What does one do the day after revealing that your company lost $2 billion last year and left that much in profits, “on the table.” If you are Jim Farley, the CEO of Ford, you announce that after an absence of more than 20 years, the company is getting back into Formula 1, the pinnacle of auto racing.
Red Bull Racing announced that Ford is joining its motor works company to develop the new hybrid engine that will be required starting in 2026. Ford is joining forces with the latest World Championship team. It’s an announcement that is a lot about marketing and a bit about technology development, which is what this newsletter is interested in.
Formula 1 is on a tear. The sport, which has been an also ran in the US for decades, has become cool partly due to the Netflix show, “Drive to Survive.” The program has helped boost interest in the racing series with some drama added to storylines about teams, drivers, and championship campaigns.
RUSH TO F1
There is a rush to get on the F1 bandwagon. GM with the Andretti family wants in, so does Porsche. Honda, which is currently building Red Bull’s engine, is now contemplating if it can stay in after 2025 with a new engine and a different team.
Beyond putting your brand on a hot product, there is something more here. During Red Bull’s unveiling of the Ford deal and the paint job of its 2023 car, Farley highlighted that there is a lot to experiment with in F1. That could help the Detroit company’s move to an all EV future. Software development for controlling the power unit could provide new knowledge.
SUSTAINABILITY
Ford is a family company, and Bill Ford has been talking about sustainability for decades now. He said about the Red Bull deal, “This is the start of a thrilling new chapter in Ford’s motorsports story that began when my great-grandfather won a race that helped launch our company.” But then Ford made a nod to the technology aspects of this partnership, saying the F1 tie-up will allow Ford to bring its, “innovation, sustainability and electrification to one of the world’s most visible stages.”
Ford won’t be building this engine. It will provide some expertise and access to the US market. The Red Bull F1 Team principal, Christian Horner, was quite clear, “there is no exchange of shares or participation within the business,” adding the two companies will, “share and have access to R&D, particularly on the EV side and self-technology, software development.”
FORD BRINGS EV EXPERIENCE
This is where this marketing marriage could get interesting. For decades F1 was fertile ground of auto innovation. Parts of the car you are driving now came out of F1. Your mirrors, engine technology, suspension were all influenced or invented in an F1 race car. But for several years, according to Farley, the technology from F1 was not transferring to automakers, meaning the innovation was not applicable to you and me.
But according to Farley, the transformational shift by carmakers to electrification can now be aided by partnering with an F1 team. “We're really excited to work with this team on the technology side and also learn from them. The best aerodynamicists in the world are in Formula One at Red Bull. And the most important thing about making a small battery, because the battery is so expensive, Is aerodynamics. so we can learn a lot from Formula 1.”
LEARNING F1 EFFICENCY
That is a telling statement. Carmakers know the current batteries, and their chemistry, are lacking. If a manufacturer can make a vehicle more efficient aerodynamically, the battery will last a bit longer.
F1 realized a few years ago it was out of step with the direction carmakers planned to take their companies. That’s why hybrid power units were introduced. The move in 2026 to a power plant that gets half its energy from electricity was apparently intriguing to Ford.
The hybrid engine F1 envisions can also provide insight into software and energy recovery that can be applied to passenger vehicles.
As Farley said, “the sustainable direction of the sport. We're on the same mission at Ford, and we cannot wait to go racing.” Again!