Ford plans to cut dealer bonuses by nearly 50% in a cost-cutting move that will take effect next year, a source familiar with the issue told Reuters on Tuesday.

“Ford is revising Blue Oval and cutting bonuses by nearly half,” the source reportedly said, on condition of anonymity. “It is no longer financially feasible for Ford to continue the bonus payout at current levels.”

Under the new Blue Oval dealer incentive programme, effective next April, bonuses will be paid to all Ford dealers meeting monthly sales targets but dealerships meeting 75% of their year-ago sales will receive only $75 per vehicle, while those that exceed year-ago sales will receive $125 per vehicle, the source told Reuters.

Under the current, more generous programme, Ford pays certified dealerships a flat 1.25% of the base sticker price for every vehicle they sell. Dealers have to meet certain customer service standards set by the automaker to be certified. About 90% of Ford’s dealers in the United States are Blue Oval certified.

Ford is planning to brief all dealers on changes in its bonus program on Friday, Reuters noted.

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