Ford dealers able to add no-resale provision to 22MY F150 Lighting | Hacker News Reader

Ford dealers able to add no-resale provision to 22MY F150 Lighting

lightningowners.com

42 pointshnburnsy72 comments

Who care. It’s a 1 year provision on a hot product and they are trying to get the vehicle to people who will use it, not people who will scalp the price up. I see this as positive, and I can’t wait to replace my 19mpg truck with a lightning, the scalpers can get bent.

Then replace a "no sale" provision with a "no sale over $X" provision. Or require resale to the dealership and exert control over the dealerships. Or...

There are hundreds of ways to deal with scalping that don't include locking people into ownership for a year.

Far as I can tell, what's really going on is that the dealerships threw a fit about not being able to mark prices up and Ford responded by ensuring the dealerships that at least no one else will get what the dealerships felt should have been their extra commission.

TBH, after watching this fiasco and having a single (short!) conversation with the rando middleman at the nearest dealership who I'm forced to interact with for god knows what reason... I'm probably cancelling my Lightning reservation and waiting a few more years for a Tesla or Rivian truck. The whole dealership thing is an albatross around the neck of Detriot companies. It will kill them.

What legitimate reason does a person have to sell their car before the first year ends? Seems highly wasteful to me, but maybe there is something I don’t know?

Edit: friends, the downvote button is not a “I disagree with you” button. This isn’t Reddit.

One could imagine a scenario where e.g. you buy this, fall on hard time, and have to sell it to make it through.

Seems like a small minority of possible cases, unless you really didn't have the means to buy it in the first place.

They should find a way to remediate such problems then, including being able to sell it back to the dealer.

The no-sale agreement is between the customer and the dealer. The dealer would happily waive it if you wanted to sell the truck back to them.

You decide you don't like the car.

The car is a buggy piece of shit.

The care works well enough but is constantly being recalled and you need a 365 work truck. (I just went into a Ford dealership to test drive a Mach-E and was told I can't because there's a seat belt recall.)

You lose your job.

Your parents get sick and you move in with them to help out, but they live in the middle of nowhere and you need >200/300 mi range.

I could keep going all day.

Lemon law protects against a number of these things

Warranties and Lemon Laws cover the first few cases

For the others, indeed buyers should see this more as a lease type contract for the first year, where you can't just get rid of it without paying a fine

It protects against the "buggy piece of shit" but only in very specific cases, which depend entirely upon which state you live in. Most notably, it only applies to new cars. Some states require you to be out of a car for a total of 90 days in one calendar year, and/or have the same problem occur several times.

In several states, recalls don't count towards lemon law because it's a preventative measure, or only applies if the nature of the recall renders the car inoperable. Meaning, you can wait four years for a replacement of a potentially deadly airbag.

You can absolutely have a buggy piece of shit that can't be lemon law'ed.

Getting a car lemon law'ed is a nightmare. It's rare that you have a cut-and-dry case. Just ask people with those Ford Powershift transmissions in their Fiestas.

A warranty will ensure that someone doesn't have to pay to fix the buggy piece of shit, assuming the buggy shit isn't a wear item that the dealership can claim that the owner broke. But there's still the hassle of scheduling the fix, taking the car to the dealership, hoping they have transportation for you, etc.

.. because a purchase means that the purchaser now owns the item, not the manufacturer. How has that changed? Who benefits?

We bought our previous car from a guy who did just that. He loved cars, so he bought them, drove them for 6-9 months and sold them. Yes he took a huge loss, but it was his hobby.

A couple we know bought one of the new Morris Mini's a few years back, and one month later they discovered they were having a kid. The Mini isn't the most practical vehicle for a new family, so they sold it and bought something else before the kid was born.

We just got our car totalled and we were not prepared to get a new car just yet. We might be getting a larger garage this year which would allow us to park ID.4/Ioniq 5 sized vehicles in it, so timing wasn't awesome. So we bought an second-hand vehicle which we plan to sell within a year.

Things happen.

That would be too hard to track and enforce.

> no sale over $X

There is no realistic way of enforcing this.

