All right. Good afternoon, everybody. Thanks very much for spending this hour with us and not having cocktails yet. I know that you have to whiz off right after, so you'll miss that part. But ladies and gentlemen, welcome to our fireside chat with John Lawler, Vice Chair of Ford. John, thanks very much for being here today. Thanks for having me. It was a long day, so I appreciate you sticking around for us to have this discussion. Maybe what I'd like to start with, you've recently, fairly recently, switched roles at Ford. Mm-hmm. What's on your agenda now? How's your day changed? Kind of what are you looking at now? Yeah. So, you know, I think the industry at this time is going through one of the most important transitions we've had potentially ever. What I'm doing is I'm spending my time working with Jim and the executive leadership team on how we best position Ford to win coming out of this transformation of the industry. That's heavily rooted in strategy, some in policy, and leveraging the 35 years of experience I have at Ford and globally, to help do that. If you step back and you look at what's happening across the industry, it's the confluence of many different factors. If you think about it, electrification has come in and changed the industry quite a bit. The ICE tail is gonna be much longer. The development of multi-energy vehicles, that's gonna have a long tail. You've got distributed electrical architectures. You've got the intelligent connected vehicle. You have autonomous driving technology, all coming together at the same time. All of that is going to require the OEMs to think about how you position yourself for success going forward differently. Everybody can't do all of that on their own. When I listen to you explain that, it sounds a lot like this is a job that doesn't tackle the next quarter, not even the next year. What's the timeframe really you're thinking about as you approach this role? One of the nice things about our structure in our company is that, of course, we have to make our quarters. Of course, we focus on that. And as you know, I've spent a lot of time over my career in that space. This is a nice shift for me, but we do have a long-term horizon. We are talking about the next three to five years and setting ourselves up to be successful, coming out of that. We have a lot of work to do in the near term, and none of that's changed. Our focus on cost and quality is, you know, at the top of the list. Every day as a team, we're focusing on those two deliverables because we know that is an enabler that's going to allow us to do what we need to do strategically to position ourselves to win. Although that's not a big part of my remit any longer, moving from CFO to Vice Chair, everybody in the company is involved in that with Jim and the leadership team, just every week, just about every day. We're still involved in that. I hope I can contribute to that as well positively and support Sherry and those efforts and the rest of the team. It's a three to five-year horizon. It's about the future and setting ourselves up. Ford, over the past couple of months, past two years, has done already some major changes, resets. You've repositioned some of the EV programs. You've just repositioned kind of the digital STV architecture that you wanna go for. You've talked a lot about capital discipline. What key elements of the original Ford Plus plan kind of are still in place, and where have you had to make adjustments? Yeah. I would say that the changes that we've made really come about because our strategy is a series of decisions, the decisions you need to make. We've adjusted and made different decisions based on how the consumer's changed or how the marketplace has changed. If you step back and look at the priorities that we have, they haven't fundamentally changed, but how we're approaching them may have changed a bit. Cost and quality is still number one, as I just said. We have to get that right. When you look at it, the segmentation is proving, I believe, to have been a smart move because Pro is a very important part of what we need to do. That's gonna continue to be a very core element of our strategy and positioning ourselves for success. With Pro, it's a—it's a business and an opportunity that no one else can match. We have a 40% market share in North America here relative to vehicles. With those vehicles comes along the ability to sell software services as well as physical services. When you step back and you look at it, when we look at our strategy and we look at the areas that we're focused in on and you look at the industry and the transformation, our industry has been plagued with very low margins. You all know that. Why is that? We haven't had a lot of top-line growth. Our margins are relatively thin compared to best-in-class industrials. Our capital efficiency is not very good. We're very cyclical. We're not a durable business. Peak to trough is quite extreme. Every time there's a recession, the conversations come about, about, well, who potentially is gonna run out of cash and go bankrupt. That—that's unfortunate. Those are the things that we need to solve. When you look at Pro, it addresses many of those. The margins are better than what we've seen. We've proven that the last couple of years, right? Mid-teens is where we're targeting, and we've done pretty well with that. It's a growing business. Software and services in the Pro business are growing at a 20% clip. Our paid subscriptions are over 675,000 customers right now. Our RPU is growing. When you look at that, those software services have margins of over 50%. That's countercyclical. Those aren't gonna go away in a recession. Those are gonna continue. Physical services, that's growing as well. We have about a 35% attach rate. Every point we grow in physical services is worth $30 million of EBIT. Again, that's countercyclical. Higher margins, gross margins of 30% plus. In Ford Pro, I think that is the definition of how the business needs to change to