Ford Motor Company is the latest major automaker to promise an all-electric future, announcing plans for all vehicles the company sells in its European market will only be electric vehicles (EVs) by 2030, according to a recent press release.
Ford is dropping a billion dollars on electrification
The all-electric commitment will follow a phased-in approach starting with the company’s first European-built, electric passenger vehicle for European customers launching in 2023. In addition, by mid-2026, Ford says 100 percent of its passenger vehicle range in Europe will be zero-emissions capable, all-electric or plug-in hybrid, before finally going full-electric in 2030. Ford’s commercial vehicles will also be zero-emissions capable by 2024.
Along with these commitments comes substantial investment. Ford says it plans to inject $1 billion into its Cologne assembly plant, transforming it into what the company is calling the “Ford Cologne Electrification Center.” Already one of Ford’s largest manufacturing facilities on the continent - and home to Ford’s European headquarters - the revamped facility will be dedicated to making EVs in the future, including Ford’s aforementioned Euro-market EV in 2023.
This news is in addition to a previous announcement in early February that globally, Ford would double its investment in EVs to $22 billion while allocating a further $7 billion for autonomous vehicles. This approximates to a similar financial commitment to electrification made by General Motors to invest $27 billion in launching 30 various models of EVs by the end of 2025. And in a sign that the industry itself is rapidly going electric, Jaguar Land Rover also announced last week it will be all-electric by 2030, too.
A changing regulatory landscape
In each case, these manufacturers are, to a large extent, responding to tightening emissions legislation in their most important markets. European rules require that by 2030 cars sold there will have to achieve a 37.5 percent reduction in CO2 emissions compared with 2021 levels. Meanwhile, the United Kingdom plans a ban on fossil-fuel vehicles by 2030.
Automotive News Europe reported last year that these stringent EU rules mean all automakers have turned to electrification to some degree to achieve the forthcoming standards and is no doubt behind the EV directives at Ford and Jaguar Land Rover.
Not so much for General Motors, though. GM essentially pulled out of the European market in 2017 with the sale of its European marques, Vauxhall and Opel, to France’s PSA Group. But GM faces similar pressure elsewhere.
GM’s largest worldwide market is China, where sales of EVs are burgeoning. Furthermore, as Forbes reports, China will likely impose a complete ban on combustion engines by 2040, making GM’s commitment to an all-electric future by 2035 well-timed.
Compliance being king, then, illustrates why Ford’s EU strategy makes sense. But despite the company’s investments, the automaker is not charting entirely its own course. A little over 18 months ago, Ford announced that it would work with Volkswagen on both autonomous and electric vehicles development.
A partnership with Volkswagen
Indeed, Ford said back in that 2019 announcement that the company “will use Volkswagen’s electric vehicle architecture and Modular Electric Toolkit (MEB) to design and build at least one high-volume fully electric vehicle in Europe for European customers starting in 2023, more efficiently advancing its promise to deliver expressive passenger cars while taking advantage of Volkswagen’s scale.”
We can expect, therefore, the new EV from Ford’s Cologne facility in 2023 to be the fruit of this collaboration, but details of how the car will be configured remains to be seen.
We do know what MEB vehicles from VW look like, though, because that automaker has begun releasing its so-called “ID” family of vehicles already. The modular approach, which looks conceptually similar to GM’s Ultium platform, can support a range of iterations and classes of vehicle, so Ford would appear to have some latitude as to what market to aim for.
Until then, Ford’s only current pure-EV you can buy today is embodied in the Mustang Mach-E. Ironically, though Ford’s bold commitment to EVs is Eurocentric, in 2020 Ford offered no electric vehicles for sale in the EU, while conversely, Americans were able to buy the Mach-E from last December.
Will the EV advantage shift from Ford North America to Ford Europe as we move into the future? The answer to that likely depends on how Ford allocates the rest of that $22 billion electrification budget, which in turn will no doubt need to respond to prevailing regulations.
Phil Covington holds an MBA in Sustainable Management from Presidio Graduate School. In the past, he spent 16 years in the freight transportation and logistics industry. Today, Phil's writing focuses on transportation, forestry, technology and matters of sustainability in business.