Ford has hit a few snags in its attempt to turn a 120-year-old company into an electric-car powerhouse.
But as Chief Executive Jim Farley pushes the auto giant to compete with the likes of Elon Musk’s Tesla and China’s BYD, he said he The recipe for success has been found, and it’s surprisingly basic.
“I’ve found that people who buy electric cars just want something really good,” Farley said at an event Wednesday. “They don’t want a science project, they want a really great product.”
Speaking with Uber CEO Dara Khosrowshahi at GE’s “Lean Thinking” event in New York, Farley recalled the original design for the abandoned Mustang Mach-E in 2017 when he saw The project, thought it looked too much like a Toyota Prius. He mocked the design as “a joke”.
“I saw it and I thought, no,” Farley said. “We’ve got to focus on what we’re really good at, like Mustangs and pickup trucks.”
That decision appears to be paying off: Mustang Mach-E sales soared 61% year-over-year in August, making it the second-best-selling electric SUV in the U.S. behind Tesla’s Model Y, according to Electrek.
However, driving an electric future has proven to be an expensive bet.
In July, Ford forecast that its electric vehicle division (Ford Model e) would lose $4.5 billion by 2023, a 50% increase from the loss forecast in March.
Charging a car isn’t easy, either, as Farley experienced first-hand during his recent test drive of the F-150 Lightning on Route 66.
After waiting 40 minutes for a low-speed charger to charge the battery to 40%, the CEO admit In a video posted to X (formerly known as Twitter), the “pretty challenging” process is a “very good reality check”.
Charging speeds should increase starting this spring, as Ford and GM drivers will be able to use Tesla’s Supercharger network, thanks to a new partnership announced in June.
Competing with Tesla and itself
Farley likened Ford’s early EVs to “the first product in a nine-inning game.” He said that the next stage of development requires the company to follow the following principles: improveThe Japanese model of continuous improvement popularized by Toyota, Ford’s rival and Farley’s former employer.
“We actually had to have a revolution in the engineering of the product to simplify it and reduce the cost,” Farley explained recalling the company restructuring last year.
To adapt to the changing automotive landscape, Farley divided the company into three divisions: Ford Model e, centered on the future of electric vehicles; Ford Blue, focused on the internal combustion engine business; and Ford Pro, the existing commercial division.
“I don’t have the time to educate internal combustion engine people on electric vehicles and digitally embedded vehicle architectures,” Farley explained. “I had to build an organization that was almost competing with each other, with some dependencies on each other.”
Farley thinks the move will help cut costs in Ford’s manufacturing and supply chain, “so that I can compete when Tesla dropped $20,000 in price, which they have now.”
While the auto giant is still tweaking its lineup of second-generation electric vehicles, Farley said the company’s changing mindset is helping it move forward.
“Sometimes kaizen is just small, day-to-day improvements, and sometimes kaizen means completely rewriting your entire engineering approach,” he said.