The Blue Oval’s commercial unit, Ford Pro, is showing that there are plenty of buyers out there willing to splurge on subscription services, opening up an important area of revenue that will help to fund the company’s transition to electric vehicles.
The company has revealed that approximately 400,000 Ford Pro customers are currently paying for subscription services. This represents a 60% jump from a year ago and Ford believes that 20% of earnings at its commercial unit before interest and taxes will come from software services by 2026. By that time, Ford Pro believes it could have as many as 1.2 million customers paying for subscription services.
Ford Pro hopes to eventually be earning $2,000 per vehicle annually on subscriptions. Many of the services sold by the Blue Oval’s division include telematics that monitors vehicle health, charging management, and driver performance. One of these services is a $39-per-month field service tool dubbed Viizr that helps users digitize work quotes and invoices.
“There’s actually a value proposition for those customers,” said principal research analyst at Guidehouse Insights, Sam Abuelsamid. “Most of what they’re paying for is telematics, and many of those customers have already been paying for those services from various companies. The same is not true for retail customers.”
Speaking with Auto News, Ford Pro chief executive Ted Cannis says these services are important for fleet owners as they reduce costs and downtime.
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It is unclear if Ford’s retail customers will be as willing to pay for subscription services and software. At the moment, Ford has 200,000 owners who pay for the BlueCruise hands-free driver-assist feature.
“We think it’s going to be really different between retail and Pro,” Ford chief executive Jim Farley noted. “We’re in the early stages of learning about that. It’s very clear on the commercial side that … they’re involved in the software sale. On the retail side, it’s a little less clear. We’re experimenting right now with the best model.”
