Ford to Run EV, Internal Combustion Divisions Separately

March 2, 2022by Michelle Chapman, Associated Press Business Writer
Ford to Run EV, Internal Combustion Divisions Separately
In this photo, made on Thursday, May 6, 2021, a 2021 Ford Mustang Mach-E is seen as it is charging at a Ford dealer in Wexford, Pa. (AP Photo/Keith Srakocic)

Ford said that it will run its electric vehicle and internal combustion divisions as two separate businesses to accelerate its adaptation of new technology and the Detroit automaker said Wednesday that its shift to electric vehicles is accelerating.

Ford plans a major restructuring with two distinct but strategically interdependent auto businesses – Ford Blue focusing on traditional combustion engines and Ford Model e, which will develop electric vehicles.

“We are going all in, creating separate but complementary businesses that give us start-up speed and unbridled innovation in Ford Model e together with Ford Blue’s industrial know-how, volume and iconic brands like Bronco, that start-ups can only dream about,” said CEO Jim Farley, who will head the electric vehicle division.

A pair of EV start-ups, Lucid Group and Lordstown Motors, released disappointing production projections this week, highlighting how difficult it is to secure materials and scale up in the auto industry.


But Ford is also competing with EV heavyweight Tesla and another traditional automaker, General Motors, which is vowing an even faster transition to electric vehicles. GM went so far as to change its logo, with the ‘m’ in the logo underlined to look more like an electrical plug.

Ford has already charged into the development of electric vehicles with the Ford GT, Mustang Mach-E SUV and F-150 Lightning pickup. ford also operates an EV division in China.


On Wednesday, Ford said that it now expects that half of its vehicles to be electric by 2030. Less than a year ago, the company announced a goal of going 40% electric by then. It also said that it will produce more than 2 million electric vehicles annually by 2026, representing about a third of its global volume.

Ford Blue will provide hardware engineering and manufacturing capabilities for the entire company. Ford Model e will develop software and connected vehicle technologies and services.

Ford anticipates spending $5 billion on electric vehicles this year, including capital expenditures, expense and direct investments.

Farley, in addition to heading Ford Model e, will continue as CEO of Ford Motor Co. The president of Ford’s Americas & International Markets Group, Kumar Galhotra, will become president of Ford Blue.


“We are going to be hyper-competitive on costs and make quality a reason to choose Ford,” Galhotra said. “And by doing all that, Ford Blue will be an engine of cash and profitability for the whole company.”

Shares of Ford rose more than 3% before the opening bell.

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