Ford Motor Co.’s first long-range battery-electric vehicle, the 2021 Mustang Mach-E has officially gone on sale – and you can read a review by Clicking Here.
Taking dead aim again the likes of the Tesla Model Y, the Mach-E is part of an $11.5 billion commitment by Ford to become a major player in the emerging market for electrified vehicles. But just how big that market will be remains anyone’s guess.
But “it’s going to happen faster than we expected,” said Hau Thai-Tang, the automaker’s global product chief, in an exclusive interview with TheDetroitBureau.com. And, in the process, it will not only change the way Ford designs and builds cars and trucks, but the way it markets and supports them long term. Like key competitors, Thai-Tang said, Ford now expects to offer software updates and new features, much like you get with your smartphone, to keep products fresh even years after they were purchased.
TheDetroitBureau: You must be glad the new Mustang Mach-E is finally out on the road.
Thai-Tang: Glad to be able to share this with people.
TDB: The arrival of the Mach-E and other EVs makes me think we’re approaching an inflection point.
Thai-Tang: When we were researching this product we brought in some (existing EV) owners and one of the questions we asked was what was the likelihood you’d buy another battery car next time and 60% of them said “definitely,” and another 30% said “likely,” so 90% of those BEV owners, even with the limited supply we have today, with compromised products, are going to buy another one. As we see more product entries and more and more customers … that’s going to have an exponential effect.
TDB: Satisfaction among BEV owners is high, with expectations that whatever they get next will be better. That’s one of the keys, isn’t it?
Thai-Tang: That’s one of the keys, yeah. We’re in an early phase and for many OEMs, it’s their first product generation. It’s gonna get better, and at a much faster rate. We’ve been working on internal combustion engines for 115 years and it’s reached a level with little improvement.
TDB: One thing that concerns me is the recent rash of fires involving EVs. And Consumer Reports (in its annual Auto Reliability Study) noted a lot of problems with recent EV launches. With the Mach-E, it would seem, you will have to avoid having any initial quality issues. How do you avoid them?
Thai-Tang: All vehicles are sensitive to good launches. We have four big launches so far this year and three are already going really well. The team really got back to basics and worked, even through the COVID crisis, to ensure we can execute well.
TDB: Some competitors, like Lucid, are launching their highest performance models first. You’re saving the Mach-E GT for last, next year. Why?
Thai-Tang: I don’t think we would change that. This is the history of Mustang and that’s our typical approach, start by launching the base and GT and then following up with special and high-performance derivatives over time. My mom always told me, “Don’t wear all your new clothes on the first day of school. Space it out over time.”
TDB: What have you learned from this project so far?
Thai-Tang: Wow! Where do I begin? We’ve changed the way we work (in product development). The creation of Team Edison (which developed the Mach-E) was an intentional decision on our part to try to disrupt ourselves. The learnings from that are cross-functional and informed the organizational changes that (CEO) Jim Farley just rolled out. I now have product development, purchasing and advanced manufacturing working together side-by-side. The importance of the technology – the connectivity, the next-gen electrical architecture, over-the-air updates – that’s really game-changing for us.
It’s allowed us to not only deliver great features and functionality but change the business model from a transactional model where you buy a product and I hope you come back in the future and buy another one. Now, you drive the vehicle off the lot and it gets better with age because we’re updating it and giving you the ability to buy new features. It’s changing to a use model where we can sell features over the life of the vehicle.
TDB: There’s also a benefit to using over-the-air updates from a quality and reliability standpoint, isn’t there?
Thai-Tang: Traditionally, we had to wait for a lot of vehicles to have a problem to find out about it through quality data. Then we’d have to go and do a recall, maybe nine months later. Over-the-air is game-changing for us. We can fix problems without having to wait.
TDB: Ford and GM were among the first to offer subscription services, like OnStar. Is that model set to really take off? I know that a lot of automakers are talking about letting owners pay for features and add subscriptions, much like with smartphones.
Thai-Tang: We have great examples with things like Sirius radio where customers are willing to pay for a subscription. You shouldn’t expect us to charge people for things that they would expect to get today. But it’s definitely an opportunity for future incremental things where they’re going to get more value.
TDB: Give an example? What might someone who buys a car like the Mach-E today want from a subscription or update?
Thai-Tang: Our driver assist technology, Copilot 360, is one example. Features that address customer pain points, like parking, say, a valet mode that makes it easy to get in and out of a tight garage. If I gave my wife an update with a valet mode to pull out of our tight garage on its own, she’d be willing to pay for that. We have the radar and sensors, and other technologies that we can add more functionality for customers. Some things may not be ready at job one but, if all the hardware is there, there are things people might want to pay for. Even the ability to customize the look and feel of your instrument cluster, a bespoke skin, like there is for my phone.
TDB: Might you also take a model from the computer industry by allowing hardware updates? Mach-E uses 4G LTE, but 5G is rolling out and 6G could be here by mid-decade.
Thai-Tang: That’s something we’re looking at. We do that in the more traditional vehicles. You can replace wheels and tires, update performance modules for your Mustang. What will be the equivalent model going forward in your electric vehicle? Today, it’s very difficult. As we change the electrical architecture (for BEVs), it could be a lot easier for us to do that.
TDB: We’ve seen competitors like GM announce in recent weeks big upgrades in their spending on electric vehicles. Ford went from $11 billion to $11.5 billion on electrified vehicles. I have the feeling you might want to ramp things up even more.
Thai-Tang: Well, we are. We’re going as fast as we can. But having tangible proof: products at attractive price points is what resonates with customers, rather than making proclamations on how much money we’re spending.
TDB: Compared to what your plans were two or three years ago, are you accelerating them? Do you have more product coming than you would have envisioned two or three years ago?
TDB: And is there a shift in what type of (electrified) products, BEVs versus hybrids or plug-ins?
Thai-Tang: I would just summarize by saying that in the plan Jim Farley shared, he’s really leveraging technology and electrification as ways we’re going to disrupt ourselves. He’s very bullish. We’re allocating more resources and our commitment around battery-electric vehicles is higher than what we (targeted) previously. It’s going to happen faster than we all expected.