Ford executives will unveil the company’s new expansion plan at a “fireside chat” with auto analyst Rod Lache, Feb. 15 at the Auto Consumer Conference 2023 in New York City.
Ford has faced rocky roads in its transition to EVs, its most recent earnings report showed. To battle these challenges, Ford CEO Jim Farley is taking the business by the horns and implementing Ford+.
The scheme began last year as the automaker split into three segments covering ICE, EV and commercial products, but at the upcoming meeting, the rest of the changes will be revealed, as Farley and team will tell how they plan to reduce costs and improve quality.
A change in business plan should come as no surprise. Farley recently said, “We left about $2 billion in profits on the table that were within our control.” The CEO plans to “correct that with improved execution and performance.”
The first part of Ford’s new plan was splitting into Ford Blue, its ICE division; Ford Model e, dedicated to EVs; and Ford Pro, for commercial vehicles. But as previously explained by Farley, it will also likely be forcing changes in Ford’s sales model. Specifically, Ford plans to reduce operating costs at its dealers, increase online ordering and achieve a profit margin of 8% across the company.
But Ford dealers are also changing what cars they sell and how they interact with customers. The recently rolled out Ford Model e certification program forced prospective dealers to get “certified” to sell EVs by investing in EV charging equipment and abiding by a new set of terms that would guide customer sales, no more markups and no more price haggling.
Finally, quality has become a consistent problem for Ford. Over the past two years, the company has been forced to address a wave of recall issues stemming from multiple new model lines. Through a change in quality control leadership, improvements have already been seen. Still, there is no doubt Farley aims to continue improving to reassure customers and reduce recall costs.
It remains unclear what other changes the group of executives have in store for the historic automaker, but what is clear is it will need to change if it hopes to compete in the increasingly competitive EV market. Yet, with ambitious goals and a head start in the EV market compared to its traditional rivals, Farley has undoubtedly placed the brand on the right track.
Abby Andrews