The Ford F-150 Lightning all-electric truck began rolling off the assembly line on Tuesday. But if you buy one, you might have to sign a contract forbidding you to sell it for at least a year. It's the latest development in the highly anticipated launch that has turned into something of a feeding frenzy.
The Twitter account @F150Gen14 posted an image of the letter in January, and since then it has been independently confirmed by media sources.
The letter cautions dealers against demanding additional fees from customers who have already paid deposits to preorder the truck, warning them that any dealer caught collecting extra fees may find its supply of the truck cut off. (Of course, as MotorTrend pointed out, there's nothing to stop dealers from simply raising the price of the Lightning well over the MSRP, thus profiting from the supply-demand mismatch in a slightly different way.) At the same time, the letter offers dealers the option to include the no-resale-for-a-year clause in the sale, to prevent speculators from buying up the trucks and selling them to impatient buyers at a big premium.
It's an astonishing move, but not completely unprecedented. Back in 2017, the company imposed a no-resale-for-two-years requirement on buyers of its GT model. That was very much a specialty vehicle, a two-seater sports car created to commemorate the company's triumph in the 1966 24 Hours of Le Mans race (also the subject of the movie Ford v. Ferrari). The GT had a starting MSRP of just under half a million dollars, and even if you had the cash, it was very difficult to get one. Ford meant it about the waiting period for resales too--when pro wrestler John Cena attempted to sell his, Ford took him to court. Still, the temporary GT resale ban affected only a very few buyers. Assuming dealers use the clause (which obviously is meant to protect their interests), it could affect the 200,000 people who have already reserved the Lightning, as well as anyone else who wants one, and will likely have to wait longer than a year to get one.
Limiting resales this way is an extraordinary move, but these are extraordinary times for both the car market and the used-car market. Ford is making a very large and very splashy commitment to EVs, having now made electric versions of both its iconic Mustang and its incredibly popular F-150 pickup truck. CEO Jim Farley told The Verge that the chip shortage all automakers are struggling with won't constrain production of the F-150 Lightning--suggesting that the company will pull chips from the production of its internal combustion engine cars if necessary. And indeed, many on social media responded to Ford's announcement that the Lightning was rolling out of its factory with complaints about how long they'd been waiting for the non-electric vehicles they'd ordered.
Some have criticized Ford for imposing a yearlong ban on resales, questioning whether it's smart--or even ethical--for the company to tell customers what they can and can't do with their own cars after they've paid for them. But those critics are wrong. Ford has been in business for 118 years, and the company is well aware that if demand for its cars far outstrips supply today, the day will come when the reverse is true. So Ford is very smart to protect its customers from dealer gouging and both dealers and customers from the automotive equivalent of concert ticket scalpers. Some seem to welcome the move.
Ford is smart too in making a big commitment to electric vehicles. The company first started promoting the F-150 Lightning in 2019, at a time when gas cost less than $2.85 a gallon. Its leaders couldn't have foreseen the coming pandemic, or the changes to the automotive market it would bring. Today, it looks prescient, creating the first large-production full-size electric pickup truck to hit the market at a time when gas prices are well over $4 a gallon, and electric car sales have just overtaken diesel sales in Europe. I am, admittedly, biased in favor of electric cars. But even their detractors have to admit that EVs are the way of the future and that they will inexorably take over the automotive market.
A few years ago, before he became CEO, Farley spent some time visiting companies in Silicon Valley and realized that "They're after our customers," as he told The New York Times. Cars these days are as much about software as they are about anything else, something that has helped give Tesla--founded in California and financed with software dollars--an early advantage in the EV market. (It has to be said that old-line U.S. automakers' longtime disdain for electric cars didn't help.)
Today, given the companies' relative valuations, investors appear to believe that Tesla's lead is decisive and that the Big Three will never be able to catch up. The F-150 Lightning, an electric version of the nation's most popular vehicle with the full force of Ford behind it, just might be enough to rewrite that future.