Ford announced today that it plans to almost double its electric vehicle investment to $22 billion through 2025 – raising the stakes in the race to electrification.
During its Q4 2020 earnings results, Ford CEO Jim Farley made the announcement, which specifically calls for an increase of planned investment in electric and autonomous vehicles to $29 billion through 2025.
The vast majority, $22 billion, will got to electric vehicles.
We are accelerating all our plans – breaking constraints, increasing battery capacity, improving costs, and getting more electric vehicles into our product cycle plan. People are responding to what Ford is doing today, not someday. The Mustang Mach-E, he said, is receiving great customer and critical reviews, and will be followed by the first E-Transit commercial van (late 2021) and an all-electric F-150 pickup (mid 2022).
The CEO claimed that Ford is “all in and will not cede ground to anyone” in the electrification race.
Farley explained that electric vehicles are going to be especially important for Ford’s Lincoln luxury brand and the Transit commercial lineup.
Recently, Ford announced a $1.8 billion investment to produce “fully battery electric vehicles” in Canada at a factory where the automaker is producing Lincoln SUVs.
The automaker is also already producing the Mustang Mach-E at its factory in Mexico, and it started construction on a new factory to build its upcoming F150 electric pickup next to an existing plant in Michigan.
However, those investments were already planned, and Ford didn’t elaborate on how it would spend the additional ~$10 billion toward electric vehicles in the next five years beyond what was previously mentioned.
We expect further announcements to follow since Ford is currently only selling a single all-electric vehicle and it has only officially revealed two more programs: the Ford F150 Electric and the E-Transit electric van.
In order to support the volume production of electric vehicles, Ford is also going to have to secure battery cell supply.
In the past, the automaker has been reticent in directly investing in battery cell production and instead, it was fine with relying on suppliers, but the new management has opened the door to changing that strategy recently after both GM and Tesla have invested in their own battery cell production.
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