Ford is looking at ways to separate its EV business from its other operations in order to win more positive attention from investors, according to a Bloomberg report published Friday.
CEO Jim Farley wants to “wall off” the EV business from its internal-combustion engine business, and has considered spinning off one or the other, according to the report, which cited anonymous sources familiar with the matter.
Tesla has become the darling of Wall Street thanks largely to its all-electric product line, while Ford has faced pressure to spin off its EV business to boost its value by shedding the costs of the legacy internal-combustion vehicle business, the report noted.
2022 Ford F-150 Lightning Pro
On Ford’s earnings call earlier this month, Farley said that “running a successful ICE business and a successful BEV business are not the same,” Bloomberg noted. He the EV business is “fundamentally different” from Ford’s existing business, and that the automaker is “done with incremental change.”
Ford says it doesn’t plan to spin off its EV business, and doing so would be difficult, according to the report. Instead, Ford could internally separate EVs into a discrete business unit as part of a reorganization, the report suggested.
The automaker is already ramping up production of EVs under its main brand. Ford plans to triple Mustang Mach-E production by 2023, and is boosting production of the upcoming F-150 Lightning pickup truck in response to robust demand. The E-Transit van recently started production as well, and Farley has said Ford is planning a full-size electric pickup truck designed for “incredibly high volume.”
2022 Ford E-Transit
Other automakers have tried distinguishing their EVs in sub-brands. Hyundai has done so with its Ioniq 5 and a full lineup to come—but United States availability is limited partly to dealerships not yet EV-versed.
Mercedes also announced its EQ brand for EVs years ago, and indicated it would bring about all sorts of changes in the way EVs would be built, sold, and supported, but the EQS is essentially sold alongside other models.
Polestar is the closest to a full spinoff. The Volvo Cars relative is undergoing a SPAC reverse merger that will bring it more independence—and, perhaps, a market valuation that will make a Ford EV spinoff more tantalizing than ever.