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Innovating Today with Eyes on Tomorrow

Ford Motor Company’s Jim Farley and Marcy Klevorn lead automaker’s forward-thinking vision for electrifi cation, autonomous vehicles, and the city of tomorrow.

By Daniel Lai and Glenn Stevens

As innovators go, no company is more in tune with staying in front of the curve than the one that put the world on wheels more than 100 years ago. When Ford Motor Company CEO Jim Hackett, a visionary in his own right, took over the reins of the automaker in May 2017, he knew that to remain relevant in today’s changing industry replete with modern technology, the company needed a forward-thinking strategy — one that embraces the electrified, automated, shared and connected car of the future.

Leading that charge are two of Ford’s top strategists: Marcy Klevorn, Executive Vice President and President of Mobility; and Jim Farley, Executive Vice President and President of Global Markets. Klevorn, a fourth-generation employee who bleeds blue, is credited with leading Ford’s global technology strategy, while Farley led the company’s transformation and explosive growth across Europe.

The Detroiter recently sat down with Klevorn and Farley to discuss Ford’s evolution to mobility provider, the “city of tomorrow,” the company’s legacy, and how it all hinges on the race for talent.

Henry Ford harnessed mass production and the assembly line to put the country behind the steering wheel of an affordable motor vehicle, helping revolutionize society and manufacturing. How do you see the history and DNA of the company playing a role as you transform from an automotive OEM to a mobility company?

Marcy Klevorn: 114 years ago, Henry Ford reinvented and reimagined the manufacturing system in a way that made cars affordable so that the people that built them could buy them. But he didn’t stop there. What he did that I think is so germane to what’s going on today is he thought about the whole ecosystem. He thought about the manufacturing process. He thought about the five-dollar work day to attract talent that normally wouldn’t be attracted to the Detroit area. And then he thought about the need for health care and housing. So, he innovated a whole ecosystem to make his idea come to life. And of course, central to that was the car.

If you take that description and apply it to what’s going on today, it is an ecosystem problem to solve. The business model of a person buying a vehicle, that one-to-one relationship, will still exist in that we’ll still provide cars to people for personal ownership and fleet. But the ecosystem to help solve the challenges that we’re seeing in cities around the world, whether it’s congestion, or air quality, or emerging middle classes in certain areas and changing consumer demands — it changes the expectation of what people want in their products. You can’t do it alone, and you should not just solve one problem. You must think about the impact on all of these factors. That’s where I think Henry Ford’s work is so inspirational.

What needs to happen in the Michigan ecosystem for Ford to remain a key player in the development of connected and autonomous vehicles?

Marcy Klevorn: There’s a lot of talk right now, which is a pride point for those of us that grew up here, that Detroit might be the next Silicon Valley because it is the center for automotive development in the United States and possibly the world. To build on that, I see a lot of excitement. We work with a lot of outside partners from Silicon Valley that are so excited to be part of the transformation of the industry. They see it as the next big thing that can influence the world, not just vehicles, but transportation as a whole.

Michigan could be the epicenter of that, and I think can and will be. Talent will be a huge part — young people, retirees, people who are not native to this area — how you bring all of that together to create a different kind of talent pool is going to be so important. Additionally, you must create an environment that entrepreneurs and business owners want to come and thrive in. How do you make that environment welcoming and profitable for them? Making the regulatory environment friendly is also key, as well as just taking pride in everything that we have here.

Finally, we really want Michigan to be the go to place for technology. So, we’re working a lot with organizations around the state to get into schools. I’m associated with a group called Michigan Council of Women in Technology; if you want to have women in tech, you have to have girls in tech.

How do initiatives such as Ford GoBike, Chariot, and your pilot program with Beaumont on non-emergency medical transport fi t into the company’s vision for the city of tomorrow?

Marcy Klevorn: First, we need to address traffic fl ow in cities. My son lives in New York City. The average speed in Manhattan is 8 miles per hour; it’s painful to get across town. Whether it’s getting people from point A to B or moving goods, we have to figure out how to accommodate that more efficiently. Different modes of transportation can help the fl ow of traffic by reducing the number of vehicles, whether it is using Chariot or a bike for last-mile commutes.

Gathering data on how people use technology in crowded cities can also shed light on solutions. My son does not own a car because it is too expensive, but he knows how to string together all different modes of transportation to get to where he needs to go, whether it is walking, taking the subway, or Uber. If you think about how Ford can help, maybe it’s an app that says, “Based on the time of day or based on the weather, here’s the best way to get from point A to point B. Here’s the way that includes a trip by Starbucks because we know you like that.” I think we can help make it a more pleasurable experience for people and help decrease some of the congestion in cities.

What is the difference between Ford’s talent needs of today as it embarks on the new mobility focus – as opposed to 20 years ago? How is Ford addressing this challenge?

Marcy Klevorn: If I reflect back on the difference in the kind of people you might want, in the past because things didn’t move as quickly, you could hire for a specific skill, and that would last. It would transcend time. And now that things move so quickly, while you might hire for somebody that has a certain skill set, the thing you also want to look for is their ability to adapt and learn. And if they know one coding language, can they learn another? If they understand one business model, can they adapt and invent new business models? It’s less about hiring for a specific skill and thinking that’s going to last, and more about hiring somebody that has the specific skills that can learn, change, grow, adapt, apply and connect dots. Also, don’t be afraid of ambiguity.

