Ford will spend a whopping $20 billion to reorganize its company for the electric future, according to Bloomberg† The automaker is also considering divesting some of its EV business as a special acquisition company (SPAC) to attract more investment. Ford has previously stated that it would spend $30 billion on developing electric and autonomous vehicles by 2025.
Ford is reportedly putting former Apple and Tesla president Doug Field in charge of the reorganization, which will include converting its factories from gas-powered to electric car production and hiring more engineers. (General Motors, which reports its fourth-quarter results Tuesday night, recently announced an initiative to hire 8,000 people to bolster its EV efforts.)
Ford is engaged in a high-stakes race against its rivals as the auto industry struggles to overtake Tesla
Ford is engaged in a high-stakes race against its rivals as the auto industry struggles to overtake Tesla, the world’s most valuable automaker and best-seller of EVs. While Ford sells more F-series trucks each year than Tesla’s total production, investors have rewarded Elon Musk’s vision for an all-electric future with a significantly higher stock price and greater confidence in his company’s prospects.
Ford CEO Jim Farley is trying to change that story by showing his company can compete. Ford recently announced that it will double production of its future electric pickup truck, the F-150 Lightning, and production of the Mustang Mach-E, with the expectation that it will reach more than 200,000 units per year by 2023. Ford’s electric van, the E-Transit, will also go on sale at the beginning of this year.
As long as they start shipping on time, Ford will join Rivian and GMC as the only automakers with an electric pickup on the market. (Rivian began shipping its R1T pickup in October, with the first Hummer EVs reaching customers by the end of the year.) Tesla’s long-promised Cybertruck has been pushed back to next year, and CEO Elon Musk has said his company won’t start. making them in large volumes until 2023.
As for a potential SPAC, Bloomberg reports that Ford is considering divesting a “small” portion of its EV business, potentially targeting its lower-volume vehicles. GM had reportedly been thinking about an EV SPAC for a while before finally coming up with the idea† A Ford spokesperson declined to comment on “rumours and speculations”.
SPACs have cooled in popularity as many of the EV startups that have gone public through reverse mergers have caught the attention of federal regulators. The SEC is already investigating the SPAC mergers that have turned Lordstown Motors, Canoo and Nikola into publicly traded electric vehicle startups. In particular, the agency has focused on the validity of the financial forecasts these companies made when they announced the mergers, as well as any claims they have made about the pre-orders collected for their vehicles.
The person reportedly put in charge of this massive shift is Doug Field, who was VP of special projects at Apple, where he was the de facto head of the company’s confused efforts to create an autonomous electric car – well known as Project Titan. He previously worked at Apple, where he was once the VP of Mac hardware engineering, but he left the company in 2013 to become Tesla’s chief vehicle engineer, where he helped oversee the tricky development of the Model 3 sedan. He left Tesla in 2018 and returned to Apple.
Farley has set out to emulate Tesla in many ways, not just in the shift to EVs. The company is backing a business plan it calls Ford Plus and plans to make more cars that are fully networked and can be updated over-the-air, such as Teslas. Ford has also said Google’s Android will power infotainment systems in “millions” of its cars by 2023.