Ford Motor CEO Jim Farley said at an event in Detroit that Ford is going back to its Model A, where they focus on in-house production. They are going to ramp up EV production, all the while returning to its roots. According to Farley, the production of EVs requires 40% less labor than combustion vehicles.
He indicated that there are going to be layoffs in the company. Although earlier this year, Ford announced it would be laying off around 3,000 employees to restructure its business around EV production, Ford’s leader has a plan so that “everyone has a role” in the company’s transformation.
Ford has had success thus far in the US EV market with the Mustang Mach-E, F-150 Lightning pickup, and E-Transit van. Through the third quarter, Ford remained the #2 EV brand behind only Tesla. Farley is not happy with second place, explaining, “we want to be number 1” at the conference in Detroit. To surpass Tesla, Ford’s CEO believes building EV components in-house such as electric motors and batteries, will not only secure jobs but will also create incredible value for the automaker.
On the idea of going back to where Ford started by sourcing its own vehicle components, the CEO says, “We’re going back to where we were at the beginning of the century. Why? Because that’s where the value creation is. It’s a huge transformation.” Up until now, Ford has purchased EV batteries and motors for models like the Mustang Mach-E, but this will no longer be the case, according to Farley.
Ford broke ground on its BlueOval City SK Battery Park in Kentucky earlier this year, which will play a key role in the automaker’s plans to produce batteries for its next-generation EV models. With plans to achieve a two million EV run rate by 2026, Ford will need a significant amount of batteries to get there. Although the company says it has secured the supplies necessary to hit its 600,000 targets by the end of next year, producing them in-house could bring down costs and promote higher margins. As the company’s CEO Jim Farley mentions, Ford building its own EV components will help it to remain competitive while securing the automaker’s future in the industry.”Please use the sharing tools found via the share button at the top or side of articles.
We have a whole new supply chain to roll out, in batteries and motors and electronics, and diversity has to play an even greater role in that,” Farley told civil rights activist Jesse Jackson, whose Rainbow Push Coalition sponsored the conference.