Ford Motor more than doubled the amount of money it plans to invest on electric and autonomous vehicles, to $29 billion.
The No. 2 U.S. automaker also said the global semiconductor chip shortage could lead to a 10 percent to 20 percent loss in first-quarter production, resulting in a potential hit to operating earnings of $1 billion to $2.5 billion.
“If EVs continue to quickly gain favor, especially with commercial customers, we want to be clear that we will not cede ground to anyone,” Chief Financial Officer John Lawler told reporters on a conference call.
Ford said it was “doubling down” on connected electric vehicles and said it will invest $22 billion in electrification through 2025, nearly twice what it had previously committed to EVs. Ford also said it would invest $7 billion in self-driving, or autonomous, technology development over 10 years through 2025 – $5 billion of that from 2021 forward.
“We are accelerating all our plans,” Chief Executive Jim Farley said, including increasing battery capacity and adding more electric vehicles in its future portfolio.
He said on a conference call with analysts that the $22 billion investment does not include potential investment in battery production, whether through at Ford itself or via a joint venture. He added that Ford will have more announcements soon around its EV partnerships.
Farley told Reuters last fall Ford was considering making its own battery cells as sales volumes of electric vehicles rise globally.
Ford previously committed to invest $11.5 billion in electrification, including gasoline-electric hybrid vehicles, through 2022. That included the launch of the Mustang Mach-E EV crossover, and electric versions of the F-150 pickup and Transit van.
A Ford spokesman said the $22 billion includes hybrid vehicles, but the commitment is “overwhelmingly” on EVs.
U.S. rival General Motors has said it will spend $27 billion by 2023 on electric and autonomous vehicles, a total that does not include hybrids. It plans to offer 30 EVs globally by 2025 and is targeting topping annual sales of 1 million EVs in the United States and China by 2025.
Asked whether Ford would match GM’s announcement that it aspires to stop selling gasoline-powered light vehicles by 2035, Lawler told reporters Ford is focused on selling high-volume EVs now, a possible reference to GM’s initial EV product launches being lower-volume, higher priced models.