Ford Motor has decided to join the line of electric vehicle production following the successes of Tesla, Volkswagen and Nissan and several others.
It plans to pour $11 billion over the next three years into the development and manufacturing of electric vehicles, according to Jim Hackett, CEO of the company.
Hackett told Phil LeBeau of CNBC in an interview prior to this week’s start of the Detroit Auto Show that Ford Motor has 16 models that are currently in design and development and plans on producing 40 hybrid and fully electric cars by 2022.
He says consumers are in for a really big surprise next year. Ford Motor is revamping a major part of their line.
“Some of the pain in the margins additionally [is] because the vehicles are old. We have on average the oldest fleet in the industry and we are going to have average the newest fleet. 75 percent of the portfolio is being turned over,” Hackett said.
Ford Motor is restructuring their fleet due to declining profits during the first nine months of 2018. Their shares are under $10 which has not seen since 2012.
Hackett who became CEO the first time in 1994 at age 39, became the youngest leader in the company’s history. He remained at the helm for 20 years and retired in 2014. He has been on the Board of Directors since 2013. However, in 2017, Hackett once again took over the reigns of the company as CEO and for the last 19 months claims to have addressed many of the “long-lived problems that haven’t been addressed…I’ve addressed every one of them,”he told LeBeau.
One of the major decisions that Ford Motor will be making will involve cutting thousands of jobs in Europe and discontinuing their lines that have not proven to be profitable. Ford hopes to reduce costs by $14 billion from 2019 through 2013 through this massive restructuring campaign.
On the other side of the world particularly in China, Hackett does not see China’s economic slowdown as a detriment to the company in the same manner that Apple does.
“China’s optimism is still high with us,” he told CNBC. “The brand is one of the highest-ranking brands in the country. Even at the highest levels of the government they see it as a family-owned business that middle America loves. The Chinese want to relate to American businesses like that,” Hackett added.