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Ford Keeps Blue Oval Plan for Dealers; Revised Proposal Would Retain Bonuses Until 2005

December 10, 2002

Ford Motor Co., facing a flood of complaints, is backing away from a proposal to drastically cut payments made to dealers under a customer

satisfaction program, according to the Detroit News.

In November, Ford Division President Steve Lyons told dealers that the automaker could no longer afford to spend $700 million a year in bonuses for dealers who meet standards in the 2 1/2-year-old Blue Oval Certified program. Qualified dealers receive a refund equal to 1.25 percent of the invoice price of each car and truck sold -- or an average of $250 per vehicle.

Lyons proposed cutting the payments 60 percent over three years.

Last week, after hearing from hundreds of miffed dealers, Lyons presented a new proposal: Keep the program as it is until March 2005 and

then kill it altogether, according to the News. The proposal allows Ford to fulfill its original commitment to keep the Blue Oval in place for five years.

"I think it restores some credibility for Ford's management," said Jerry Reynolds, who owns a large Ford dealership in Garland, Texas.

Ford is likely to make a final decision on the Blue Oval program by the end of the year. "The current proposal incorporates the feedback we have received in the past few weeks and addresses many issues raised by our

dealers," Lyons said, according to the News.

“This is a credit to Ford’s willingness to listen and to the consensus approach of the Ford dealer council process,” said H. Carter Myers, III, chairman of the National Automobile Dealers Association (NADA).

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