address those four issues. Capital efficiencies are there as well, as we've run through with the platforms that we have in the commercial business. It's a great business for us. That's going to be important. Software-defined vehicles, the intelligent connected vehicle is going to be a critical part of the transformation in this industry. We're seeing it in other parts of the world, and we're seeing it accelerating. It needs to happen with us very quickly. That's a key part. Growing our service business is a key part of that. and so that strategy all remains the same. We're gonna stay in EVs. We're gonna continue to invest in our advanced electrical development team out in California. There's a lot of benefits that are coming from that. That's not changing, but we've adjusted based on the customer feedback we had being in the marketplace early to what types of vehicles are actually gonna resonate with customers and how do we make them more affordable so that we can attract a larger cohort of customers because large vehicles are not the right form factor for EVs. You're gonna—we're gonna have some of them, but they require large batteries. And batteries are the largest cost in an electric vehicle. If you go with a smaller vehicle, you have a smaller battery. It's more affordable. We believe that's gonna be a competitive advantage for us, especially with the way we're developing those. We can talk about that a bit later. It's all the parts again, Pro, software-defined vehicles, the digital electrical architecture, intelligent connected vehicle. It's the electrification. Of course, we're gonna continue to leverage our strength in ICE vehicles and the great nameplates and brands that we have, anywhere from F-Series to Super Duty to Bronco to Expedition, Explorer. We're still very strong in all those segments, and we're gonna continue to grow there and continue to build out the competitive advantage we have in powertrain of choice and providing multi-energy vehicles. I mean, we have the number one and the number two hybrid vehicles with our pickups. Those are the areas that we're gonna continue to focus on. How we go about executing those strategies to work on those four elements I talked about, speed, capital efficiency, margin, and durable business, it's changing. If you think about the original thinking around Ford Plus and where you are now, how have your investment priorities changed? We think about the R&D budget. Is it as simple as dividing it into four pieces and saying it's ICE, EV, hybrid, and software? Or how would you kind of frame that for investors? No. It's, where can we get the, the best return and do we have the ability for creative growth? It's really a top-down approach. Honestly, in the past, a lot of times when we did the capital allocation, it was more of a bottoms-up product-driven process. Now we're starting to look at it 'cause we have the four business units, and we have the ability to think about things over a longer arc when we're doing our strategic, planning process. Then we're allocating capital into the growth areas, and we're doing it based on the, higher order of return. Every one of the business units that we have has a hurdle rate. Every one of the business units has to come into the capital committee and demonstrate the use of their capital, the return that they're gonna get on that capital. We're making the decisions as a team as to where we wanna grow and how we wanna allocate that capital to grow. I'm gonna—before we get into more of the strategy, add in kind of the necessity to talk about tariffs. Mm-hmm. I'm gonna phrase it slightly differently and ask, with what's going on right now, are there any opportunities for Ford in the next 12, 24 months if we kind of continue with the framework we're seeing right now? I think we do have a competitive advantage because we are the most American, right? We employ more workers. We build more vehicles in the U.S. We do have that competitive advantage given just the structure of what we have from a footprint standpoint. You know, we guided what from a tariff standpoint that the gross impact was $2.5 billion, and that was $1.5 billion. You know, we're continuing to work on that and understand that. At this point, there's not much that's changed, and so there's no material change versus what we guided. We're continuing to leverage our competitive advantage and our footprint to try to identify opportunities for us over the next 12-24 months where we can take advantage of the shifting environment. If the current tariffs were to stay kind of in the rough shape they're in now. Mm-hmm. Do you think there's incremental opportunity for you over the next one or two years to kind of even reduce that net headwind you talked about in your guidance? What are kind of some of the drivers within that? I think so. You know, part of that is, when you look at the parts, pushing more of those parts to be U.S.MCA compliant, that's a tact we can take. We can onshore parts that aren't onshore today, although a large percentage of our parts are. Those are different tactics that we can take working with the supply base to minimize some of that impact. You know, we're gonna continue to work on all of the levers that we have around the exposures and reduce those. We'll also have to look at the go-to-market end of it as well. Are there gonna be additional opportunities there beyond what we've identified so far? A lot of that also is going to be the reactions of counter tariffs and other things that happen there. What does that mean for us? How will we adjust to that? It is a dynamic environment. Things are changing. I think that in that, there is gonna be additional opportunities both on the top line as well as on the cost side and then in the footprint and how we optimize that. Right. The second big part of the change the new administration's brought along is kind of a de-emphasizing of the EV transition to some degree. We're potentially facing the phase-out of incentives. Towards the end