Ford continues to affirm its commitment as a global company. Given your role in the China strategy and your leadership role overseeing Ford’s business transformation in Europe, how important is it to have a global presence and strategy?

Jim Farley: Although it’s filled with challenges, if we see a compelling road to profitability and the physicals are there, even if the short-term is challenged because of the market, i.e. what we’ve been through in places like Russia, South America and India, where the market dropped in half, of course globalization is a priority. The profitability profile of the company is always shifting. Today, North America’s market is very strong but we could have a recession or a fuel spike. Being established in global markets is an insurance policy in a way. During the automotive recession of 2008, Europe was profitable and South America was making a billion dollars a year. While we didn’t go bankrupt, without those operations who knows what may have occurred.

Secondly, when you look at markets like India, Russia and southern Europe … that’s where most of the growth is coming globally in the next 20 years in our vehicle business. We have a lot of other changes coming, but in the vehicle business the emerging markets are not easy. They are all very different. People like to put them into one big bucket. What it takes to be successful in India is very different than Turkey or Russia, and that’s very different than Mexico, and Indonesia. I think we’re well-positioned. We’re also a dominant player in areas like Africa and Thailand because of the Ford Ranger.

How will the transformation of electric and autonomous vehicles play a role in the importance of personal style? Will individuals no longer care about the color and design of a vehicle, instead opting for a generic autonomous pod? Is this a cultural shift the industry will soon be facing?

Jim Farley: Most of these technical transitions don’t happen overnight. What I find with people, if you use our current life as proxy, plenty of us own a Mustang and take an Uber to the airport. It’s not an either/or. There are times when you just want to get from point A to point B. What you’re looking for in that kind of vehicle, is the best connectivity. When I’m sitting in the back of that vehicle, I want it to work like my house.

There’s going to be F-150 customers out there for many years. I think some of those F-150 customers would love to take an automated drive to the Dallas airport. We’ll figure it all out, but it’s going to be mixed for a while. So yes, putting energy into different products and brands does make sense in this new world because we own our work. We have some passionate brands, like the ST and the RS Focus, or the Mustang. The performance business is a big business. For us, we see leading into those spaces as we electrify and as we complement customers’ ownership of autonomous vehicles.

You recently wrote a blog stating, “To get to the self-driving future we can all imagine, we need to build a business today that has a foundation for longterm success.” A key challenge Ford has versus some of the autonomous upstarts is designing, engineering and building the F-150 and Lincoln for the market today while at the same time preparing for the future. How is Ford leveraging its foundation of today AND balancing its position in this new mobility world?

Jim Farley: We have some real significant assets when we look in the autonomous vehicle business. For one, we’re an integrator, we’ve been doing it for 114 years. We know how to put a VDS with duplicate braking, duplicate steering system, and have it all work flawlessly.

For decades, we’ve had one of the highest volume commercial vehicle transport products as a platform. It used to be the Crown Victoria, and then it became hybrids. We’re No. 2 in hybrids in the United States. Our hybrids and their battery packs have gone 300- 400- and 500,000 miles. Every day we deal with those.

We’re also a dominant player in the police business, other OEMs can’t say that. Those police Explorers used for pursuit vehicles have very high mileage. They are designed for 250,000 miles or more. We’re talking seats, body structure, suspension components, etc.

Second, we have a dominant position in commercial vehicles here and in Europe. We know the people at the job sites. They trust the Ford oval, just like cities do, more than a lot of the other technology companies. If we were to go to a city, or to a job site, and say, “We’re going to deliver the goods for a local Home Depot,” that means something different than another company, because we’ve been part of their life for a hundred years. In terms of moving goods beyond ridehailing, we think we have a real strength in autonomous vehicles because we know the customers well.

As you look at the history of Ford, your own experience, and how the world is dramatically changing, what advice would you give to young people as they potentially look at a career in automobility? What might you say to youth, someone looking to move from another place to come to Detroit, or others who might consider a career at Ford?

Jim Farley: Our industry is changing for the biggest time since a hundred years ago. I can’t think of a cooler place. You look at our board members — they’re from Silicon Valley and venture capital. Why do they find it interesting to be at Ford? Because it’s all there. We touch so many lives. We touch globally. We are heavily regulated. We have to fix a core, our vehicle business, and we have to allocate capital and get into new businesses, from city solutions to automated and electrification. At Ford, you could live in 16 different countries and work on game-changing technology.

As for Michigan, there is nothing more exciting than where I live in downtown Detroit. For a young person, this is just as cool as San Francisco, you just should have snow boots and a parka. Beyond that, I take the QLine to the ballgame with my friends. I go over and watch a Tigers game at the third baseline and answer my emails at night. I have a completely urban life. I don’t even use my car on the weekends. I love living downtown. It has totally reinvigorated my life. You have restaurants, energy, sports, and all the history you want.

Daniel Lai is communications manager for the Detroit Regional Chamber and editor of the Detroiter. Glenn Stevens is the executive director of MICHauto.