The race towards electrification is forcing many automotive companies to think outside the box when it comes to meeting the rapidly changing EV landscape. Ford CEO Jim Farley appeared to drop a potent bombshell of a hint on one idea Ford is possibly considering, breaking up the company.
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When one hears an idea as extreme as Farley's, it may cause them to perhaps gasp in surprise. Ford is a massive powerhouse and has long stood as one of the most powerful family-run corporations on the planet. However, could separating various aspects of the company help Ford become a more powerful EV contender in the long run?
Two Distinct Slices Of The Ford Empire
Farley's idea emerged into the spotlight during a shareholders call with investors on Thursday when Farley inadvertently presented a potent argument for the potential breakup of the Ford empire into smaller separate entities. In this instance, the division would be focused on the EV and ICE-powered vehicles, with the ICE-powered side of the business potentially being spun off into a separate company that would be away from the EV vehicle sales business.
In theory, this division would help Ford have more sources available for EV development while also keeping the manpower needed for BEV and other EV projects versus having to consistently shuffle between ICE and EV projects. Farley was later asked about whether the ICE business should be carved out to protect the EV side of the business from potentially stranded assets, Farley revealed that he's already running the company under this structure.
EVs Have Simpler Engineering
In addition to floating the idea of carving up the company, Farley also revealed some of the engineering advantages that an EV has over an ICE-powered vehicle with the Ford F-150 Lightning serving as the proverbial example. Farley claimed that while the F-150 Lightning only comes in one cab and bed setup, an ICE-powered F-150 offers close to 40 different combinations for customers to choose from.
This increased complexity makes engineering more difficult and it also raises the cost of production too since the line will have to be configured for multiple truck styles versus being tailored to produce one version of a model like the F-150 Lightning.
For now, it appears that Farley is somewhat of a rouge when it comes to the idea of breaking up the company, with neither Stellantis nor GM considering a similar move. GM, in particular, is undertaking its own measures to maximize its EV footprint but neither GM CEO Mary Barra nor other GM reps have publicly revealed an idea similar to Farley's.
Instead, GM is embarking on a strategy to boost its EV capabilities with the company building new battery cell plants and undertaking bold investments to rapidly expand EV production capability.
Photo Credit: Ford Motor Company
Carl Malek has been an automotive journalist for over 10 years. In addition to his specialization with Ford, he grew up in a General Motors household and is extensively familiar with their products too. Contact Carl on Twitter at @CarlMalek3, on Instagram and Facebook for automotive news to send news tips.
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