Ford Motor outlined plans to boost spending on its electrification efforts by more than a third and said it aims to have 40 percent of its global volume be all electric by 2030.
Under a plan dubbed “Ford+” meant to have investors value it more like a technology company, the No. 2 U.S. automaker said it now expects to spend more than $30 billion on electrification, including battery development, by 2030, up from its prior target of $22 billion.
“This is our biggest opportunity for growth and value creation since Henry Ford started to scale the Model T,” Ford Chief Executive Jim Farley said at the company’s Capital Markets Day meeting online. “Our ambition is to lead the electric revolution.”
Ford and other global automakers are racing to shift their gasoline-powered lineups to all electric power under pressure from regions like Europe and China to cut vehicle emissions. U.S. President Joe Biden has called for $174 billion to boost U.S. EV production, sales and infrastructure.
Ford’s 2030 sales target would translate to more than 1.5 million EVs, based on last year’s sales. By comparison, rival General Motors Co (GM.N) has targeted annual sales of more than 1 million EVs in the United States and China by 2025.
GM aspires to halt U.S. sales of gasoline-powered passenger vehicles by 2035, and has said it was investing $27 billion in electric and autonomous vehicles over the next five years.
Some analysts see Ford as trailing rivals in the electrification race, but Ford officials disagree, pointing to the rollout of the Mustang Mach-E electric crossover, and the electric versions of the Transit van and F-150 pickup.
Ford said it expects to deliver an 8 percent operating margin in 2023.
The Dearborn, Michigan-based company also said it is forming a new stand-alone unit, called Ford Pro, to focus exclusively on commercial and government customers, a segment Farley sees as a huge growth opportunity for the company.
The company is targeting increasing revenue for the commercial market for hardware and related services addressable by Ford Pro to $45 billion by 2025, up from $27 billion in 2019.
Ford said it will also aim to develop EV batteries under the “IonBoost” brand, from lithium-ion versions to lithium-ion phosphate for commercial vehicles and eventually low-cost solid-state batteries in partnership with startup Solid Power, in which the automaker has invested. Farley expects Ford to cut battery costs by 40 percent by mid-decade.