I already gave one example of a way to enforce it in my original post: require any resale to be mediated by Ford/dealerships. That is exactly one pivot table harder to enforce than the no resale provision itself, right?

You could do a bunch of other stuff, too. E.g., require Ford to be notified of all sales. Again, this involves the impossible difficulty of one extra pivot table.

Buyers enforce it by reporting it to Ford

Why would they do that?

Because buyers hate scalpers.

Trying to placate buyers is exactly why Ford is doing this.

And Ford needs to file lawsuits and deal with all of that nonsense. They did the same thing with the GT, and the lawsuits outlasted the no-resale provisions.

The legal system is way too slow for something like this, Ford can't prove much in damages that result from this, and the cost of suing will wipe away more than anything they could claw back anyway.

This is a pointless endeavor.

Ford isn't aiming for perfect - they're doing something easy and more or less cost-free to dissuade scalpers from immediately flipping cars.

Will it prevent all scalping? No. Will it prevent some scalping? Probably, yes.

> Or require resale to the dealership

I'm sure the dealership would happily waive the no-sale provision if you wanted to sell your truck back them. There's literally no reason not to.

What you’re suggesting is super complicated, instead they can just decide not to sue the everyman who lost their job and sold the truck, and definitely go after the scalpers that are wealthy and just trying to flip the vehicle.

...then why not just make "no scalping" the rule and do exactly what you're proposing anyways? How is that any more complicated?

Because that caps the value of the truck long term.

retain the one year term.

this isn't rocket science.

ugh. Look. No-resale within a year is not that difficult to notice and enforce. You can look at DMV records. It is easy to correlate with who bought the truck. If you've ever sold a used vehicle, you know there is all kinds of scamming going on with what people want you to write as the sale price (what they pay taxes on) vs. what it actually sells for. How in the world would you discover what someone actually paid in a private sale transaction? Sue and do discovery after? That is incredibly expensive.

> No-resale within a year is not that difficult to notice and enforce.

Ford would have to be A) willing to actually sue someone, and B) willing to deal with the fallout when the only person who doesn't bend to their will turns out to be a widow with six kids from fucking Texas, whose legal bills are covered by a Go Fund Me and GM very publicly gives her a Silverado EV just to rub it in.

Ford will absolutely win in court, but not every battle is fought in the court room.

You want a tesla and that is great for you. It sounds though that this has biased you against more traditional "dealer" alternatives.

Removing features like the ability to resell does not allow dealers to jack up prices. If your reaction is anything typical, it will reduce demand and soften the dealer's position.

I see this very much as a pro-consumer move to limit speculators for reducing availability as they have repeatedly done with other high demand items.

No one, including the manufacturer (who you likely get your loan from) wants to see you default and there will almost certainly be options to sell back to the dealer to avoid that.

I specifically don't want a tesla. Nothing has biased me against traditional dealers other than dealing with them all my life.

Scalping only exists because the product is sold below the market’s clearing price. Raise the price and you’ll take the air out of the room for scalpers to exist.

EDIT: remove unnecessary scare quotes left from unpublished draft

Some call that "gouging".

Some are willfully ignorant of the optimizing nature of a free market.

> Some are willfully ignorant of the optimizing nature of a free market.

Not really. The issue is more zealous believers in the "free market" quoting oversimple Econ 101 prescriptions at every opportunity.

When all you have is Econ 101, changing the price looks like the solution to every problem.

No one would call it gouging. Gouging had to do either necessities in a time or of need. Not a manufacturer raising the price due to higher demand

And price out the low end of the market that is your bread and butter customer and best word of mouth. They want to get these into the hands of farmers and ranchers and blue collar construction workers who will tell their friends "hey this works even better than my old ICE F-150, you should get one too!".

They're already having problems doing that with the huge markups of the dealers. Letting them hit clearing value would be even worse.

Ford isn't interested in near term profits on this, they are interested in building a base of happy customers.

No farmer is buying a $95000 crew cab with a 4ft bed.

That is msrp on the higher end. The ones that the flippers will probably shoot for

The problem is that a bunch of urban hipsters will always be willing to pay a ton of money for stuff they will never need, whereas the people who do need such a vehicle are straight out of luck.

