed a powerful V-8 to perform most tasks.
Dealers had many questions about the costs associated with aluminum, which is substantially more expensive than steel.
They were told the 20 percent of Ford dealers with their own body shops must be certified as well as the 80 percent of independent shops expected to work on the truck.
All will be certified and ready to go by the time the truck goes on sale late this year, Felice said.
One dealer with his own collision shop is Todd Citron of Hub City Ford in Lafayette, La., who said he is the biggest truck dealer in Louisiana.
Citron said he will invest in training and new equipment to work with aluminum, but the cost is worth it to have the best-selling truck in his dealership.
Pat Milliken Ford of Redford Township, Mich., also has its own collision shop.
“We'll make any investment we need to make for it to be successful from day one,” said Brian Godfrey, general manager of the Redford Township dealership. “We want to make sure it isn’t a concern.”
Ford dealers in the U.S. are anticipating 16 new or significantly updated models this year, including the 2015 F-150, Mustang and Edge.
After the meeting, Citron said he thinks insurance costs will be the same or less because of the modular way the truck is built.
“It was designed to be easily repaired,” said Mark Fields, Ford president of the Americas. Ford had teams assessing manufacturing, service and insurance issues for about 15 months before the truck was even approved, he said.
Much effort went into engineering the truck so portions are easily removed for affordable repair, Farley said.
(A giant booth at the NADA convention was used to educate dealers. Ford will be at three other trade shows this year, said Paul Massie, collision product marketing manager.
Leading up to the F-150 reveal, Ford worked with a dealer product committee to identify and resolve issues before the truck goes on sale.
The efficiencies should be reflected in competitive insurance rates, Farley said, but insurers will set pricing.
Fields said the automaker contacted insurance companies so they will be prepared for the switch.
The new aluminum structure will represent 20 percent of total repairs, said Eric Peterson, F-150 marketing manager. The majority of vehicle repairs are grilles and lights or smoothing out dings and dents. Ford has experience with the lighter-weight material because the 2014 F-150 has an aluminum hood.