Ford expects 40% of global sales to be generated with electric vehicles by 2030
Ford previously announced plans to spend $ 22 billion on electrification efforts and recently announced plans to build two new battery factories in a joint venture with Korean battery maker SK Innovation.
Ford said it was determined to catch and overtake its competitors if the industry switched to electric vehicles.
“Our goal is to lead the electric revolution. I really mean it,” said CEO Jim Farley on Wednesday in an interview with investors and analysts. When asked about GM’s goal of being all-electric by 2035, and whether Ford has a similar target date, Farley declined his rival’s promise, which GM CEO Mary Barra called a “claim” for the company.
“We’re talking about our entire fleet. No asterisk,” Farley said. “We think it advisable not to focus on striving but on our actual plans.”
Farley predicted that Ford will be able to gain equal or improved market share by switching to electric vehicles. So far, 70% of Mustang Mach-E buyers have come to Ford from other automakers, according to Lisa Drake, chief operating officer of Ford’s North American unit.
Farley admitted that the company’s financial performance was not as good as it should have been in recent years. Outside North America, Ford lost an average of $ 2 billion a year over the past three years. However, he pointed to the profit that Ford posted overseas in the first quarter of this year and said the company should now be able to achieve an 8% profit margin excluding interest, taxes and special items by 2023.
Farley predicted that the cost of building electric vehicles will decrease as production increases, especially electric vehicle batteries, which make up a significant portion of the price of building an electric vehicle. Farley predicted that battery costs will decrease by 40% by the middle of this decade. So the switch to electric vehicles will be able to “achieve higher profitability … compared to today’s ICE [internal combustion engine] Offerings, “said Farley.
Investors are more interested in helping automakers with ambitious EV plans than traditional automakers. Tesla is by far the most valuable auto company, despite making a fraction of the sales and profits of traditional automakers. Tesla’s market value is roughly the same as the five largest global automakers combined.