Ford Motor Company (NYSE: F) expanded on its electric vehicle (EV) plans and connected services at its “Delivering Ford+” Capital Markets Day held today morning.
Ford was a laggard amongst its peers for the race to build automated driving systems and electric vehicles but has been increasingly unveiling its plans to compete better in the EV space, which has helped boost its stock.
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Shares of Ford are up nearly 9% today on the news that the company will boost its EV investments. Stock is up 63% year-to-date and 140% for the trailing one-year period.
Let’s dive into some of the highlights from the capital markets day.
Ford announces a major increase in its electrification spending
The company is planning to spend $30 billion on vehicle electrification by 2025, up from a previously stated investment target of $22 billion. The bulk of the increased investment will go towards the automaker’s battery production plans.
Ford will form a new joint venture, BlueOvalSK, with SK Innovation to manufacture batteries at two plants in the U.S. for its Ford and Lincoln vehicles. It will also set up Ford Ion Park, a global center of battery excellence.
On the company’s new strategic direction, Ford CEO Farley said:
“I’m excited about what Ford+ means for our customers, who will get new and better experiences by pairing our iconic, world-class vehicles with connected technology that constantly gets better over time. We will deliver lower costs, stronger loyalty and greater returns across all our customers.”
While transitioning to an electric future, the company expects to deliver an 8% adjusted EBIT (earnings before interest and taxes) margin in 2023.
40% of Ford’s global vehicle volume to be fully electric by 2030
Even though Ford has been behind rivals General Motors (NYSE: GM) and Tesla Inc. (NASDAQ: TSLA) in the EV space, it is moving fast by laying out ambitious plans and investments to support those plans. The company expects that 40% of its global fleet will be electric by 2030.
The company has been beefing up its electric vehicle fleet Mustang Mach-E, recently launched F-150 Lightning and E-transit commercial vehicles, which will hit the roads later this year, according to the automaker. F-150 Lightning has received 70,000 customer reservations since the vehicle launch last week.
Dedicated business for commercial customers
Ford will establish Ford Pro, a global vehicle services and distribution business within Ford that will cater to commercial and government customers. The company sees the $47 billion addressable market that can be filled by Ford Pro through its hardware and adjacent and new services
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