of the year, there's been conversations around changing EPA targets. We've seen the CARB waiver being challenged. Has that changed your long-term ambition in terms of electrification? You know, electrification, it is the way we talk about it. It is not a—not if. It is how fast. I think we shifted 12-18 months ago about how fast that adoption curve is gonna happen. You know, coming out of COVID with the early adopters, there was a false signal across the industry that EVs were going to ramp much quicker. We have seen that curve flatten out quite a bit. We have all adjusted. We are adjusting, continuing to adjust our footprint, our investment levels, and pull back on the capital going into EVs, but we are not pulling back completely on investing. They are going to come. We are really excited about the advanced EV team in California and what they are developing for us, for our next generation of EVs. We think those are gonna be a game changer. We are excited about that. We're also leaning into our hybrid technologies. That's an opportunity as well as a bridge into full electrification. Some of these hybrid technologies really do address some of the concerns that the early majority have about EV adoption, range anxiety, affordability, things along those lines. I think that as we ramp that up, that's an opportunity for us. It's a bridge into EVs. We believe that where we're shifting our focus on EVs to small, more affordable, mainstream products versus what others and what the industry has leaned into so far when it comes to EVs. We think those are all opportunities for us in that, you know, the EV horizon, although it's flattened out, is still gonna—it's gonna shift. It's gonna happen. It's just gonna take longer. How does this look in Europe for Ford? In Europe, we just launched the two products we just launched out of Cologne. I think adoption in Europe, they're not experiencing potentially the same pullback necessarily on CO2 requirements. I think they're gonna still be pretty strict. As a global player, we're gonna have to make sure that we can meet the requirements of the EU and the emissions requirements. We're gonna continue to have investments there. With the new platform that we have, we believe it's the right platform to allow us to compete competitively in that space. What does compete competitively mean for your bottom line? Yeah. That's a great question. When you look at the EVs and the development of EVs, when you look at California, there's basically two development processes in the world. There's the traditional linear waterfall process that we've been using for 120 years. Then there's a more agile, iterative process that's being used with many of the EV startups, with the Chinese, and with the team in California. That process is allowing us to engineer and design the vehicle to be much lower cost and to be much faster. The process will eventually be much faster than what we've had in the past. We'll be able to change quicker. That's going to allow us, we believe, to be competitive with the Chinese built in Mexico. We think that's gonna be a game changer for us. We really believe that, those segments that we'll be in, the mainstream segments, are where we'll attract more customers because they're more inclined to buy an electric vehicle. That's kind of a 2027, 2028 timeline. 2027, 2028 timeline where we'll be launching those products. Yeah. Is there any hope for a gross profit break even between now and then? When we get to our next generation, our next platforms, what we've said is that those will be EV positive within 12 months. We're still working to take the cost down in Model e today. You know, we're making progress. We've seen that. I think overall, we're gonna continue to invest in EVs now. That investment is going to, you know, hit the bottom line today, but it's gonna pay us dividends in the future as we launch the new platform and the new vehicles. If you say kind of competitive with the Chinese built in Mexico, we can kind of say, "Okay, this is kind of towards best in class EVs. Mm-hmm. How are you thinking about the rest of the field? If you think about the U.S. in three, five years' time, about Europe in three, five years' time, do you think there'll be many companies next to you at that point? Or do you think you have an edge by going the route you're going with the EV team in California? I think the EV team in California is gonna give us a get an edge against most of the players. If you look at the Chinese, I think the Chinese are gonna be a force to be reckoned with globally. Their development times are very fast, you know, 24 months from concept to production. Their cost structure is about 30% lower than anywhere else in the world. Their digital electrical architecture and their intelligent vehicles, their system, their software is developed at a faster pace than anywhere else around the world. I think that they're gonna continue to be a force we have to compete with. We're gonna need to compete with them globally. You know, they have roughly 10-11 million units of excess capacity. They're exporting from China. They're growing in Asia outside of China. They're starting to enter into Europe. I think that's who we need to set our sights on and who we need to be competitive against, not only from speed of development, software capability, electrical architecture capability, and then just overall electrification capability. That's who we're targeting, and that's who we're looking to be competitive with. As you go into that next generation of vehicles, 2028 following, how long does it take you to bring those advances in EVs in software architecture to the entire portfolio? It's gonna be a build-out over time. One of the things that we've done recently, and we announced this, is we made an adjustment in our approach to our electrical architecture because what we're finding is that since the ICE vehicles, internal combustion vehicles, are gonna be around longer, then we're gonna need to have the same capabilities