Jim Farley talks about his future goals on the occasion of his 5th anniversary as Ford CEO
Farley marked his fifth year as Ford’s CEO in October and outlined his future goals for the automaker. Industry insiders have praised his achievements thus far.
- In a recent podcast, Ford CEO Jim Farley talked about a variety of topics, from his personal life to the new WHQ and what’s next for himself and the automaker.
- He said he was humbled to learn that the Tesla Model 3 has less wiring and weight than Ford’s Mustang Mach-E.
- He said automakers are in the fight of their lives when it comes to making EVs that buyers can afford.
Ford Motor Company CEO Jim Farley has no intention of slowing down. He has a lot of work to do over the next two years, including delivering self-driving technology, continuing Ford’s transformation to improve quality, making electric vehicles more profitable, creating profitable adjacencies, and finally competing with Chinese automakers to sell electric vehicles.
“If Ford is going to be successful, we can’t walk away from EVs. If we want to be a global company, we’re not going to give it to a Chinese company,” Farley said. “I want to restore Ford’s dignity globally. I want Ford to be the most respected industrial company in this country.”
Farley made the comments on the podcast “Office Hours: Business Edition,” hosted by Monica Langley, which was recorded in Dearborn, Michigan in late October and broadcast live on November 12.
The podcast lasted about an hour, and Farley touched on a wide range of topics, including why he took the CEO job, why he was “shocked” by Tesla cars, when Ford will offer true self-driving technology, the status of Ford’s EV transition, and finally, how long Farley, 63, plans to lead the company.
“You walk into that office every day and you never know what’s going to happen,” Farley said. “I know specifically what I want to do. But there’s always a surprise around the corner. But I’m very connected to the mission of keeping this American icon relevant through this transition.”
He said his job leading 180,000 employees at Ford, a $200 billion publicly traded company, is about more than just cars.
“This is the best product and always will be,” Farley said. “But in your job as a CEO, you won’t succeed if you only focus on the best vehicles. It’s not that simple.”
He said Ford needs competitive costs, competitive quality, and superior people and technology.
“We’re going to have adjacent businesses, like today’s financial businesses and software businesses. There’s going to be new adjacencies,” Farley said. “Who knows… In the future, we’re going to be building large-scale robots that work inside your home. In my line of work, I don’t think we can afford to just focus on the physical four walls of a product.”
Farley had another job offer to consider.
Mr. Farley became CEO in October 2020. It was a job his grandfather nurtured him with from an early age. But it was at Phil Hill’s restoration shop in Santa Monica, California, that he honed his car skills. He started working there as a janitor and worked his way up to working on car interiors to pay for college.
“I remember the bodyman saying, ‘Farley, come over here and tell me if this panel is straight.'” So I went to put a few fingers there (to assess the position of the panel in relation to the rest of the body) and he looked at me and said, “Is that how you hold your girlfriend?” I said, “Okay.” I used my whole hand. He said, “Maybe you can get more information there?” I said, “Yes, this is not flat.” ”
Farley said this was one of the most important jobs he ever had because they taught him the beauty of cars.
Because of his love of cars and his family’s expectations, Mr. Farley feels pressure to maintain Ford’s 122-year heritage while making it profitable and innovative.
“That’s why I took the job. I had other offers to take other jobs, but I won’t talk about them,” Farley said, adding that he told his wife he wanted to lead Ford because it was facing “big problems.”
“These are going to be important issues to a lot of people, and I want to help the company be the best it can be,” Farley said. “Ford should be the best. I’m an American kid. My grandfather worked here. My mother was able to go to college because of my grandfather’s work at Ford.”
His maternal grandfather, Emmett Tracy, appeared several times in conversation. Although Tracy passed away before Farley became CEO of Ford, Farley considers him his greatest mentor. Tracy is Ford’s 389th employee, and Farley keeps a photo of his grandfather as a young man on his desk.
“You’ll know when it’s over.”
Farley said he is passionate about the job but knows he has limited time in the role.
“I think the next CEO is going to be a very different complexion than I am. I think each era requires a certain type of leader, and I think the board recognized that we were in this period, and when I’m done, everyone will know,” Farley said. “We understand that this is considered one of the most critical times in our 122-year history, perhaps one of the most troubling.”
This is very important as it relates to Ford’s efforts to lead the industry with this year’s recalls to improve quality and find ways to sell EVs profitably.
Asked how much longer he thought he could stay in the job, Farley said it only takes “a split second” to know if it’s time to quit. He mentioned an interview with retired racing driver and three-time Indianapolis 500 champion Johnny Rutherford.
