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DETROIT – Ford Motor said Wednesday it will reorganize operations to separate its electric and internal-combustion engine businesses into separate units within the automaker.
The company expects the move will streamline its growing electric vehicle business and maximize profits.. It’s a similar strategy to how Ford is operating its Ford Pro commercial vehicle business under CEO Jim Farley’s “Ford+” turnaround plan.
“We’re going all in,” Farley said in a Wednesday morning statement announcing the reorganization.
Separating the operations but keeping them in-house goes halfway to appeasing some Wall Street analysts who have been pressuring legacy automakers such as Ford to spin off their electric vehicle operations to capture value that investors have been awarding some EV start-ups.
Shares of Ford were up by more than 4% during pre-market trading. The stock closed Tuesday at $16.70 a share, down by 4.9%
The EV business will be called “Ford Model e.” The traditional operations will be “Ford Blue.” Ford said they will “operate as distinct businesses but share relevant technology and best practices to leverage scale and drive operating improvements.”
The company plans to breakout financial results for the new units as well as its Ford+ business by 2023, giving investors greater transparency into the operations.
“We are going all in, creating separate but complementary businesses that give us start-up speed and unbridled innovation in Ford Model E together with Ford Blue’s industrial know-how, volume and iconic brands like Bronco, that start-ups can only dream about,” Farley said.
The move follows Bloomberg News first reporting that Farley was evaluating whether to separate its EV and traditional business, including a potential spinoff. Farley last week said Ford had no plans to spin off either of the operations.
This is breaking news. Check back for updates.