Ford CEO Farley explains why the brand isn't going all-electric like GM

video

FOX Business Flash top headlines for September 15

Check out what’s clicking on FoxBusiness.com

Ford is putting its foot on the gas pedal.

The automaker has committed over $50 billion to electrify its lineup with new products and the factories needed to build them, but Ford CEO Jim Farley said it is also continuing to spend on future internal combustion engine (ICE) models like the 2024 Ford Mustang unveiled at the Detroit Auto Show and the upcoming F-Series Super Duty pickups.

"We’re investing in ICE segments where we’re dominant and where we think, as competitors leave the segments, we can actually grow," Farley told FOX Business.

"I find it intriguing that we’re portraying the future of our industry as monolithic. That’s not how it goes. That’s not how it’s going to manifest itself."

IN OR OUT: FORD GIVES DEALERS ULTIMATUM ON EV SALES

Ford CEO Jim Farley said the company continues to invest in internal combustion engine models. (Bill Pugliano/Getty Images / Getty Images)

In March, Ford split its core business into the Ford Blue division, dedicated to ICE and hybrid vehicles, and the Model e division, which is focused on fully-electric products like the F-150 Lightning and Mustang Mach-E, highlighting its commitment to continue to pursue both paths in contrast to some competitors, like General Motors and Volkswagen, who have committed to all-electric futures in the U.S. It has even given its dealers the option of just selling ICE models if they do not want to make the investments required to support EV sales.

"Not all segments will go to electric at the same time, and some may never," Farley said, specifically calling out the Heavy Duty truck classes that the F-Series Super Duty participates in.

"If you’re towing a fifth-wheel trailer, or you have a bucket body on the back of a chassis cab Super Duty, an electric vehicle makes almost no sense," he said.

Ford CEO Jim Farley and Ford Executive Chairman Bill Ford helped unveil the 2024 Ford Mustang, which will not be offered with hybrid or electric powertrains. (GEOFF ROBINS/AFP via Getty Images)

The auto industry is facing a new challenge with California's decision to require 35% of all light vehicles sold in 2026 to be all-electric, with that number rising to 100% by 2035.

SOME STATES IN LIMBO AFTER CALIFORNIA'S NEW ELECTRIC CAR MANDATES

"Look, we’ll do what’s required, and we’re going to grow our EV business to two million vehicles in four years and most of that will be conquest, but we want these loyal customers who own F-150s and Broncos and Mustangs to continue to have a great experience," Farley said.

Jim Farley has overseen a dramatic transformation at Ford as it invests in electric vehicles. (Photo by Bill Pugliano/Getty Images / Getty Images)

"If they’re not able to be sold in California, so be it, but there are plenty of other places to drive a Mustang in the United States."

The recently updated federal electric car tax credit program has also thrown a wrench into the works by requiring that battery packs and their materials be sourced from suppliers located in the U.S. or within free trade partner countries to qualify for the full credit, while most battery material production currently takes place in China and other countries outside that block.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Farley said he is not sure when Ford will be fully compliant with the new rules, but that it had already been taking steps to domesticate that part of the business.

"We’re moving as much of that raw materials processing back to the U.S," Farley said.

"It’s not just because policy will reward us financially, it’s because we want to help build a battery raw material processing ecosystem here in America. We’ve learned over the 120 years of the company that works best."

Source: Read Full Article