No one needs a $95000 f150 with a 4 foot bed. This was made for urban hipsters to transport yoga equipment.

You’re thinking of this as a single product, standing alone in the market. Ford is a brand, and is trying defend their flank with this vehicle. They care about many more factors than this truck selling for every cent it can, selling a $110k pickup (or whatever, I use early model x pricing as the baseline) would damage their brand with the people who buy these trucks.

They're also trying to morph into a service model. Requiring all sales be first person effectively ensures Ford gets full data on its drivers.

> and I can’t wait to replace my 19mpg truck with a lightning, the scalpers can get bent.

19mpg truck reminds me that I need to replace my 2015 19mpg 1.6L compact hatchback with something electric.

And electric can't come soon enough! Especially for those of us in hilly cities.

It's average 19mpg, the 2014 Ram 1500 with a 5.7l and half cylinder bank deactivation. Actually not horrible for a really heavy vehicle.

I mean, you can have a strong distaste for scalpers, but it doesn't make this any more reasonable a thing to do.

Granted, buyers have every right to say "nah, I'm out", which IMO they absolutely should do.

I don't particularly like scalpers either, but I have a much stronger distaste for the idea that a physical product I purchase under pretense of ownership is then treated as a leased / subscribed / otherwise non-owned possession.

> Ford famously slipped an anti-flip clause into the buyer agreement for its $450,000 supercar that prohibits owners from selling the car for 24 months. The owners themselves were carefully chosen through an extensive application process, with many of the cars going to celebrities and other high-visibility individuals to help publicize the car and the brand. Cena was one of those deemed worthy, likely thanks to his emergence as a YouTube car reviewer in the past year.

This is fair. They didn't sell him a car. They signed him as a promoter. I cannot see any possible motivation for a dealer to add no-resale provisions to their agreements with ordinary customers.

I cannot see any possible motivation for a dealer to add no-resale provisions to their agreements with ordinary customers.

If these vehicles are in high demand, to prevent scalping? The length of the restriction ("no resale for one year") seems aligned with that goal.

> If these vehicles are in high demand, to prevent scalping?

I see the manufacturer wanting this. But not dealers. Scalpers are just outsourced distributors from a dealership's perspective.

"It would be bullshit if some guy just buys the truck from me, I can't charge because Ford told me so, and then that guy turns around and gets half of what should have been my commission!" - the no-value-add middle man that Ford is forcing me to go through to buy their truck, when asked exactly this question.

I'm all for preventing scalping. It makes perfect strategic sense for Ford! The reason their approach toward the scalping issue is so uniquely idiotic is because the dealership model means they have to massage the bruised egos of useless middlemen.

Should just be 1 per customer per year. End of problem.

Ford is putting strong pressure on the dealerships to not gouge on markups, without the resale provision scalpers would eat up all the inventory and pocket the difference instead.

Some dealership owners will hate this provision of course, because otherwise they could still sell near MSRP but only allocate to the themselves, family, friends, and employees who would then instantly scalp.

They did the same thing with the Lexus LFA. They just bought the cars in the name of a business and sold the business. Problem solved for the flippers. I think the best solution is to allow dealers to sell them at MSRP and select buyers via a lottery. Some percentage will flip it, but many wont because they legitimately wanted the vehicle.

I don't get why Ford doesn't skip this whole ordeal and make the Lightning lease-only. Ford spent a ton of time in courts enforcing this on the GTs.

Alternatively, why not auction them off instead of setting an MSRP?

Lastly, they could raise MSRP to like $500k and gradually lower it over time, then make owners sign a document stating that they understand that Ford will lower MSRP over time, and that owners will be subject to excessive depreciation as a result. This will prevent the situation that Dodge got into with the Viper.

It's clear that the market value for these is significantly above MSRP. We are all just arguing over who is entitled to that money: the manufacture, the dealership, or the buyer.

Because Ford goes bankrupt without the F-150 brand. They NEED to win the electric truck wars if they want to survive for another 50 years. If the only people driving the lightning are the sorts of people who can pay 500k for a truck, the damage to the Ford Truck brand would be immense.

