Ford Motor Co. is moving planned production of an electric crossover with a 300-mile range to Mexico from Michigan to make way for additional investment on autonomous vehicles in its home state.
Ford still plans to begin to build the battery-electric crossover in summer 2020, but it will be assembled at its plant in Cuautitlan instead of Flat Rock, Michigan, according to an internal memo obtained by Automotive News.
“This allows us to bring this exciting new vehicle to global customers in a more effective way to support our overreaching business goals,” Ford said in the memo.
The move comes as Ford and other automakers place increasingly large bets on electrification and self-driving technology. New CEO Jim Hackett is attempting to balance Ford’s competitiveness with other automakers and Silicon Valley tech companies while controlling costs and improving what he calls the company’s “fitness.”
Ford believes this move allows it to do both, by transforming Flat Rock into an “AV center of excellence” while moving an expected low-margin electric vehicle to a country with lower labor costs.
Battery-electric crossover will be made in Flat Rock alongside an autonomous car due out in 2021
Ford originally said the battery-electric crossover will be made in Flat Rock alongside an autonomous car due out in 2021. The vehicles were announced earlier this year as part of a $700 million investment that would bring the plant 700 jobs.
Ford now plans to devote more volume to its autonomous vehicle development. With the move, confirmed Wednesday by Ford, Ford said it will invest an additional $200 million and add another 150 jobs.
“We see a bigger opportunity now than we originally saw,” spokesman Alan Hall told Automotive News.
Ford also said Wednesday the autonomous vehicle will be a commercial-grade hybrid with an all-new nameplate.
It had previously been mum on details about the vehicle, only saying it would not be a Fusion sedan, which Ford has been testing the technology on.
Ford believes it can launch its autonomous vehicle at-scale in 2021, Hall said. It plans to use the self-driving vehicle for commercial purposes like ride-hailing and package delivery, and it’s designing the vehicle for those specific purposes.
Hackett previously said the automaker would begin testing out the technology and business case in a yet-to-be-named city next year.
The automaker is battling the perception that it’s lagging behind crosstown rival General Motors, which recently announced plans to deploy autonomous vehicles in 2019, two years ahead of Ford.
Focusing on autonomous vehicles in Flat Rock also allows Ford to build its long-range electric crossover in a low-cost country.
Despite government mandates, the public has largely shunned EVs and automakers have yet to turn a profit building them.
Said Hall: “It’s a business decision that allows us to be more fit as a company.”
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