Ford CEO Jim Farley said that the company is trying to make as many of its own parts for its electric cars as possible to offset the impact of the 40 percent reduction in the number of workers needed to build electric cars compared to the projected reduction in fuel vehicles.
Besides making sense for the business, preserving jobs and the workforce is another reason Ford wants to make more parts in-house rather than sourcing them from suppliers, Farley said. Ford plans to build such a business itself, rather than relying on acquisitions, he said.
Currently, the motors and batteries for Ford’s electric Mustang Mach-E are purchased from other companies, Farley said, adding that in the future that will no longer be the case and bringing the production of electric vehicle motors, batteries and other components in-house is necessary to retain jobs and be more competitive.
Ford is building a lithium-ion battery plant in central Kentucky, called BlueOvalSK, and a large 3,600-acre campus in western Tennessee through a joint venture with SK Innovation of South Korea, which announced plans for an $11.4 billion investment late last year.
In addition, Farley has brought in executives from outside the auto industry to lead electrification and software development efforts. But he said Ford must do a better job of developing executives from within its ranks, saying, “We can’t keep hiring from the outside.”
Tesla Inc. currently makes many components for its electric cars, including batteries, and Tesla’s profit margins are currently better than Ford and many other older automakers.