People attend the all-electric SUV of the Ford Mustang Mach-E at the 2019 Los Angeles Auto Show in Los Angeles, United States, November 22, 2019.
Xinhua via Getty Images
DETROIT – Ford Motor said Wednesday it would reorganize operations to split its electric and internal combustion engine business into separate units within the automaker.
The company expects the move to streamline its growing electric vehicle business and maximize profits. This is a similar strategy to the way Ford manages its Ford Pro commercial vehicle business under CEO Jim Farley’s plan to overcome Ford +.
“We’re moving all in,” Farley said in a statement Wednesday morning announcing the reorganization.
Separating operations, but keeping them inside, is half as reassuring as some Wall Street analysts are pressuring legacy carmakers such as Ford to separate their electric vehicle operations to capture the value investors are giving to some start-up electric vehicles.
Shares of Ford rose more than 4% during pre-market trading. Shares closed at $ 16.70 a share on Tuesday, down 4.9%
The EV business will be called the Ford Model e. The traditional operations will be Ford Blue. Ford said it would “operate as separate businesses, but share appropriate technologies and best practices to scale up and drive operational improvements.”
The company plans to break the financial results for the new units, as well as for its business with Ford + by 2023, giving investors more transparency in operations.
“We’re entering everything, creating separate but complementary businesses that give us start-up speed and unbridled innovation in the Ford Model E, along with Ford Blue’s industrial know-how, volume and iconic brands like Bronco that startups can only dream of Said Farley.
The move follows the first Bloomberg News report that Farley is considering whether to split its EV and traditional business, including a potential separate product. Farley said last week that Ford had no plans to suspend any of the operations.
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