Some folks in the EV community said it was only a matter of time before some legacy automakers would realize that their current business model may not work for an EV future. In fact, several EV fans have suggested that companies like Ford, GM, Volkswagen, Hyundai, and others should pull their EV division out into new spinoff companies to appeal to investors.
As it turns out, it appears Ford is planning to do just that. According to a report from Bloomberg, Ford is making plans to restructure for a more successful electric vehicle future, and the plan could increase its EV budget by as much as another $20 billion. Bloomberg also notes that Ford is focusing on strategies that have proven successful for Tesla.
Interestingly, though not surprising in the current market, former Tesla engineer Doug Field appears to be the man behind the plan, alongside CEO Jim Farley, of course. Field left his role at Tesla to join Apple, though he moved on to Ford last year.
According to Bloomberg, part of the potential plan could include creating an EV spinoff in an attempt to capture “some of the immense value investors are giving electric startups.” The details came from people who asked to remain anonymous since the plans have not been made public. Another person told the publication that the spinoff would focus primarily on lower-volume mass-market electric vehicles.
Sadly, Ford is not yet ready to provide public comment on the potential spinoff. Chief communications officer Mark Truby wrote in an email:
“We are executing our Ford Plus plan to transform the company and thrive in this new era of electric and connected vehicles. We would not comment on speculation.”
Nonetheless, according to sources familiar with the matter, Ford will spend as much as 10 years and most of the $20 billion to transition its current gas car factories into EV factories. Keep in mind, this new budget would be in addition to the $30 billion Ford has already earmarked for its EV efforts between now and 2025.
Ford plans to deliver some 600,000 electric vehicles over the next 22 months. The Mustang Mach-E is already enjoying notable sales success, and Ford has upped its production. The F-150 Lightning, which is due to arrive this spring, has attracted so much interest, Ford doubled production plans, and then nearly doubled them again shortly thereafter.
Ford’s CEO Jim Farley has complimented Tesla and Elon Musk on many occasions. In a fascinating recent interview (linked below), he said he’s learned plenty from Musk. If Ford follows through with such a plan, it will be very clear that Farley has been taking notes and has been honest about his respect for Tesla and willingness to follow suit. Since Ford has made its future plans clear, its stock has soared, topping out at a $100 billion market cap for the first time in history.
What do you think? Will Ford create an EV spinoff? Will it go public on the stock market? Do you think this potential plan is a good idea? Start a conversation in the comment section below.
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