Back in March, current auto news headlines seemed all-too-eager to report Ford’s decision to invest $850M in the restructuring of their Flat Rock, MI assembly plant. Amidst the steady string of negative news stories to befall the automotive industry (especially domestic automakers) it never fails to feel refreshing when there’s something positive to report upon, and this headline was no exception; especially since there was more to the story to tell.
While some would say the industry is late to game and currently playing catch-up in terms of alternative fuels and renewable energies, there’s no escape the wide-scale focus that automakers have placed upon the continued development of hybrid, EV and hydrogen fuel cell technologies. And Ford seems keen to place themselves at the center of such developments.
As summarized in a statement by Ford’s President of Global Operations, Joe Hinrichs, “We’ve taken a fresh look at the growth rates of electrified vehicles and know we need to protect additional production capacity given our accelerated plans for fully electric vehicles.”
And speaking of innovation, we’d be remiss if we didn’t touch upon the industry’s oft-reported race towards autonomy, another area where Ford is keen to remain central to.
“As we ramp up AV production, this plan allows us to adjust our investment spending to accommodate the pace of growth of this exciting new technology,” adds Hinrichs. This new plan combines our core strength in mass manufacturing with the agility and leanness we’ve shown with our modification centers for specialty manufacturing.”
So what does this mean in terms of the big picture, and how does Ford’s recent investments factor into these specific areas of focus?
Well, first…Ford has confirmed that they’ll be investing approximated $900M in their manufacturing footprint in southeast Michigan. Focused primarily on (i) electrification of next-gen offerings and (ii) release of autonomous vehicles beginning in 2021, the investment is expected to add 900 new jobs in southeast Michigan through 2023.
And while no firm details have been released as to the specific vehicles that will be produced in Flat Rock (or in associated facilities) the news has moistened its fair share of palates. Currently, the plant remains focused on Mustang and Lincoln builds. But with the highly-publicized Mustang-inspired electric SUV being manufactured in Mexico, suspicion of what vehicle(s) will be produced at the overhauled facilities shifts to the (equally highly-publicized) all-electric F-Series pickup truck. Aside from that possibility, it’s really anyone’s guess at this point.
But whichever models end up the focus of the investment is largely irrelevant. As summarized so efficiently by Hinrichs, “This is good news for the future of southeast Michigan, delivering more good-paying manufacturing jobs.” And in light of the bad press surrounding plant closures, like those announced by GM in recent months, we’d be hard-pressed to disagree.
And yet it poses some interesting questions in terms of electrification strategies in general. In terms of Ford, specifically, we know that their strategy is likely to be anchored by their ill-defined global alliance with Volkswagen. VW, who recently committed to adding 1,000 jobs of their own through the refitting of their Chattanooga, TN plant as the North American base for manufacturing on their new MEB electric platform.
But the truth is that Ford has been lagging behind competitors in regard to the building of battery EV’s. Acknowledging that, and the advantage to be gained by aligning themselves with VW, Ford still has their work cut out for them. To quote Ford CEO Jim Hackett, “We still have to prove to the world that they’ll shift to these vehicles”. And with upstart competitors like Tesla so far ahead in terms of EV innovation, it would be unfair to describe Ford’s plan as anything else but ambitious. But is it reasonable to think that Ford can rebrand themselves as a leader in sustainability? And even though the OEM is normally allocated to systems integration (rather than conceptualization) when it comes to autonomous technology, isn’t is just as questionable whether or not Ford could rebrand themselves as a leader in innovation?
Now, to be clear, we’re not trying to malign Ford’s ambitious grab for continued relevance. The fact that they’re creating American jobs rather than continuing to outsource work is deserving of a celebration in itself. If nothing else, it will prove interesting to watch the automotive landscape evolve in the years to come. With nearly every automaker making a play for autonomy, and most hedging their bets between EV and Hydrogen Fuel Cell technologies, it goes without saying that things are bound to be very different a decade from now.