or similar capabilities on those. We've adjusted our approach on our advanced electrical architecture. We've adjusted that so that we can cover a broader range of our products quicker and that we can be competitive with that software-defined vehicle, that intelligent connected vehicle across more of our portfolio. I think that's a complexity that traditional OEMs have relative to the pure EV players because they just have the electrical architecture to support the EV propulsion system, whereas us, as a multi-line manufacturer across both ICE and electrification, have to do both. We've made that adjustment, and we're going to bring that technology because we think it's important, especially for our Pro business, to be leading edge there on both ICE and electrification, electric vehicles. Let's dive into the software bit of the story. Can you frame for us what are the different components you need to put in place to kind of get to where you wanna go? Mm-hmm. If you think about the industry, one of the things that we did back when we moved from analog to digital is we seeded most of the digital capability to the supply base. They control the software on the modules. We all saw that come through significantly during COVID when we wanted to switch out chips in some of the modules that we had. It could be a wiper washer module or, you know, a window control module, you name it. The software was controlled at the supply base. The software is pretty much common across many OEMs. It is in the module. You could not make the change. Whereas those that had their own electrical architecture where they controlled the software with a central compute, they were able to change that. It is controlling the software on the modules. It's having a central compute, distributed electrical architecture. You need to control all of that. Over time, we'll control more of the modules on the vehicle. We'll do that based on, you know, a centralized compute. We'll have the digital experience within the cockpit, which will be software generated by us, and it will be our experience that we'll curate. When it comes to commercial vehicles, we'll have the type of productivity software that will be important for them. Telematics, fleet management, security, connecting and engaging, those types of things. Those are the areas that we're building off from a software standpoint that are gonna be important for the development of those capabilities over time. In Ford Plus, you talked a lot about the recurring potential of software revenues across the different aspects of the business. How much of that, or where are you today, and how much can you do in the current setup of the cars and the technology? They're becoming more and more capable. As I said, we have 675,000 paid subscriptions. The capability of the software in the commercial offerings is improving. One of the advantages that we have, if you think about fleet management, telematics, is that because we have control over the entire vehicle, we can do things with our software in the commercial space that others can't. We can provide the ability to turn on the vehicle, turn off the vehicle. We can provide the ability to adjust acceleration, right, and your ability in the way you drive the vehicle. There are a lot of things that we can do in controlling the vehicle that the third parties can't that gives us a competitive advantage and improves productivity for our commercial customers. That is something that they're finding is creative and additive, which we believe over time will allow us to capture a larger percentage of garage with the fleets because many of the fleets are mixed fleets. Through the competitive advantage we would have with the software, the types of things we can do to control the vehicle to improve productivity, with an end-to-end solution, that will drive not only software revenues, but it will also drive a higher attach rate share of garage. Have you seen any good examples of recurring software on the consumer side, not just a little bit but substantial? Yeah. So we're starting to, you know, BlueCruise is one. We have 370 million miles. It's growing. It's an L2 offering. You know, we're working on our L3 offering. That's probably on the retail side, the largest software offering that we have. We're also starting to see a pull through from the commercial side into the retail side of things that we think the customer is really starting to understand that there's value in that. Security is one example where the vehicle can be used, you know, from a secure standpoint to prevent theft. You know, we're developing the capability where you can leverage the cameras on the vehicle to monitor surroundings and to understand what's happening. Security is an important element not only for commercial customers but for retail customers. We're starting to see some traction gain in that space as well. Connect and engage, we're starting to see some examples of growth there on the retail side. We've just brought in a new leader of the integrated services group that is really focused in on those features that are going to resonate and build out from a retail side. Getting started in commercial, really ramping that up and growing. We're starting to see some pull through on the retail side outside of driver-assist technologies with BlueCruise. I think there will be more to come over the next 12-24 months about those services that are going to be growing. How do you think about those software services strategically? Because for a lot of features that OEMs have put into cars in the past decades, there's been a large degree of commoditization, from power windows down to the navigation system. Is that something you expect on the software side as well? Yeah. I think that's gonna continue to happen. I don't think it's gonna unfold differently than that. You're gonna have to keep innovating and be out front. Mm-hmm. That's gonna be the key. What are the pieces within Ford that give you confidence that you'll out-innovate the