Main Highlights:
- Bloomberg reports that Ford intends to spend up to $20 billion restructuring its operations in preparation for an electrified future.
- Ford previously pledged a $30 billion investment in electric and autonomous car development by 2025.
- Ford reportedly chooses Doug Field, a former Apple, and Tesla executive, to manage the restructure, including converting factories from gasoline to electric vehicle production and adding extra engineers.
- Farley’s goal is to mimic Tesla in several ways, not only in terms of electric car adoption.
Ford would spend up to $20 billion reorganizing its operations in preparation for an electric future. Additionally, the manufacturer is considering spinning off a portion of its EV business as a particular acquisition company (SPAC) to attract additional investment. Ford previously announced that it will invest $30 billion in developing electrified and driverless vehicles by 2025.
Ford is allegedly appointing Doug Field, a former Apple, and Tesla executive, to lead the restructuring, which would entail transitioning plants from gasoline to electric car production and recruiting additional engineers. (General Motors, which reports fourth-quarter earnings Tuesday evening, recently announced an endeavor to hire 8,000 other employees to support its EV initiatives.)
Ford vs. Tesla
Ford is embroiled in a high-stakes competition with rivals as the auto industry tries to catch up to Tesla, the world’s most valuable manufacturer and the leading seller of electric vehicles. While Ford sells more F-series trucks than Tesla produces in a single year, investors have rewarded Elon Musk’s vision of an all-electric future with a substantially higher share price and increased confidence in the company’s prospects.
Ford CEO Jim Farley attempts to alter that perception by demonstrating that his firm is competitive. Ford said recently that it will double manufacturing its next electric pickup truck, the F-150 Lightning, and triple production of the Mustang Mach-E to reach over 200,000 units per year by 2023. Ford’s E-Transit electric delivery van also goes on sale early this year.
Ford will join Rivian and GMC as the only automakers having an electric pickup truck on the market if they begin selling on schedule. (Rivian began distributing its R1T pickup truck in October, while the first Hummer EVs began arriving in December.) Tesla’s long-awaited Cybertruck has been delayed until next year, and CEO Elon Musk has stated that the business would not start mass production until 2023.
Concerning a possible SPAC, Bloomberg says that Ford is considering spinning off a “small” portion of its electric car company, likely focusing on its lower-volume products. GM thought an EV SPAC for a long time before abandoning the concept. Ford’s representative declined to comment on “speculation and hearsay.”
SPACs’ popularity has waned due to federal authorities’ examination of several of the EV companies that went public via reverse mergers. The SEC is already probing the SPAC transactions that created publicly-listed electric car firms Lordstown Motors, Canoo, and Nikola. The government has been particularly concerned about the authenticity of the financial predictions given by these firms at the time of the merger announcements, as well as any statements made about preorders for their automobiles.
Doug Field, who formerly worked as Apple’s vice president of special projects, would be put in charge of this enormous transition. He was the de facto leader of the company’s befuddled attempts to develop an autonomous electric automobile, dubbed Project Titan. He formerly worked at Apple as the vice president of Mac hardware engineering. Still, he left the business in 2013 to become Tesla’s chief vehicle engineer, where he oversaw the Model 3 sedan’s troubled development. In 2018, he resigned from Tesla and rejoined Apple.
Farley has set out to replicate Tesla in various ways, not simply in terms of the transition to electric vehicles. The corporation is rallying around a commercial strategy dubbed Ford Plus, which aims to increase the number of entirely networked cars and can be upgraded wirelessly, similar to Teslas. Additionally, Ford has stated that Google’s Android operating system would power infotainment systems in “millions” of its vehicles beginning in 2023.
