Ford is thinking big about its EV plans, and as per its CEO Jim Farley, the automaker plans to be profitable building EVs in four years.
The statement comes as Ford, like other legacy automakers, is stuck between producing internal combustion and EVs for the broader market.
However, market analysts have been questioning Ford’s efforts on the EV side.
So, in response, Farley looked to settle concerns during Ford’s Q2 Earning’s Call.
Farley noted that the company is rethinking how they develop its vehicles and how it keeps them fresh each year.
Taking a page from Tesla’s playbook, Farley spoke about upgrading the vehicles with software, batteries and motors to keep things up to date.
We have an opportunity as we go digital with these EVs, to simplify our body engineering and put the engineering where customers really care. And it’s not a different fender. It’s software. It’s a digital display technology. It’s a self-driving system and the [autonomous vehicle] tech. And of course it’s going to be, in some cases, more powerful motors.
By skipping body redesigns and relying on software updates, Ford believes it can improve its operating margin to 10 per cent by 2026.
In addition, Ford is rethinking its dealership model and tweaking the process.
With the current dealer model, Ford is at a $2,000 disadvantage to Tesla on a per vehicle scale.
To help combat that, Ford is considering lowering dealer inventories on site and instead using dealers as a meeting point for test drives and questions.
Clients can then buy the vehicle online. With the dealer completing the delivery, and providing service after the sale.
Farley believes this change will keep dealers profitable and reduce the competitive disadvantage Ford is facing.