United States based car manufacturer Ford Motors Co. (F) has ruled out any possibility of separating its electric vehicle or gasoline powered vehicle businesses. This was revealed by the company’s chief executive officer, Jim Farley, who says they are not planning any spin-off.
“We have no plans to spin off our electric business or our ICE business. We know our competition is Nio and Tesla, and we have to beat them, not match them. And we also have to beat the best of the ICE players,” said Farley.
A group of investors has been advocating for the company to spin-off its electric vehicle business so as to be in a better position to compete with world-leading EV maker Tesla Inc.(TSLA) which is currently world’s most valuable automobile manufacturer.
The CEO believes the company can reduce its operational costs of its traditional ICE (internal combustion engine) business via better quality, lower structural costs and reduced vehicle complexity.
“We have too many people, we have too much investment, we have too much complexity and we don’t have expertise in transitioning our assets. That’s the simple answer. There’s waste,” said the CEO.
Farley was making these sentiments during a Wolfe Research conference appearance in which he said Ford needs to scale up its expertise and labor force in the electric vehicle business for it to equally compete with Tesla.
“To get the margins on electric vehicles that we see at a company like Tesla, we need to have real experts that can drive that scale. Ford needed to hire more people who work in the areas of electrical components, advanced electrical architectures and the digital customer experience,” added the CEO.