FI showroom red and grey logo
MenuMENU
SearchSEARCH

Will Ford Keep Its Build-to-Order Strategy?

Ford CEO Jim Farley wants to maintain the company’s build-to-order strategy after the chip shortage ends. Will consumers adapt?

November 16, 2021
Will Ford Keep Its Build-to-Order Strategy?

Ford Broncos have been a popular build-to-order vehicle.

Credit:

Off-road.com

3 min to read


 

Ford Motor Co. pivoted to a build- to-order sales model to address inventory shortages amid the ongoing semiconductor shortage.

Now, CEO Jim Farley has announced he wants to keep the strategy after the chip shortage ends. Auto manufacturers benefit from this strategy with more efficient production and bigger profit margins. Others say it goes against consumer desires for immediate gratification.

Ad Loading...

Still, over 25% of Ford's retail sales in the third quarter came from its growing order bank. Ford currently has 139,000 vehicles on order. The company also gives a $1,000 discount for customers willing to wait for their vehicles.

When the sales rankings in the U.S. for September and October came out, Ford emerged as the top seller among automakers that report monthly results. The automaker’s numbers fell short of 2020 levels, but they outperformed the industry average.

Some dealerships are not as optimistic about a build-to-order sales model, however. They worry long waits will frustrate customers, causing them to cancel their orders once inventory becomes more plentiful. But other dealers feel these worries are unfounded. They point out that online retailers have proven that buyers will wait for their vehicles. And Tesla has long taken orders for later delivery.

Chip Diggs, director of Internet sales and marketing at Seelye Automotive Group in Kalamazoo, Michigan told Auto News that “The model for the consumer has changed. If they're willing to wait two or three days for something from Amazon, that's small, absolutely they'll wait for something that's [$50,000], [$60,000], $70,000 for six to 12 weeks."

Diggs adds that built-to-order vehicles account for at least half of Seelye Ford's sales in the last few months.

Ad Loading...

Build-to-order options will help smaller retailers compete with larger auto groups with bigger inventories, according to Diggs. And having fewer vehicles on the lot also would reduce their floorplan costs.

Diggs believes dealers will see success with a build-to-order model when they pitch it to customers correctly. A key benefit of ordering versus buying what’s on the lot is customization. Dealers have successfully sold vehicles in Europe this way for years.

Ford also sees it as a win. During the company's second-quarter earnings call with Wall Street analysts, Farley noted that having an order bank forces the automaker to reduce complexity and "put pressure on our industrial system to deliver quickly." He suggested the move would reduce the need for discounts that push slow-selling vehicles off lots.

Jason Cole, executive vice president of Cole Automotive Group, reports he would like to see the automaker balance an order bank with stock vehicles. A build-to-order solution doesn’t appeal to every customer.

"Some people you sell to in the car business … didn't wake up that morning planning to buy a car," he told Auto News. "I think you're still going to need inventory for that kind of situation. Not everybody's as particular as some consumers."

Ad Loading...

However, Ford isn’t asking dealerships to move all inventory to a build-to-order model. The automaker still wants dealerships to have some vehicles on their lots.

Originally posted on Auto Dealer Today

More Showroom

Dodge emblem on orange vehicle
Showroomby Hannah MitchellJune 15, 2026

New Vehicles Down for Most Brands

Healthy May sales cut into inventory as automakers kept a tight reign on supply, though some brands ended the month with excess units on the ground.

Read More →
Photo of the back of an electric Mercedes
Showroomby Hannah MitchellJune 10, 2026

Auto Prices Ride May Moderation

Flat ATPs and asking prices clocked in below long-term averages for the month, though some segments saw significant price gains, reported Cox Automotive.

Read More →
Orange Mitsubishi car on grass
Showroomby Lauren LawrenceJune 8, 2026

Mitsubishi Sets Growth Strategy, Structural Transformation

The Japanese automaker aims to 'strengthen products and technologies that embody its brand identity,' focus on its strongest markets and expand value-chain businesses 'that leverage its unique strengths.'

Read More →
Ad Loading...
inside of car, view of steering wheel with hands on it driving
Showroomby Lauren LawrenceMay 29, 2026

Affordable, Safe Cars for Teen Drivers

Families looking to balance affordability and safety in vehicles for their teen drivers can look to the updated list of recommended vehicles by IIHS and Consumer Reports.

Read More →
Gray-scale photo of a line of Mini cars in a dealership parking lot
Showroomby Hannah MitchellMay 27, 2026

Auto Dealers Feel Better But Not Great

A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.

Read More →
exterior daytime image of Porsche North Miami dealership
Showroomby Lauren LawrenceMay 22, 2026

Holman Opens Porsche Dealership in Miami

The North Miami store features the brand’s signature Destination Porsche design concept, combining contemporary architecture and technology to create what the auto group calls an ultra-luxury experience.

Read More →
Ad Loading...
Outside of a Cadillac dealership.
Showroomby Lauren LawrenceMay 20, 2026

Chicago to Gain Cadillac Rooftop in 2027

The two-story Cadillac dealership is being constructed at the former Lincoln Yards site, owned and operated by Canada-based Jack Carter Auto Group.

Read More →
Photo of sold Ford store exterior
Showroomby Hannah MitchellMay 11, 2026

Mid-Atlantic Ford Store Has New Owner

A growing Maryland automotive group is only the 93-year-old dealership’s third owner after its longtime proprietors retired.

Read More →
groundbreaking ceremony for new Barrington Porsche dealership with Murgado Automotive Group and Joseph Nicholas Construction
Showroomby Lauren LawrenceMay 11, 2026

Porsche Dealership Breaks Ground in Illinois

Barrington Porsche will be the new location for Murgado Automotive Group’s existing Porsche dealership currently in the Motor Werks of Barrington auto mall.

Read More →
Ad Loading...
aerial view of Fireside Honda in Ohio
Showroomby Lauren LawrenceMay 6, 2026

Michigan Auto Group Acquires Ohio Rooftops

Feldman Automotive Group added two new brands, Honda and Toyota, to its portfolio with its latest acquisition of four Fireside dealerships in Ohio.

Read More →