Ford Motor Co. is abandoning a plan to stock and distribute electric vehicles through regional inventory hubs after a pilot program failed to catch on among skeptical retailers.
The automaker had intended to store unsold EVs not on dealership lots but rather at one of 21 “rapid replenishment centers” around the U.S., then deliver them to stores within two weeks of being ordered by a customer. The system was meant to eliminate burdensome floorplan expenses for retailers and make Ford’s distribution model more cost-competitive with rivals such as Tesla that don’t use franchised dealerships.
Ford began piloting the concept in May 2024 with the F-150 Lightning and late last year tried to boost participation by incentivizing dealers to order through the centers. But slow adoption and a series of issues prompted the company to pull the plug.
Executives told dealers at the 2025 NADA Show, and in subsequent internal video messages, that Ford was discontinuing the system and returning the Lightning to the traditional wholesale process used for every other model.
“Our intent all along was to better serve the customer,” Mike O’Brien, Ford’s senior director of retail network and sales strategy, told Automotive News. “We think the pilot, from an operational perspective, was a big success. That being said, we listen to our dealers. There’s been a lot of shifts in the marketplace. It is a little tricky to have two different [sales] methodologies.”
Retailers, including members of Ford’s national dealer council, were never fully on board with the idea, even if it reduced inventory carrying costs, largely because of the separate sales process it created for EVs.
A critical flaw was that EV inventory became effectively invisible to most consumers outside of Ford’s website, said Eddie Stivers, who chairs the dealer council. Because the vehicles awaiting buyers were still owned by Ford instead of a particular store, they weren’t able to be listed on dealer sites or third-party aggregators such as Cars.com and AutoTrader.
“It was great in theory. Practically speaking, it didn’t turn out the best,” Stivers said. “The [rapid replenishment centers], the entire time, were a pilot. Some pilots work, some don’t function. We as dealers should be applauding Ford for trying something new but being willing to recognize when it didn’t work out as theorized.”
O’Brien said Ford fixed the inventory problem by the end of the pilot so vehicles could get listed on external sites but admitted that “other issues” and certain systems that were “slow to come online” created headaches.
Other dealers told Automotive News that they couldn’t get window stickers for available EVs, so they could not give customers detailed breakdowns beyond a vehicle’s price. Although they appreciated having no floorplan expenses for the Lightning, they said customers who visit their stores typically want to compare various trims and packages, and that stocking only a few demo units wasn’t sufficient.
In short, some dealers felt it was a mistake to deviate from the traditional sales method.
“They keep trying to reinvent the wheel for something that’s been very successful for many, many years,” said one general manager who asked not to be identified.
The inventory hubs were a key element of Ford CEO Jim Farley’s crusade to implement a “radical redesign on our customer experience” for EVs. The goal was to make Ford dealers more competitive with direct-to-consumer EV sellers.
“We think our distribution model today is about $2,000 per unit more expensive than Tesla,” Farley said in a 2022 presentation to investors. “About a third of that is inventory. We have all this inventory sitting around in dealers, in transit — got to get rid of all that.”
Doug Field, Ford’s chief EV, digital and design officer, in 2023 promoted the regional hubs as a way for customers to “get their dream vehicle — not settle for what’s on the lot.” He said the distribution centers would give buyers far more options by holding a couple weeks' worth of inventory that could be delivered in “less than 10 days.”
Beyond slashing inventory, Farley hoped to create a different sales process involving nonnegotiable prices, remote pickup and delivery, and an e-commerce platform for online sales. He wanted dealers to invest heavily in EV charging stations and other infrastructure to continue selling EVs.
Ford ultimately ended the EV investment program, which had become the subject of lawsuits and complaints from dealer groups around the country. The company is now reimbursing dealers who invested in the chargers.
Since Farley’s 2022 comments, the EV market has shifted dramatically. Although Ford logged record EV sales in 2024, it has responded to lagging demand by deferring investments, cutting planned production on current models, and delaying or canceling future products.
O’Brien said the hubs typically delivered vehicles within seven days and that Ford was pleased with how they functioned. But the process did show the value of dealerships holding at least some inventory on site.
“Having the vehicles on the lot? Yeah, we do think that’s probably important,” he said. “Do they need 100 of them? I don’t think they need 100.”
Ford is not alone in attempting an EV distribution model with centralized hubs.
General Motors continues to expand use of its fulfillment centers. It had six of them serving 30 states as of January and planned to reach as many as 33 states by the end of February, a spokesperson said.
GM dealers still receive EVs for their lots but can access additional inventory at the fulfillment centers for delivery within four days. The focus has expanded to include more models, including gasoline-powered vehicles, the spokesperson said. Duncan Aldred, GM’s vice president of commercial growth strategies and operations, told Automotive News in January that the automaker will continue to learn from the program as it ramps up this year.
It’s unclear how many of the 33,510 Lightnings Ford sold in the U.S. last year came through a regional hub. Total volume for the model rose 38 percent in 2024, its second full year on the market.
O’Brien said he wished there was stronger initial participation in the pilot but ultimately was pleased with how the broader dealer network received the idea.
“It is something we learned a lot from,” O’Brien said. “We’re going to make sure we hang on to those learnings.”
Lindsay VanHulle contributed to this report.