competitive landscape? Yeah. I think that one of the things is, we have a strong team. You know, Doug, who's come from probably one of the best out there, that's the integration of software and hardware. I think that we have a strong team. We're building, even continuing to build that team out that are they're attuned to the customers and understanding that space. I also think that we're staying very close to those that are leading in this space. You know, we're not being precious about, or, you know, conservative about the fact that we're not the best in this space. The industry traditionally hasn't been the best. We need to learn from other industries, and we need to learn from those that are doing it well. China is cutting edge. They've been a digital society much longer than we have. They've been innovating in the space within the vehicle and the in-vehicle experience. We're looking at them to learn as well. I think it's that curiosity that we have that the space could be meaningful and that innovation's gonna be key and speed to market's gonna be key. Those are the types of things that we're putting in place with the right team to be able to do that. I think we're building that out. In the past, we've talked about service revenues being able to offset some of the cyclicality and pushing some of the revenues into a less cyclical business with a higher GP. If it's gonna be commoditized in the long term, that will require the industry to kind of shift the way you pay for a car to some degree. Otherwise, if it all collapses back to the purchase price of the car, we're back to where we started. Mm-hmm. Do you see some recognition in the industry that that is a direction other people will wanna go to and will reach an equilibrium where there's maybe less of a focus on the initial sale of the car and more on the kind of services that happen during the life cycle? Is that something that really helps with cyclicality in the end? I think eventually we're going to get across the industry different models of vehicle ownership. I don't think that's going to be in the next five years or so. I think it's further out. I think it's gonna take some time for us to get there. The capability of the vehicles, the capability of the software, you know, I think it's probably more likely with EVs than it is with internal combustion vehicles. Eventually, I think that there will be new ownership models that will be more of an ability to leverage the vehicle based on a time-based ownership. Mm-hmm. How How long will it take you to get to that central compute that kind of seems to be somewhat of a nexus between the now and the future on software? We're right now, we're doing it over time. We've increased our capabilities of our vehicles today. You know, OTA updates have been growing. Over-the-air updates have been growing. The capability of that, that system has been growing. I think you'll see a significant step function forward when we launch our advanced EV from the California team in 2027. That's when you'll see a step function change for us. If you look at some of the leaders in China, also Tesla, there's a lot of focus on what I'd call navigation on autopilot, going from A to B, not autonomous but well-supported by your car and basically becoming a supervisor more than a driver. How far do you think that is away for Ford? I mean, from BlueCruise standpoint, we have the highest-rated driver-assist technology today. If you talk in L3, which is hands off, eyes off, I think we're in a pretty good position on that technology. L4, I think, is another bet. I don't know, you know, L4 has been developing for, what, the last 10- 15 years. It always seems that it's a year away from being ready to go. It just hasn't gotten there. We are watching that space very carefully with our Latitude team. We're evaluating every one of the L4 systems that's out there and understanding the progression they're making, the safety around each of those systems, the capabilities, and what we think that inflection point's gonna be where we really do believe that it's getting to the point where you're gonna be able to launch that type of technology at scale. Even before that, I mean, if we follow the strain of Argo and then your development of ADAS, I would not even say fully L3, but maybe hands off, eyes on. I get in my Ford, I press a button, and that is it for the next 20 minutes. The car kind of backs out of the driveway, goes down wherever it needs to go, and pulls into the destination. I think it's gonna come through domains, you know, over time. Right now on highway, divided highway, we're hands off, eyes on. You know, on-ramp to off-ramp, you know, potentially will be the next step. We're building that out. Eventually, we'll get to the point where, you know, you'll be able to do that through the whole drive cycle that you have. Mm-hmm. That's gonna develop. I think you're gonna get to the point where potentially there's L3 technology developing at the same time where it's hands off, eyes off on divided highway. That'll continue to develop. As it becomes the earlier technology, it'll start to commoditize, and it'll start to be like you just mentioned, other technologies that we've had on the vehicle like power windows, etc., where it becomes an ante. It's expected. It's gonna be part of it like just regular cruise control was. Those are gonna continue to develop. I think we're on the edge of that. I think we're not behind anybody else. BlueCruise is, I think, a proof point to that. As that starts to come out, no timeframe's been announced, but we're gonna continue to develop that and continue to expand the domain. Mm-hmm. If you think about your software spend today, how much of that is already recouped by recurring revenues? How much is a true invest kind of? How does that balance change over the next couple of years in your mind? We're still in the invest mode for sure. As we launch the next generation of architecture, then we'll start to really ramp up the software and be