our legacy auto business has been holding us back

Ford CEO Jim Farley sent a big message to investors on Wednesday at its capital markets day: It’s an EV company first.

“Our legacy business has been holding us back,” Farley said on a livestream presentation to media and analysts.

The auto giant announced it would create two distinct internal teams: Ford Blue and Ford Model e. The maneuver is designed to free up resources so Ford could better attack the opportunity in EVs. Ford Blue — essentially the company’s gas-powered auto business — will be focused on managing profits. That means attention on lowering costs, and plowing those savings into the EV Ford Model e division.

In this photo made on Thursday, May 6, 2021, a pair of 2021 Ford Mustang Mach E are seen at a Ford dealer in Wexford, Pa. Ford is spinning off its electric vehicles and internal combustion businesses into separate units. The automaker said Wednesday, March 2, 2022 that its plan includes two distinct, but strategically interdependent, auto businesses – Ford Blue and Ford Model e. (AP Photo/Keith Srakocic)

Farley stressed Ford will not be spinning off its electric vehicle operations, tamping down recent speculation.

The company outlined $3 billion in cost savings from Ford Blue by 2026.

“We are going all in,” Farley added.

Ford outlined that it expects to produce 2 million EVs by 2026. It sees an adjusted operating profit margin of 10% by 2026, up 270 basis points from 2021.

In total, Ford guided to a $50 billion in EV investment through 2026.

Ford shares (F) rose about 4%in pre-market trading Wednesday.

Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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Source: https://finance.yahoo.com/news/ford-ceo-jim-farley-our-legacy-auto-business-has-been-holding-us-back-133025585.html