Ford Announces $4.5 Billion Electrification Initiative

The Ford Motor Company is about to embrace electric vehicles in a big way. On Thursday, the automaker announced plans to invest $4.5 billion over the next five years to bring 13 new or updated EV nameplates to the market. By 2020, at least 40 percent of Ford’s nameplates will have an electrification option.

The announcement comes as fuel prices are among the lowest we have seen this century. Indeed, a gallon of regular fuel will cost you less than $2 in most states, approaching levels last seen in 2009. Nevertheless, the long-term trend for fuel prices has it rising gradually over the next five years, with some analysts forecasting $5 per gallon gasoline come 2020. At that price, interest in EVs may intensify, particularly for standard (HEV) and plug-in hybrid electric vehicles (PHEVs).

2017 Ford Fusion Energi.
2017 Ford Fusion Energi.

New Battery Electric Ford Focus

Speaking at a press event, Raj Nair, executive vice president, Product Development explained that Ford’s investment will include a $2.1 million contribution for a battery lab at the University of Michigan in a bid to advance research and development. Moreover, the automaker plans to roll out the first of its 13 new or updated products next year, when the battery electric Ford Focus hits the market.

Ford says the next-generation BEV Focus will have a range of approximately 100 miles and offer DC fast-charge capability, enabling it to be recharged to 80 percent of its capacity in about 30 minutes.

However, most of the vehicles included in the initiative will be HEVs and PHEVs, a more sensible decision given the range anxiety inherent in pure electric vehicles. Typically, electric vehicles have a 100-mile average range, but weather and travel conditions can significantly reduce that number according to a 2014 AAA study. Although most consumer trips fall within those limits, an electric vehicle is simply too restrictive for most vehicle owners.

A Truly Global Initiative

Ford’s initiative is global too, as the company will allocate a portion of those funds to battery development in a bid to expand into Asia and Europe. The automaker has targeted China, Korea, and Taiwan as its prime markets for growth.

The automaker isn’t looking solely at electric vehicles as it plans for its growth. Ford also has autonomous vehicles in mind, part of its Ford Smart Mobility plan whereby it will also field a host of products.

“As both an auto and a mobility company, we at Ford are going further than just designing the product to move people from point A to point B,” said Raj Nair, executive vice president, Product Development. “We are considering the way customers interact with our vehicles as a unified experience, looking for ways to excite and delight customers and make their lives better.”

Competing Manufacturers and Vehicle Electrification

Ford, of course, is not the only major manufacturer investing billions of dollars in vehicle electrification. Toyota, a pioneer in all things hybrid, has a new Prius to show for it and has plans to expand production of its Mirai hydrogen-powered car. GM recently released the second-generation Chevrolet Volt and will also have an all-electric Chevrolet Bolt arriving in 2017.

Other manufacturers are certain to release new or improved products over the coming years. For example, the second-generation Hyundai Sonata Hybrid is here and now includes a PHEV variant. Hyundai is also a pioneer in all things hydrogen.

Fuel Price Trends

As for the lower fuel prices, they’re putting the hurt on EV sales. Instead, consumers are buying pickup trucks and SUVs in greater numbers, vehicles that are much less efficient than gas-powered sedans, but much more profitable for manufacturers too. Likely, some of those profits will fuel EV development with automakers such as Ford hoping that a robust market awaits come 2020.

See AlsoEnergized by the 2017 Ford Fusion Energi

Author: Matthew Keegan
Matt Keegan has maintained his love for cars ever since his father taught him kicking tires can be one way to uncover a problem with a vehicle’s suspension system. He since moved on to learn a few things about coefficient of drag, G-forces, toe-heel shifting, and how to work the crazy infotainment system in some random weekly driver. Matt is a member of the Washington Automotive Press Association and is a contributor to various print and online media sources.

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