Ford Bites Apple for a Taste of Tesla

(Bloomberg Opinion) -- The car business has a rich history of mavericks. Lee Iacocca brought Chrysler Corp. back from the brink in the 1980s. Alan Mulally mortgaged Ford Motor Co.'s blue oval to steer away from bankruptcy in 2008. Carlos Ghosn had that magic-trunk trick. When it comes to the new age of electrics and autonomy, Tesla Inc. can only be understood as an extension of Elon Musk.

So news that Doug Field has defected from Apple Inc.'s vehicle project to Ford, broken Tuesday by Bloomberg News, is a big deal. Field isn't coming in as CEO, of course; he'll report to Jim Farley as chief advanced technology and embedded systems officer. But his pedigree in all the new stuff Farley wants Ford to lead in is formidable.

Having begun his career at Ford, Field has since worked for inventor Dean Kamen at DEKA Research and Development Corp. and Segway Inc., done two stints for Apple, and was a senior engineer and one of a handful of named executive officers at Tesla, overseeing the rollout of the Model 3. Granted, that ended on something of a bum note, with production difficulties, a weird email to employees imploring them to “prove a bunch of haters wrong” and an extended leave of absence and exit.

The hopeful read of that last one is that Field should be well aware of the perils of mass auto manufacturing (he no doubt gained some valuable scars with Segway, too). In any case, he brings a hybrid of Detroit and Silicon Valley experience and contacts to Ford. He has intimate knowledge of the ambitions and capabilities of a formidable competitor, Tesla, and a potentially formidable competitor, Apple. His departure from the latter might suggest that particular competitive threat remains far off, but who knows? After all, if turnover in the senior ranks spelled doom, then Tesla would have been finished years ago.

Above all, Field's arrival at Ford signals intent. Incumbent automakers, including Ford, have gotten a taste of the Tesla magic this year, enjoying sharp rallies after announcing a big push into electric vehicles and AI.

It's just a taste, though, with the euphoria wearing off quickly. Ford's current earnings multiple of eight times is decent enough compared to history but remains more Michigan than California.

Bringing in Field to build Ford's digital, connected-car capabilities reaffirms the company's commitment to the transformation, regardless. It's also a way of leveraging its existing model line-up, long before electrification takes over. Besides the hoopla over the F-150 Lightning electric truck, Ford is scoring quiet wins in mundane stuff such as build-to-order manufacturing and lean inventory. The Mustang Mach-E is, remarkably, profitable already, according to the company. Meanwhile, Ford's autonomy partner, Argo AI, continues to expand its already wide testing network.

Does this guarantee success? Of course not; this is the car business, folks. It takes a lot of things to go right to produce just one model that sets hearts racing, let alone reengineer an entire industry (see this). Still, you don't get anywhere without at least appearing to be serious about it. The most immediate advantage Ford gains from hiring Field is that it can now say Ford is the sort of place where someone like Field wants to work.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker.

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