Ford Motor Company, one of the most prestigious automotive brands in the world, has decided that it is going to go toe-to-toe against Tesla for the crown of electric vehicle (EV) supremacy. The automotive juggernaut is planning a massive organizational restructuring to prepare for the electric future by using Tesla’s road map that led them to success. The Chief Executive Officer of Ford, Jim Farley, has recently taken up the reins of the company and wants to disrupt the 118-year-old automobile manufacturer’s business model. He plans to achieve his goal by splitting the company into two distinct sectors to maximize its potential. This is to ensure that their new venture does not hamper the production of their traditional vehicles powered by internal combustion engines, which is their primary source of funds for their electric vehicle aspirations. If he becomes successful then that could potentially lead to huge profits, which in turn will make the investors happy. However, reaching such optimistic goals will be a challenge.
How Ford Plans to Challenge Tesla for EV Supremacy?
Currently, Tesla is the leader in the electric vehicle industry. No other vehicle manufacturer has come close to reaching the heights set by Tesla. In 2015, a California-based electric vehicle startup called Faraday Future tried to challenge Tesla for the throne. The company had the perfect recipe to become a force to reckon with in the electric vehicle industry – a billionaire tech entrepreneur, a star-studded cast of industry veterans, and funding from China. However, by 2018, the company burned through billions of dollars primarily due to the co-founder’s aggressive money borrowing which led to the eventual downfall of Faraday Future. This goes to show that money and resources alone are not enough to knock Tesla off its pedestal. So, let’s see how Ford is planning to challenge Tesla for EV supremacy.
Ford will increase investment in its electric vehicles to $50 billion by 2026, which has gone up from the previous $30 billion by 2025. Furthermore, Ford announced back in May 2021 that the company would be investing $22 billion and are expected to spend $5 billion this year. The company hopes that its financial investments would be enough to soon catch up to the industry leader Tesla.
One of Ford’s biggest investments in the pursuit of zero-emission electric vehicles is in the construction of the BlueOval City in Tennessee, USA. It is a $5.6 billion mega campus that is going to be a hub for Ford to build the next generation of electric F-Series pickups and advanced batteries. Moreover, Ford is also going to build a new BlueOval SK Battery Park in central Kentucky which consists of twin battery plants that will power the new lineup of electric Ford and Lincoln vehicles. Both Ford and SK Innovations plan to invest $11.4 billion in the production of advanced lithium-ion batteries for the future of electric vehicles. And to complete this mega EV project, Ford is investing $525 million in the US to train competent technicians whose role is to maintain connected, zero-emission electric automobiles.
Production of Electric Vehicles
As of now, Ford offers three electric vehicles to choose from – the Ford Mach-E, E-transit van, and F-150 Lightning. Jim Farley aims to produce 600,000 EVs annually by 2023 which will include 50,000 F-150 Lightnings and 200,000 Ford Mach-E crossovers. In comparison, Tesla has already delivered more than 930,000 EVs in 2021. However, Ford is gearing up to produce and distribute more than 2 million EVs globally by 2026. In addition, Ford is accelerating the manufacturing of its electric vehicles much faster than its competitors – Rivian Automotive and General Motors.
Ford is still in the preliminary phase of its endeavor. But despite its infancy, Ford EVs are showing great potential. According to Farley, Ford has already manufactured 2,000 F-150 Lightnings during the vehicle’s first two weeks of production. And throughout the rest of 2021, the company sold roughly 64,000 Mustang Mach-E globally which includes 27,140 in the USA alone. Whereas their rivals – Rivian Automotive – only produced about 2,500 electric vehicles during their first quarter.
Top-class Talent Acquisition
Ford understands that investments and manufacturing alone are not going to help them compete against Tesla. It also needs talented technicians and world-class executives to pull off such a monumental venture for the company. Doug Field, the former head of Apple’s automobile project and a prominent executive at Tesla, where he engineered the Tesla Model 3, was the first to join the fray. He was appointed as the company’s chief of advanced technologies and embedded systems.
Ford has also hired Alan Clarke, Tesla’s former engineering director, to work on advanced EV research. Clarke has been with Tesla for 12 years and was in charge of various engineering design aspects for the Model S and Model X. He created the iconic door handles and was also in charge of designing the suspension and steering system for the Model S. Clarke served as director of the new program engineering for the last four years, and he will most likely have a very similar role at Ford.
Apart from that, the company has also hired a large number of engineers who are specialized in a variety of different advanced technological fields such as battery chemistry, electric vehicle software, and artificial intelligence.
Rebooting Ford’s Iconic Brands
What sets Ford apart from Tesla is its rich history of 118 years as being one of the most prominent vehicle manufacturers in the world. And Farley realizes this and intends to take full advantage of it. This can be seen in Ford’s vehicle model and branding strategy.
Ford is segmenting their vehicle models into two parts. The first is the Ford Model e. The Ford Model e will comprise Ford’s most innovative electric vehicle design and engineering, the likes of which fans of Tesla are more familiar with. And the second segment is the Ford Blue. This segment will primarily focus on the legacy models of Ford which the company will reboot to meet modern EV standards. The Ford Blue segment will consist of the iconic F-series, Maverick, and Ranger trucks, the Bronco and Explorer sport utility vehicles, and the legendary Mustang. This strategy of segmenting Ford’s models is a brilliant move by Farley. Not only are they staying true to their core fans, but they are also offering new and innovative designs to EV enthusiasts.
Can Ford Challenge Tesla for the Crown?
Yes, Ford can challenge Tesla for the crown of EV supremacy. The veteran automobile manufacturer has the necessary resources, talent, legacy, brand value, and leadership to become a dominant force in the EV market. Cause we all know that creating hype is temporary but brand loyalty plays a major role in long term growth! However, pulling it off is a whole other ball game. Tesla has stayed the market leader in electric vehicles for years now. But Ford can see the chinks in Tesla’s armor. If Ford can properly execute its game plan, then we could possibly have a new king of electric vehicles.