Ford Motor Co.’s long-standing commitment to sustainability is bearing fruit as it recruits new employees and lines up financing for its push into electric vehicles, Ford executives said during a web conference.
Bob Holycross, Ford vice president for the sustainability, noted Ford first made a commitment to sustainability more than 20 years ago. “We’ve been on this journey for a long time,” he noted during an online conference organized on ESG or Environmental, Social and Government issues by RBC Global.
However, Ford’s commitment is now paying dividends with customers, and with investors, who are increasingly concerned about the company’s environmental record. “Investors are looking at this very closely,” Holycross said, and it is a priority.
Green bonds a big success
David Webb, Ford Motor Co. treasurer, noted the company’s issuance of $2.5 billion of unsecured “Green Bonds” was a great success. It was the first fully integrated sustainable financing framework covering both an automotive OEM and its capital finance company, Webb said. “Frankly we were overwhelmed by the magnitude of the response,” he said.
The interest rate on the transaction was a modest 3.25%, which was well within the parameters for a transaction of this type, according to Webb.
It was the largest Green Bond ever issued in the U.S. he added, helping the company pursue its goal of building more electric vehicles, he said. “We’re going for volume and market share, said Webb, noting the company is already knocking out the walls to expand the new Rouge EV center in Dearborn, Michigan.
“We’re expanding very rapidly,” he said, noting the company expects to have the capacity to build 600,000 battery-electric vehicles by the end of 2023.
Webb added Ford is now stockpiling batteries so it can power the new vehicles.
But Holycross noted since sustainability has been part of the company’s operating philosophy for two decades, and the new plants the company plans to build in Tennessee and Kentucky will be carbon neutral since the source of the power will come from clean energy.
Ford is paying close attention to the source of the materials needed to build electric vehicles. “It is top of mind for and for the supply base,” noted Holycross, noting Ford has set up a code of conduct for suppliers that is written into the terms and conditions of their contracts.
Ford also is working with third parties, who are helping police the suppliers, who are often located in unstable regions.
Holycross added Ford’s reputation for sustainable operations and policies is a source of pride among the company’s employees and help attract new employees with the kind of talent needed to build Ford in the future.
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