On September 22, Ford Motor Company announced that it will be shifting its plans into gear. Part of the strategy is a Ford restructuring of its vehicle development and supply chain operations.
The company also shuffled its top executives after announcing that supply chain shortages have affected its production lines. However, the company will go ahead and build 45,000 vehicles with missing parts, mostly trucks and SUVs.
What are Ford’s plans for the future?
The Dearborn-headquartered automaker is keen on accelerating its Ford+ plan that will eventually transform the company’s global supply chain management.
“As we enter an intense period of execution for Ford Model e and our $50 billion investment in breakthrough electric and digital vehicles, Doug, Lisa and Chuck are taking on larger roles and building out very capable teams,” said Jim Farley, Ford president and CEO. “Developing and scaling the next generation of electric and software-defined vehicles requires a different focus and mix of talent from the accomplished Ford team and many exciting new colleagues joining our company.”
The car manufacturer said that it expects to incur $1 billion in additional costs due to inflation and supply chain issues. The automaker anticipates third-quarter adjusted earnings before interest and taxes to be in the range of $1.4 billion to $1.7 billion. The announcement spooked investors and led to Ford’s stock hitting a 11-year-low. Ford’s shares are down nearly 38% this year.
Demand for vehicles continues to be strong despite issues with procuring semiconductor chips.
Is Ford restructuring?
The company is keen to push Farley’s plan for growth and value creation into high gear.
Ford has plans to turn at least half of its global production electric by 2030. But it needs to keep selling gas-powered vehicles to fund its expensive transition. The company is taking the effects of climate change seriously and even partnered with the Climate Museum to support major work illustrating the effects of climate change. As governments push to phase out combustion vehicles, automakers are working on supply chain management to secure their future. Most automakers are aiming to provide affordable EVs despite rising cost of materials.
Ford is keen to build an enviable fleet of EVs from both Ford Model e and iconic Ford Blue internal combustion vehicles. Earlier this year, Farley had done a small Ford restructuring by splitting the company into Ford Model e to develop electric vehicles, and Ford Blue to handle internal combustion cars, trucks, and SUVs.
Vice President Jim Baumbick will be overseeing the development of all Ford Blue products and lead product development for all of Ford. Farley praised him for his past work on the Mustang and Ranger series, and in helping the company achieve significant market share gains as Baumbick is expected to play a pivotal role in the Ford restructuring plan.
In a written statement, the company announced that John Lawler, Ford’s chief financial officer, will lead Ford’s global supply chain organization until another officer is selected.
Doug Field will be the new Chief technology officer and will continue to oversee EV products, software, and digital systems development. Furthermore, he will also supervise design and vehicle hardware engineering. Lisa Drake, vice president, EV industrialization, will also look after manufacturing engineering as Ford scales to a run rate of 2 million EVs per year by the end of 2026.
The agenda behind the Ford restructuring is to let the new leadership team take the wheel when it comes to developing next-generation products.
Supply chain management vice president Jonathan Jennings will be responsible for supplier assistance and quality and report to Lawler. Hau Thai-Tang, chief industrial platform officer, will retire on October 1 after spending over 34 years with Ford, while Dave Filipe, vice president, vehicle hardware modules, will retire effective December, after 30 years of service.
Last month, the Ford job cuts affected nearly 3,000 workers as the company tries to keep costs down while focusing on EVs.
