Speaker 1: As we've been reporting today, Ford is said to be
Speaker 1: preparing to cut as many as eight thousand jobs in
Speaker 1: the coming weeks. We told the automakers trying to boost
Speaker 1: profits to fund its investments in electric vehicles. Joining us
Speaker 1: now with more is Keith Norton. He's Bloomberg Auto reported
Speaker 1: in Detroit. So, Keith, where is the acts going to
Speaker 1: fall for Ford? Well, it will be broadly with salaried workers,
Speaker 1: not the factory workers, but the white color folks, and
Speaker 1: much of it will come from this new division that
Speaker 1: Ford created called Ford Blue, which is their internal combustion
Speaker 1: engine vehicles, the traditional gas burners. UM CEO Jim Farley
Speaker 1: wants to lower costs by three billion, and he wants
Speaker 1: his traditional vehicles to make more money so they can
Speaker 1: fund their very large electric vehicle ambitions. So, Keith, if
Speaker 1: you look at eight thousand jobs, do we know how
Speaker 1: that may translate into a dollar amount of me what
Speaker 1: would the cost savings be on a job reduction of
Speaker 1: that magnitude? You know, it'll be a big chunk of
Speaker 1: that three billion that they're going after for sure. That
Speaker 1: is the quickest way to you know, hit a cost
Speaker 1: target that large is to eliminate people and just you know,
Speaker 1: to put it in context, Ford has US salary workers.
Speaker 1: It has over salary workers in North America. This is
Speaker 1: where most of these cuts will be coming. That's a
Speaker 1: big chunk of the salary workforce. So has for progressing
Speaker 1: in this pivot from internal combustion engines to electric vehicles.
Speaker 1: So far, its first couple of models have been very promising.
Speaker 1: The first one that came out last year was the
Speaker 1: electric Mustang Mache, which is kind of a crossover sport
Speaker 1: utility vehicle that has sold very well. UM. It put
Speaker 1: forward second a distant second behind Tesla in the United
Speaker 1: States last year, where they remain through the first half
Speaker 1: of this year. UM. And then the second big e
Speaker 1: V they have is uh F one fifty lightning pickup truck,
Speaker 1: which just debuted in May. They had two hundred thousand
Speaker 1: pre reservations for that. UM they have very high demand.
Speaker 1: Their their EV sales were up year over year in
Speaker 1: June by seventy six percent. Admittedly, ak lood base, you know,
Speaker 1: it's it's a different UM magnitude altogether than where test
Speaker 1: was at right now. But Jim Farley, the CEO, says
Speaker 1: he wants to catch them and surpass them. Yeah. When
Speaker 1: I think of Ford Trucks, I think the commercial division two.
Speaker 1: I mean, that's a pretty big part of their business.
Speaker 1: Do you think can we see a path for Ford
Speaker 1: to kind of move into e V trucks in the
Speaker 1: near term, so it's not just focused on kind of
Speaker 1: the consumer. Absolutely, that's a big part of their strategy
Speaker 1: because Ford is a leader in commercial vehicles far and away,
Speaker 1: leader in things like pickup trucks and vans, and that's
Speaker 1: its third electric vehicle. It's transit van also now comes
Speaker 1: in an electrified version. The ideas they're electrifying the vehicles
Speaker 1: are already strong sellers for them and um and they
Speaker 1: feel that gives them a built in market as they
Speaker 1: roll them out. We have from a tast a little
Speaker 1: earlier today, and one of the points that was made
Speaker 1: on that coal was that it's done okay navigating round
Speaker 1: supply chain difficulties. Has Ford been coping with the supply
Speaker 1: chain issues? You know, it has waxed and wayne for them.
Speaker 1: They were hit very hard last year and then the
Speaker 1: first quarter of this year, particularly in their cash cow,
Speaker 1: the F series pickup truck, which makes them most of
Speaker 1: their money. But then they did better in the second quarter.
Speaker 1: In the United States. They actually had a small one
Speaker 1: point eight percent sales improvement in the second quarter and
Speaker 1: a very strong June. So um, they seem to be
Speaker 1: improving the situation, but like the rest of the industry,
Speaker 1: they won't be out of this supply shortage for a
Speaker 1: long time to come. Yeah, and that's really been showing
Speaker 1: up mostly on the semiconductor side, but I'm curious on
Speaker 1: the battery side. Is Forward partnering with anyone to make
Speaker 1: lithium batteries that would be used in these evs? Yeah,
Speaker 1: so they are. They have a partnership with sk Innovation
Speaker 1: of South Korea. They're building three battery plants in Tennessee
Speaker 1: and Kentucky and the new Electric Vehicle fuck factory in Tennessee,
Speaker 1: and that's an eleven point four billion dollar project, those
Speaker 1: four factories. So that that's the way they've been doing it.
Speaker 1: Bloom Bigger is also reported that they might begin receiving
Speaker 1: batteries from atl the Chinese battery suppliers, So that's a
Speaker 1: that's a big part of the e V emerging e
Speaker 1: V races who can lay their hands on the most
Speaker 1: battery supply, So how's the outlook looking for forward for
Speaker 1: the second half? You know, pretty good. As I said,
Speaker 1: the chip supply situation is improving. They still have very
Speaker 1: strong selling traditional U internal combustion engine vehicles like the
Speaker 1: Bronco SUV UH and they have waiting lists for those
Speaker 1: models so um and they have focused to their efforts
Speaker 1: on the higher profit vehicles SUVs and trucks, and that
Speaker 1: is turning out to be a good strategy for them.
Speaker 1: What do we know about the way that Ford thinks
Speaker 1: about incentive programs that may be sponsored by the government,
Speaker 1: is that does that get baked into their projections? I mean,
Speaker 1: are they looking at what Washington is doing to try
Speaker 1: to encourage the adoption of more electric vehicles? For sure?
Speaker 1: And they definitely support things like the tax credit that
Speaker 1: you get pro buying an e V so so absolutely
Speaker 1: they support that. They feel the government has to play
Speaker 1: a role in trying to nurture the market and also
Speaker 1: in trying to establish a charging infrastructure in this country.
Speaker 1: You know, if you look at a five year chat
Speaker 1: of folds US, it's going sideways or really it's up
Speaker 1: eight percent in the past five years. I mean, what
Speaker 1: needs to happen to break it out of this trading
Speaker 1: range is e vs. The onst to this. Yeah, if
Speaker 1: you look at a more narrow range. Since Jim Farley
Speaker 1: became CEO in October of the stock has has been
Speaker 1: up that more than doubled last year. It was the
Speaker 1: biggest gainer among all automakers last year. This year it
Speaker 1: has been down you know, almost um as, which is
Speaker 1: more than the s course, but it's also part of
Speaker 1: the whole sector being down, including players like Tesla, because
Speaker 1: of concerns over inflation and the supply snarls that have really,
Speaker 1: um you know, bedeviled the industry. So it kind of
Speaker 1: waxes in Waynes. It certainly is down at the moment.
Speaker 1: Keith cud stuff, thank you so much for being with us.
Speaker 1: Keith not in Bloomberg Auto reporter in Detroit talking about
Speaker 1: the news has broke today. Ford Motor preparing to cut
Speaker 1: as many as eight thousand jobs in the coming week.
Speaker 1: They're trying to raise some money, uh well, to basically
Speaker 1: fund their investment in the electric vehicles