I'm not saying permanently set the MSRP to something obscene. Just for the first model year to get those Gotta Have It people with infinitely deep pockets their vehicles first, so that we can all move on.

Those people are going to pay that price anyway. It's just that dealers are going to piss off customers by taking orders they know they aren't going to honor because Deep Pockets Paul and/or Scalper Sally going to come along and pay the obscene ADM and nick the order from someone who got their hopes up.

The truck is worth $x but is selling for much less than $x. So, the sorts of people driving the Lighting are going to be the sort who can spend $500k (or whatever market value is) on a truck. It gets back to the fact that we are merely arguing over who is going to get this extra money: the manufacture, the dealership, or the original buyer.

https://en.wikipedia.org/wiki/First-sale_doctrine

> https://en.wikipedia.org/wiki/First-sale_doctrine

https://globalnews.ca/news/4283526/john-cena-ford-settle-law...

Ford's done this before, and if a settlement is the best that John Cena's team could reach rather than disputing it on First Sale grounds, it makes me think Ford's reasonably certain it's on sound ground.

Not a lawyer.

Doesn’t matter much when you’re reliant on software updates to do pretty much anything on a vehicle. Better to just acknowledge that vehicles come with an EULA these days.

I don't think the first sale doctrine applies here. This isn't an issue of trademark or copyright. This would likely fall into the realm of a restrictive covenant which are much more common in real estate transactions.

I support this. One year seems reasonable. I can't stand scalping. I assume the dealership retains the ability to buy back the truck? That gives someone an out if they really do need to sell in the first year.

I'd also like to see it with consoles and GPUs. In those cases, Consoles are easier. GPUs are harder. But I imagine for consoles you could limit the PSN account to the one who purchased it.

I do too. I'm sick to death of scalping.

Post 3 has the letter from Ford to the dealers, sorry should have linked to that post.

https://www.lightningowners.com/threads/ford-warns-dealers.4...

If you can't resell it, you don't really own it.

I wonder how this is enforced? Is there some kind of mandatory registration with Ford that is required for the car to work? Or are they threatening to sue if they find out you sold it?

Any car I have owned, reselling it has nothing to do with the dealer. This is one reason I would never a vehicle that came with any kind of software subscription from the dealer / manufacturer. It's just another tool they can use to extract money from you and deny your ownership rights.

In this case, it's not clear what the enforcement mechanism is though, it may not be software related.

> If you can't resell it, you don't really own it.

The provision is for a one-year no-resale provision:

> Purchaser hereby agrees that it will not sell, offer to sell, or otherwise transfer any ownership interest in the Vehicle prior to the first anniversary of the date hereof.

The product is hot, it's understandable that Ford wants to prioritise users of the product over scalpers.

All Ford can do is take them to civil court, and it remains to be seen if any court will consider the contract enforceable.

It's a slight difference, sure, but not a meaningful one. If you buy the product, and are subsequently disallowed by the original seller to do what you please with it, then you don't own it and are merely leasing it - at least for the first year.

Then don't buy it. I don't buy iPhones for this exact reason.

Yeah, I have a hard time seeing the courts enforcing this. There are precedents with books - publishers tried to prevent people selling used books, and the courts smacked them down.

I have a slightly less hard time seeing the courts allowing Ford to use technical means to prevent resale. (Though if Ford does it without informing buyers, that would probably be a major red flag to the courts.)

The key here is that Ford can just say "no sale" if you decline to accept the offer; someone else will be willing to buy it under those conditions.

OK, but courts can and do rule that certain provisions of contracts are not enforceable.

Seems like such a restriction could be subverted with an expensive sublease and a contract to sell at the first-available date.

Where there's a desire, there's usually an arbitrage...

That's a much more complex engagement than a simple flip, so most of the scalpers are not going to bother with such an arrangement

I find the size of that thing enormous. Why is that the most sold vehicle in the US? I find it almost impossible to believe all those buyers actually need to move a few tons of stuff on a regular enough basis ( weekly?) to warrant such a monstrosity with associated externalities ( pollution, fuel use for the non-electric version, and weight destroying roads for all version and even more so for the electric one).

How does this square with the first sale doctrine?

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