Ford Motor Co to Increase its Investment in Electrification & Autonomous Driving to $29 Billion Through 2025
【Summary】After Ford’s U.S. rival General Motors announced in November that it will increase its investment in electric vehicles to $27 billion, Ford will now increase its own investment as well. The automaker said on Thursday that its upping its investment in electrification and autonomous driving technology to $29 billion, representing a massive investment in the automaker’s future as both U.S. automakers prepare to take on rivals Tesla, Volkswagen, BMW in the EV segment.
With electric automaker Tesla Inc. now the world's most valuable car company, the auto industry's rapid switch to EVs is putting legacy automakers like General Motors and Ford Motor Co in a position where they are scrambling to catch up to Tesla, or risk losing sales over the next decade as the rest of the world's automakers electrify their model lineups.
After Ford's U.S. rival General Motors announced in November that it will increase its investment in electric vehicles to $27 billion, Ford will now increase its own investment as well.
The automaker said on Thursday that its upping its investment in electrification and autonomous driving technology to $29 billion, representing a massive investment in the automaker's future as both U.S. automakers prepare to take on rivals Tesla, Volkswagen, BMW in the EV segment.
Ford's planned $29 billion investment comes after the company posted a $2.8 billion dollar loss in the fourth quarter of 2020. Ford's loss is significant, although the quarter included several previously disclosed charges related to a recall, pension obligations and the closure of the automaker's Brazilian manufacturing operations.
2020 was a difficult year for the world's automaker's who were forced to scale back production as the economy stalled in the second and third quarters due to the global pandemic.
For the year, Ford reported a net loss of $1.3 billion after saying it expected a full-year profit of between $600 million and $1.1 billion. Ford's total revenue fell to $127 billion in 2020, down from $156 billion in 2019.
But the loss of revenue in 2020 will not affect Ford's massive investment in electrification.
Ford said it was "doubling down" on connected electric vehicles and said it will invest $22 billion in electrification through 2025, nearly twice what it had previously committed to EVs.
Ford also said it would invest another $5 billion in autonomous driving from 2021 to 2025 on top of the $2 billion the company already made so far.
Ford's Mach-E SUV is the automaker's first fully-electric vehicle.
On a conference call with analysts on Thursday, Ford's Chief Executive Jim Farley said "We are accelerating all our plans," including increasing battery capacity and adding more electric vehicles to its future portfolio.
Farley said that the $22 billion investment in electrification does not include potential investments in battery production. Ford has not confirmed if it will set up its own battery manufacturing business or establish a joint venture with another company, like Tesla and General Motors have done.
Tesla' battery partner is Panasonic, while GM and South Korean battery maker LG Chem are investing $2.3 billion in a joint venture battery factory in Ohio to build GM's new Utium EV batteries.
Farley has previously told Reuters that the company was considering making its own battery cells. On Thursday, Farley said that Ford will have more announcements soon about any potential battery partnerships.
Ford's updated EV plans reflect that of its chief U.S. rival General Motors, which said it plans to offer 30 new EVs globally by 2025. GM aims to sell 1 million EVs in the U.S. and China within the next five years.
Ford's first mass-market EV is the Mustang-inspired Mach-E SUV, which will mark the company's entrance in the EV space. Deliveries of the Mach-E to customers will begin in the upcoming weeks.
resource from: Reuters
Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.
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