Ford Motor Company will increase its planned investment in electric vehicles from $4.5bn to $11bn by 2022 and hopes to have 40 hybrid and fully electric vehicles on sale. Ford executive have announced this includes the costs of developing dedicated electric vehicle architectures.
Fords R&D costs for 2016 were $7.3bn which was an increase from 2015 where costs sat at $6.7bn.
Investors were told that over the next 5 years costs would be reduced by $14bn and there would be a shift in capital investment which moved Ford away from sedans and internal combustion engines and towards the development of trucks and hybrids.
Out of the 40 electrified vehicles Ford has promised for 2022 16 will be fully electric vehicles and the others will be plug-in hybrids.
Competitors such as GM, VW and Toyota have already made it very clear they plan to expand their presence in the electric vehicle market very well known.
The cause for this reaction from huge OEM’s is partly from the pressure of regulators in Europe, China and California to cut carbon emissions from fossil fuels, and also the pressure from Tesla’s success in the market from electrical vehicles.
Fords move to the electric vehicle market has been bounced around for the last 6 months after the former CEO Mark Fields was replaced by Jim Hackett. Ford disclosed they had formed a team to speed up global development of electric vehicles.
Some of the electric vehicles will be produced with Fords joint venture in China, which will be aimed at the Chinese market.