Ford electric pick-up in US production: The high demand for the new electric model F 150 “Lightning” surprised the American car manufacturer.
(Photo: Rebecca Cook)
Dusseldorf The US car company Ford is giving itself a new structure in response to the rapidly growing importance of the electronics business. As the company announced on Wednesday in Dearborn, Michigan, the auto business will be split into two operating units.
In the future there will be “Ford Blue” for traditional cars with internal combustion engines and “Ford Model e” as a second unit for the electric sector. In Europe and Germany, the conversion towards electromobility should be implemented faster than in the USA.
In the US, there was speculation that Ford could completely spin off the new electronics business and list it as an independent company. The second-largest US car company with the new structure is now rejecting these speculations. However, both new areas are to be given a high level of autonomy and, starting next year, will each be introducing their own separate profit and loss account.
In contrast to other car manufacturers such as the Volkswagen Group, Ford had waited longer to convert to electromobility. However, under CEO Jim Farley, who took office in October 2020 in Dearborn near Detroit, the US automaker is increasingly turning into an electric supplier.
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“We have made great progress in a short time,” said Farley when presenting the new corporate structure. He spoke of an “exciting new era” of electric and digitized vehicles that Ford is about to enter. Farley didn’t mention Tesla by name, but the Ford CEO said his company’s new structure will continue to outperform start-ups.
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Other car manufacturers are also working on new corporate structures, with which they are giving greater importance to the electronics business in particular. A few days ago, Renault announced plans to split it into a combustion and an electric division. This is based on the expectation that battery-powered vehicles will become increasingly important in the world’s most important car markets. Ford is betting that electric mobility will grow more strongly in the future, especially in North America.
Higher returns with electric cars
In any case, Ford wants to achieve higher returns with new electric cars in a comparatively short time. In addition to the new structure, the US group announced an increase in its medium-term return targets on Wednesday. By 2026, Ford aims to achieve an operating return of 10 percent. In 2022 it is expected to be eight percent. Originally, Ford’s plans envisaged that this margin would not be reached until next year.
In 2026, Ford wants to produce around two million electrically powered cars worldwide, which would correspond to a third of the total production volume. By 2030, around half of Ford vehicles will be electrified. The US group hopes that it can increase its global market share with electric cars and thus win new customers.
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Germany and Europe play a special role in the expansion of electric mobility in the Ford Group. In this country and in the other European markets, electrification should progress much faster than in the USA. From 2026 onwards, Ford only wants to sell cars in Europe that are at least partially electrified. From 2030 onwards there will only be fully electric models.
“Our industry is changing dramatically,” emphasized Ford Europe boss Stuart Rowley in an interview with the Handelsblatt. With the new structure and the division into two areas, Ford is focusing “like with a laser” on the rapidly growing importance of electromobility. “Ford is changing faster in Europe,” he added.
However, the US group will not give a phase-out date for internal combustion engines for global business. This is mainly due to the USA, where electric cars are also becoming increasingly important. But especially in rural areas with a small population, there will be vehicles with combustion engines for much longer than in Europe. Ford is also continuing to work on making its internal combustion engines more environmentally friendly.
According to Rowley, the new “Ford Blue” division will only exist in Europe for a transitional period. In the European business, the US group will soon only need the “Ford Model e” electronics division. Former Audi sales manager Martin Sander, who is also in charge of the German business, is to take over management in Europe on June 1. Doug Field, who was poached from Apple last year by Ford and who previously also worked at Tesla, will become global electronics chief.
The new structure also led to personal changes for European boss Rowley: At group level, he was promoted to Chief Transformation and Quality Officer. This will involve a move to the headquarters in Dearborn for the foreseeable future, probably before the end of this year. He would then give up his post as head of Europe.
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