The Pentagon Reportedly Asked GM And Ford If They Could Help Build Weapons

In his book The Arsenal of Democracy, A.J. Baime makes the interesting historical observation that an Allied B-24 built by Ford in Detroit likely dropped bombs in Northern Italy on a repurposed Ferrari factory building tools and equipment for the Axis, just a few years before the two companies would lay down their arms and battle on the track at Le Mans.

A new report says that the Pentagon approached Ford and General Motors to help with shoring up the country’s defense stocks (an Arsenal of, uh, Kleptocracy I guess). The timing is interesting given that the White House has also asked automakers to use all their factories to build more cars. For Ford, that’s a big deal as the company transitions into an advanced manufacturing arm… without its chief of advanced stuff.

This White House has been trying to get carmakers to build more affordable cars at almost any cost and, by one measure at least, cars are a little bit more affordable. You know what might be truly affordable? Chery’s new EV van for Europe. It also has a hilarious name.

What Could GM And Ford Build For The Department of War?

Iran doesn’t make a lot of cars, and I haven’t heard anything about the factory still building Peugeot 405s getting bombed, so I’m not sure that we’ve yet reached the modern equivalent of Ford vs. Ferrari. This new type of war seems to be more about missiles, drones, and the interception of missiles and drones. Given that automakers represent a large percentage of your typical industrialized country’s complex manufacturing, there’s been a surge in carmakers talking about becoming makers of weapons.

French automaker Renault is planning to produce drones at an underutilized factory, and Volkswagen has reportedly talked to the maker of the Iron Dome to build components for the air defense system. This makes this Wall Street Journal report on the Pentagon approaching GM and Ford about helping with the war effort perhaps not that surprising:

During the talks with U.S. manufacturing executives, defense officials framed bolstering weapons production as a matter of national security.

The officials asked whether companies could help as the Pentagon seeks to shore up domestic manufacturing capacity, the people said. The officials also asked executives to identify barriers to taking on additional defense work, from contracting requirements to hurdles in the bidding process.

Oshkosh, based in Wisconsin, entered a dialogue with the Pentagon in November following Hegseth’s call for companies to boost production, said Logan Jones, chief growth officer for the company’s transport segment.

Its discussions have centered on “where could we bring that capacity in a way that matches our core capability,” he said.

GM makes a lot of sense, as the company’s GM Defense arm already makes an infantry carrier for the Army, as well as up-armored Suburbans. Oshkosh is, historically, a big supplier of large vehicles for the military. Ford is a little more interesting, as the company sold its defense subsidiary (Ford Aerospace) back in the 1990s after making a bunch of missiles, including the legendary Sidewinder.

If you only have a hammer, everything like looks like a nail. If you have a Department of War, does everything look like a war? Maybe, but the War in Ukraine and this latest conflict has dramatically reduced the country’s missile stockpiles, and now the Department of War is looking to replenish stocks and asking for a historically large missile budget. The biggest issue might just be that we can’t build missiles fast enough, as Breaking Defense points out:

Ultimately, Congress is going to have to take a serious look at what industry can actually deliver before it signs off on such a historic spending plan, said Carlton Haelig, a defense budget expert at the Center for a New American Security.

“I would suspect that right now there is an extreme delta between what the department expects on an annual basis and what industry is able to produce with the supply chains and the manufacturing pipelines that they have in place right now,” he said. “I fully support the amount of munitions being requested. I think it’s the right call. But we need to start talking about the defense industrial base support for that request.”

What’s curious here is that the Trump Administration’s approach to manufacturing has been to try to get companies to utilize as much of the country’s factory output to build cars. Perhaps all those scuttled EV projects can be used to build missiles.

Ford’s Chief Tech Guy Out, Replaced By A Committee

It was a big deal when Doug Field came to Ford, given his background at Tesla, Segway, and Apple. According to this Ford release, he’s out and is being replaced by what sort of sounds like a committee?

Ford Chief Operating Officer Kumar Galhotra will lead the unified Product Creation and Industrialization organization. The team will be responsible for scaling Ford’s digital, design, and electric vehicle breakthroughs across its global industrial system, ensuring that innovative technologies are integrated with world-class engineering, purchasing, and manufacturing.

