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Ford Smart Mobility Launched to Bring Ford to the Cutting Edge

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author photo by Doug DeMuro March 2016

Ford has officially launched a new subsidiary that will help the brand focus on emerging mobility technologies. Dubbed Ford Smart Mobility, the new subsidiary will be based in Palo Alto, California, and will help Ford pursue opportunities with "connectivity, mobility, autonomous vehicles" and more, according to a statement from the automaker.

The move is a big step for a U.S. automaker, as no other major brand has yet set up shop in Silicon Valley, which represents a huge investment in upcoming mobility technology. The closest a rival has been to throwing its hat in the futuristic mobility ring came earlier this year, when General Motors announced a major investment in ride-sharing firm Lyft. But this big investment will likely pay off for Ford given the rapidly expanding popularity of emerging mobility technologies.

"This potential to expand Ford Motor Company's understanding of this dynamic space is substantial," said Karl Brauer, senior director of automotive industry insights for Kelley Blue Book. "Mark [Fields, Ford president/CEO] says the new division will be separate but connected, with a specific governance between the core company and this subsidiary. Ideally, the knowledge will stream in both directions, with Ford benefiting as much or more from Ford Mobility as the subsidiary benefits from the mothership."

Indeed, the "separate but connected" relationship is important for the firm's success, as it allows Ford to focus on building cars, trucks and SUVs, while the new Ford Smart Mobility branch focuses on emerging technologies.

"Past efforts by Ford to transform to a mobility company failed because the company took its eye off its core business," said Michelle Krebs, Autotrader senior analyst and director of automotive relations for Cox Automotive. "Yet the work that goes on within the new mobility subsidiary can feed back into the core business when appropriate if Ford does this right."

Although Ford has not yet announced exactly what that work is, the automaker has said it plans for Ford Mobility to compete like a startup company, both creating new mobility services on its own and collaborating with other startups and tech companies in the region.

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Ford Smart Mobility Launched to Bring Ford to the Cutting Edge - Autotrader