🥂 try 50% off your first 6 bottles!
🚗 ford’s going electric
layoffs are very common in tech these days, but here’s news from F 0.00: last month, the company announced plans to cut as many as 8k jobs "in weeks' time", and it started today
management confirmed Monday that it'll lay off ~3k white-collar and contract employees
yes, that is only 1% of the company’s entire workforce, but the significance comes from where 2/3 of the job cuts are being made – the dearborn, michigan headquarter
so, why now? the reason’s a lil’ different from recent tech layoffs
ford isn’t going through a coinbase-like monumental drop in revenues nor earnings
it’s rather the start of a series of changes, as ford shifts more resources and operational strategies towards electric vehicle production
how serious are they? very, and they really have no choice
ceo jim farley earlier this year reorganized the company's operations into two separate divisions – conventional gas engine business and ev/software business
ford’ looking at 600k ev's produced annually by late 2023 and 2m+ by end of 2026 – that's claiming an annual growth rate (in production) of 90%+, more than double the forecasted rate for the industry as a whole
ford has no choice because: in 2021, for plug-in vehicles (electric & hybrid)
TSLA 0.00 had 14% share of the market, coming in #1 at 936k vehicles
and the rest of top 5 being volkswagen, saic, byd, and stellantis
these five clocked in 3.3m+ (51% market share)
imo:
it’s very likely tesla’s market share of the total ev market will continue to sideline or decline as incumbents with much larger infrastructure pour resource and time into the space
for ford though, there’s no clear evidence that it’s got new models on the way that’s a clear differentiator in terms of technology or traction among its already-prevalent competitors in the space
but i wouldn’t stop at a hard no – ford, unlike tesla and like many other incumbents, has a strong established brand and b2b pipeline that's been established over generations of the company’s survival (not to mention multiple brands ford owns)
if i were to bank on ford in the ev space, a strong, unique software play would be interesting – that, we’ll have to see…
hope today’s letter was interesting. i’ve been trying not to focus on one company, but i may be totally wrong on that. if this is refreshing and you’d like to see more content like this, shoot me an email (apeofomaha@substack.com )!
💡 something im thinking about
as always, i am no financial advisor! (i am no substitute for professional financial services)
enjoyed this newsletter?