“The progress our teams have made in the past few years – from quality and cost to software delivery – has fundamentally reshaped the way we work and positioned Ford for a new era,” Galhotra said. “By uniting advanced technology with industrial execution, we can make decisions faster, eliminate complexity, and deliver great vehicles and digital experiences with the quality and efficiency our customers and shareholders expect.”

Doug Field, who joined Ford nearly five years ago to lead the company’s shift to electrified, connected and software-defined vehicles, has elected to leave the company after a transition over the next month. During his tenure, Field embedded high-tech capabilities into the company while building a world-class team and culture. Crucially, Field also helped foster collaboration between the Electric Vehicle, Digital & Design and Industrial System teams that made this full integration possible.

The press release is very friendly! However, as CNBC points out, not everything worked out as planned under Field’s tenure:

[M[any of Ford’s initiatives involving software and EVs did not perform as expected. Most notably, the automaker reported significant shortfalls in generation of software revenue and in December announced it would write down $19.5 billion related to a pullback in EVs and realignment of business priorities.

While several automakers have announced such impacts due to EVs, Ford’s write-down was much larger than its closest rival, General Motors, which has announced roughly $7.6 billion in such charges.

Given that basically every major automaker took a bath on EVs, it’s hard to pin the failure on just one person, and Ford CEO Jim Farley made a point of stating the importance of Field.

Car Affordability Improved In One Metric

My most controversial take is probably that the economy under Joe Biden was pretty good, all things considered (pandemic, PPP, et cetera), and that the current economy under President Trump ain’t that bad either. Yes, it’s K-shaped. Yes, private credit or some other financial iceberg lurking under the surface could collapse it all, but unemployment is relatively low and inflation isn’t catastrophic yet.

There are many ways to look at the affordability of cars, and price isn’t always the best one, if only because it can be skewed by buyers grabbing giant crossovers. Another way to look at it is the way Cox Automotive/Moody’s does, which is to look at how many weeks it takes the average household to afford the average new car, and numbers continue to improve:

The typical monthly payment for a new vehicle fell by 0.5% in March to $752, but was higher year over year by 2.9%, up from $731 a year ago. Still, with household income higher by 3.9%, the number of median weeks of income required to buy the average new vehicle dropped to 35.1 in March, down from 35.4 weeks in February and at the lowest point in nearly four years.

While new-vehicle affordability in March was better than it was a year earlier and continues to generally improve as household income grows, other challenges continue to place pressure on vehicle affordability in the U.S.

Yeah, here’s the catch:

In addition to the immediate financial pressure of $4-a-gallon gas prices, major vehicle ownership costs such as maintenance, repairs and insurance have all seen sustained, outsized increases since the pandemic. For example, while new-vehicle prices are higher by roughly 15% versus 2021, some estimates suggest vehicle insurance costs have increased by nearly 60%, while routine service and maintenance costs are higher by 40%. The compounding effect of these higher prices is at the heart of today’s affordability conundrum.

The best way to lower car ownership costs is probably to lower fuel and insurance costs, which doesn’t seem to be happening anytime soon.

Behold, The Delivan

Chinese car company Chery is planning to sell a commercial van in Europe, eventually, and it’s got the perfect concept. Delivan!

Positioned as a forward-looking commercial vehicle proposition, DELIVAN will be introduced as well as a series of DELIVAN concept vehicles, offering an early preview of the company’s product, technology and design direction ahead of a planned European product launch in 2027.

Commenting on the upcoming moment, Jolly Yang – VP of Chery Commercial Vehicle and CEO of DELIVAN said: “This is a defining moment for Chery Commercial Vehicle as we take our first step into the European market at the Commercial Vehicle Show. Europe represents one of the most advanced and demanding commercial vehicle environments in the world, and it is exactly where we want to demonstrate the strength of our vision, our technology and our long-term commitment.

I get that this is a portmanteau of Delivery and Van, but I immediately scanned it as Deli and Van. Maybe I’m just hungry.

What I’m Listening To While Writing TMD

I enjoy They Might Be Giants, even if I’m probably a few years too young to have become obsessed with them. Still, a new song is worth celebrating. Please enjoy “Get Down” from the ideally-named Particle Man YouTube account.

The Big Question

What’s the strangest non-car object ever produced by an automaker?

Top photo: GM Defense