Ford's plan to take on Tesla involves letting customers order EVs online 'in their bunny slippers'

·2 min read
Ford CEO Jim Farley speaks about the company's plan to split up its EV and gas-powered vehicle divisions
Ford CEO Jim Farley speaks about the company's plan to split up its EV and gas-powered vehicle divisions.Photo provided by Ford Motor Co.
  • Ford hopes that letting customers order EVs online would help the firm compete with its rivals.

  • Its CEO, who wants Ford to build more than 2 million EVs a year by 2026, told analysts of the plans.

  • Unlike like Tesla, Ford sells its cars through a network of franchisees.

Ford CEO Jim Farley hopes that e-commerce will help the auto giant gain ground on its rivals in the race to dominate the US electric vehicle (EV) market.

In an investor call discussing the firm's second-quarter results on Wednesday, Farley said Ford plans to allow customers to either order electric models online or order them directly from a dealership.

In regards to an e-commerce platform, Farley stressed the need for customers to "have a very predictable experience, whether they're in a dealership or in their bunny slippers, and they'll have a very simple, transparent, very easy purchase process."

The company is in the midst of a transition to build more than two million EVs a year by 2026. This includes the F-150 Lightning electric pickup truck.

Ford has restructured its business into two separate divisions, focusing independently on gas-powered vehicles and electric cars. There have been reports that it could cut jobs as a way of funding the EV expansion.

However, analysts have questioned Ford's ambitions, on the basis that supply chain pressures, raw material costs, and other legacy issues could make them unrealistic, per CNBC.

Unlike like Tesla, which owns an in-house network of sales and servicing centers, Ford sells its cars through a network of franchisees. Farley said the model puts Ford at an estimated $2,000 disadvantage per vehicle,  compared with its "pure-play" competitors.

Ford and Farley did not immediately respond to Insider's request for comment made outside of normal working hours.

Dealers would be responsible for the delivery and serving of the vehicle but customers would be able to order them online, per CNBC. An advantage for dealers would be having to keep a lower stock of vehicles on site. The change could shave as much as $1,300 off the $2,000 per-vehicle cost disadvantage, Farley predicted, per CNBC.

Farley is also learning other lessons from Tesla. Instead of remodeling cars every few years, the firm will rely on software to keep its cars up to date.

"We have an opportunity as we go digital with these EVs to simplify our body engineering and put the engineer where customers really care," Farley said on the call.

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