Ford Road (F) For stock market success and future popularity depends on a big gamble in the form of a giant factory near Memphis Tennessee.
The blue oval brand has set itself the ambition of producing two million electric vehicles globally annually by the end of 2026. In 2021, the group manufactured just 27,140 electric vehicles in the United States. This means that getting to two million units after five years is a huge challenge even when your name is Ford, the company that has been producing and selling cars around the world for decades.
CEO Jim Farley is determined to achieve this ultra-ambitious goal. He promised that Ford would spend $50 billion developing electric vehicles, which is expected to account for more than half of its sales by 2030.
The first and most important step in this challenge is to build a gigantic production site that will house a new vehicle manufacturing plant and a battery development plant that powers it in Tennessee.
The first all-new assembly plant since 1969
This is the site that Ford BlueOval City names on the Gigafactory image of its great competitor Tesla (TSLA) It has approximately 6 square miles of campus.
Ford says it will create nearly 6,000 new jobs. The car manufacturer will mainly manufacture electric trucks there and develop batteries, with its South Korean partner SK, which will also be for cars from its luxury brand Lincoln.
The company, which presents itself as America’s No. 2 electric vehicle brand, said production of the cars is expected to begin in 2025.
The cost of establishing this production site, which is supposed to bring the automobile group closer to its goal of 2 million vehicles per year by 2026, is estimated at $5.6 billion.
Ford announced on September 23 that it had begun building the site, less than a year after revealing the investments. The company added that its crews have already moved more than 4.6 million cubic yards of soil, enough to fill nearly 34,500 backyard pools.
Nearly 370,000 tons of stones were laid, which is the weight of more than 1,600 Statues of Liberty. More than 4,600 deep foundations have been installed, with a total height of nearly 176 Eiffel Towers, according to Ford.
“We’re building the future here in West Tennessee,” said Eric Grob, Ford’s director of building the new footprint. “This facility is a blueprint for Ford’s future manufacturing facilities and will enable Ford to help lead America’s transition to electric vehicles.”
BlueOval City is the company’s first all-new assembly plant since 1969.
Ford is on the rise
In 2021, General Motors (GM) Just under 25,000 electric vehicles were sold in the United States, but that number could have been higher if the group run by CEO Mary Barra had not had to suspend production of the Chevy Bolt due to a battery issue.
But it’s not certain GM will pass Ford in 2022. The commercial success of the F-150 Lightning truck, the electric version of the F-150’s best-selling truck, since May will undoubtedly increase the company’s advantage in Dearborn, Michigan.
Tesla, which does not disclose its sales figures in the United States, was in the lead with a market share of 72% of 487,560 electric vehicles sold, according to official figures.
The early start of construction at the Tennessee production complex reflects Ford’s urgency to meet the growing demand for electric vehicles. The automaker wants to be able to weed out anything that might slow those efforts.
On September 22, the company reorganized leadership to better control the supply chain while parts shortages and rising raw material prices remain a major problem.
Thus, the company temporarily expanded the duties of Chief Financial Officer John Lawler. In addition to his current role, Lawler will now lead Ford’s global supply chain.
“Ford is transforming its global supply chain management capability to support efficient and reliable sourcing of components, in-house development of key technologies and capabilities, and world-class cost and quality implementation,” the company said in a press release.