“We’re performance-oriented, we’re competitive, and we all recognize that we don’t want to be a leader when we’re not the right person to lead,” Farley said. “Johnny said that six months before he retired, he knew his racing career was over because he went into the garage and didn’t sweat the small details that he had gotten in the previous race.”He said, “When I stopped sweating the small details, I knew I wasn’t going to be the best in the world.” ”
Farley said the details are “completely” still in his head, especially given that Ford and most auto companies are in the midst of a “geopolitical tariff war with China” and there is a shortage of skilled trade talent to fill service departments at factories and dealerships.
“I feel like I have the right skills and I’m getting better every year,” Farley said. Langley asked if he was going to stay for a while then.
“Absolutely, never,” Farley said. “But that’s a decision of the board and Bill Ford (executive chairman).”
Ford “went up the hill”
Despite a $700 million tariff bill and production disruptions due to a fire at a supplier, Ford reported strong third-quarter results with record profits on steady sales of gasoline vehicles and increased sales of commercial vehicles and products.
This is also a critical time for Ford as it moves salaried employees to a new global headquarters building in Dearborn that is designed to foster collaboration and improve efficiency.
“I feel like we just climbed the hill. Not because we had a good quarter, but as a leader, you have to have a sixth sense of when you’re going to reach critical mass on your team and how your team is going to work together,” Farley said. “We are well along in executing our plans and feel more excited than we were yesterday.”
Shock from Tesla
But Ford continues to lose money on EVs. Last year, Ford lost $5 billion on EV sales. By the third quarter of this year, Ford had lost $3.6 billion on them. Farley is determined to provide Americans with the EVs they want and can afford.
“When I took apart my first (Tesla) Model 3 and started taking apart Chinese cars, I was very humbled,” Farley said. “When we took them apart, what we discovered was shocking.”
He said Ford’s all-electric Mustang Mach-E has 1.6 kilometers more electrical wiring than Tesla, which adds an additional 70 pounds of unnecessary weight to the Mach-E. More weight requires more expensive and larger batteries.
A few years ago, Mr. Farley decided to create a new division within the company specifically for EVs, called Model E, to address specific issues such as the Mach-E’s wiring, and because Ford “needed a new way to manage that part of the business because it’s a software-defined vehicle,” he said.
They also wanted to make these losses public to force Ford to fix the problem sooner if investors saw it.
Ford will give you back 20 minutes of your life
Farley said that nearly half a century ago, his grandfather, Tracy, told him about his first major self-driving invention: the automatic elevator.
“He said, ‘Jim, automation is scary,'” Farley said. “I think about that a lot because at Ford, the whole idea of the Model T is the democratization of technology.”
In other words, while Ford may not be a technology pioneer, the technology is available to everyone. The Model T is a car that famously drove Americans to the early 1900s because it was more affordable than other cars at the time.
“So Ford’s idea of self-driving is that you can press a button on the highway and the car will drive for you,” Farley said.
It still requires the driver to keep their eyes on the road and be ready to take over, not just the hands-free driving that Ford’s Blue Cruise offers today. This technology allows drivers to take their eyes off the road while driving.
“Ford will drive the car for you. Hands-free ends up being a doorway where you can take your eyes off the road,” Farley said. “The average American spends 20 to 30 minutes a day on the freeway. I never thought I’d be able to say this in my lifetime. What would you do if Ford gave you 20 minutes of your life back?”
Farley said automakers are a little more than two years away from introducing such technology for highway driving, but it could possibly be the first.
“Elon[Musk, Tesla CEO]is working hard, but we’re not there yet,” Farley said, noting that General Motors and several other companies will achieve eyes-free self-driving around the same time as Ford’s plan.
“I don’t want to be the first one to be okay,” Farley said. “It would be better to be the best in six months.”
Modern Furry Leaders
Farley said Ford is making progress with improved quality, software and the transformation into EVs. But he said there was “no strategy” for how to lead the company into the future and there was still much work to do.
“We needed to get serious about treating the vehicle as a digital device and bringing more services into the business,” Farley said. “There has been a lot of change over the past five years, and we are right in the middle of it.”
As for who Mr. Farley would talk to and who he would be willing to meet for “office hours,” he cited JPMorgan Chase CEO Jamie Dimon by name.
“I talk to him as much as I can. Jamie has been through so much. He’s been through so many different situations in his life, faced so many different challenges, and he’s just gotten through it,” Farley said. “So I think you can learn a lot.”
He added, “But more than anything, I want my grandfather back.”
His grandfather endured the Great Depression and had no money for a long time, but still “spent his life whistling,” Farley said. Farley said the advice his grandfather would give him today is simple. “For me, he would say, ‘Get back to work.’
Jamie L. Lareau is senior auto writer for USA Today and covers Ford Motor Company for the Detroit Free Press. Contact Jamie: jlareau@freepress.com. Follow her on Twitter @Jalalean. To sign up automotive newsletter. become a subscriber.
