[Asia Economy Reporter Park Byung-hee] Ford Motor Company plans to invest up to $20 billion (approximately 24.18 trillion KRW) additionally in the electric vehicle sector, Bloomberg reported on the 1st (local time).
According to insiders, Ford plans to invest an additional $10 billion to $20 billion over the next 5 to 10 years to convert its current internal combustion engine vehicle production plants into electric vehicle production plants. This investment is in addition to the electric vehicle investment plan announced by Ford in May last year. In May last year, Ford announced the Ford Plus plan, which is based on investing $30 billion in the electric vehicle sector by 2025.
An anonymous source said Ford is also considering spinning off part of its electric vehicle business. The source explained that by spinning off electric vehicle models with low production volumes, Ford plans to focus on mass production models. Ford also plans to hire new personnel in battery chemistry, artificial intelligence (AI), and electric vehicle software sectors.
Mark Truby, Ford’s Chief Communications Officer (CCO), stated in an email, "We are executing the Ford Plus plan to transform Ford to thrive in the era of electric and connected vehicles," but added, "We cannot comment on speculative matters."
The business restructuring, including additional investment in electric vehicles, is being led by Doug Field, who joined from Apple last September. Field held senior positions at Tesla Motors during the development of the Model 3 and later served as the head of Apple’s Apple Car project before moving to Ford last year. Field is known to be closely communicating with Ford CEO Jim Farley to adjust the electric vehicle business investment plans.
Since CEO Farley took office in October 2020, Ford’s transformation into an electric vehicle company has accelerated. The Ford Plus plan announced by CEO Farley has attracted investor attention, and last month Ford’s market capitalization surpassed $100 billion for the first time in history. However, this is still far behind Tesla’s market capitalization of $935 billion. Tesla already surpassed a $1 trillion market capitalization in October last year.
CEO Farley has frequently expressed admiration for Tesla CEO Elon Musk. In an interview with Bloomberg TV last week, Farley said, "I sincerely respect Tesla’s overcoming difficulties and achieving success," adding, "Considering Tesla’s production scale, they are making cars that cost over $10,000 per unit, and I like that kind of business."
Ford plans to increase electric vehicle production to 600,000 units by 2024 and raise the share of electric vehicle sales to 50% by 2030.
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