able to recoup the investment that we've made on that. That's a long-term investment. I think it's something that, you know, is gonna continue to build. If you think about the industry itself, one of the reasons why our capital efficiency or our returns are low is because we spend billions of dollars creating the hardware, and then we capture a very small percentage of the TAM generated off of that hardware. Now with the software services, physical services have been there. We used to do a much better job of capturing that. I believe that that's gonna allow us to capture a larger percentage of the TAM generated from the vehicles, get a direct relationship with the customers, bring them into service more, grow that part of the business as well. That is an accretive action that's gonna happen across time, and it's gonna continue to build. That is one of the things that we need to do as an industry and as a business is we need to capture more of the TAM generated off the vehicles. The intelligent vehicle, the software-defined vehicle's gonna allow us to do that. Mm-hmm. Maybe moving on a little bit to a broader view, other industries, especially asset-heavy industries, low margin, rising costs, more challenges. Mm-hmm. Have often turned to consolidation. Mm-hmm. Maybe a two-part question. Number one, why hasn't that already happened? What has been preventing the industry from consolidating more? Yeah. I think you're right. If you look at any other industry with this makeup, they would've consolidated quite a while ago. I think there's a lot of factors that limit that consolidation. It's complex. It's capital-intensive. You have a lot of players that you need to satisfy from dealers and unions. You have a lot of the companies have a lot of issues that need to be worked through. You have antitrust concerns in certain segments of the business that would limit that ability to consolidate. I think there's a lot of factors that have done that. The way we're thinking about it is consolidation probability is low. I don't think you're gonna see a lot of consolidation, pure consolidation. I think some companies aren't gonna make it. I think that's just the nature of how things are gonna shake out. What I do think there's an opportunity for is partnerships and alliances where we can work together on the investment that has to take place on many of these developing areas and that we all don't have to do it on our own. We can do that in partnership. That would reduce capital efficiency. It would increase speed to market. It would allow us then to bring some of this forward from an industry standpoint when it comes to electrical architectures, software-defined vehicles, even platform sharing. I think that you're gonna see more of that happen over time versus consolidation, just because of all the constraints that happen from a consolidation standpoint across this industry. It's a tough thing to do. The industry has always been under pressure. Mm-hmm. I mean, if we go back 20 years, I'm pretty sure the Bernstein reports would still say it's margin challenge, low growth, and difficult. Yet this alliance and partnership structure hasn't really worked out that well. There are very few examples in global autos where there's been a big alliance and a big partnership. What do you think you need to inject into those discussions to come to a different outcome? We've seen some that have worked well, and we've seen some that, you know, have died over time. I'm not so sure that the partnerships or alliances that have gone away over time aren't necessarily, it's not necessarily a bad thing. Some of them are more transactional. Some of them are more long-lasting. I mean, we've had a partnership with Autoliv for over 25 years that's been really strong. I think we need to look at it with the reality of is this short-term? Is this long-term? Are we complementary in different areas around the world? I think the other thing is it's just gonna be the necessity to allow us to get done what we need to get done with the speed that's changing in this industry. You're not gonna be able to do it all on your own at the pace that it needs to take place and then the capital that's gonna be required. You know, one of the fundamental shifts that's happened in the industry, if you go back and look at the amount of capital that the Western OEMs have profit they have taken out of China over the last 10- 12 years is $80+ billion. Mm-hmm. That's evaporating. That's down, what, 40%-50% over the last three years. That capital funded a lot of the investment that's happened in the industry. With that being gone, everybody's not gonna be able to do this on their own. There are gonna be these forcing factors that are gonna push us into figuring out how we continue to stay competitive and that those that do not are gonna be the ones that are gonna have a hard time keeping up. What would be some of the ideas, either horizontal or vertically, where you say that could be something you'd be interested in? It could be anywhere from things that do not differentiate you versus your competitors. There could be anywhere from sharing componentry, motors, on battery-electric vehicles. I think batteries is a good example where many of us have set up joint ventures and partnerships on batteries where those are gonna commoditize over time. I do not think they are gonna be differentiated. I think powertrains, ICE powertrains over time are going to need to consolidate, and they are not gonna be differentiated. I do not think that consumers really think about powertrains the way, you know, they did 30 years ago where it defined what a vehicle was, you know, the horsepower, you know, the displacement, the torque, and everything about the vehicle. I think a lot of that is gone. Does everybody need to develop the next four-cylinder and six-cylinder as that arc comes? When it comes to technologies from a standpoint of multi-energy, so HEVs, PHEVs, eREVs, does everybody need to develop that? Or are there gonna be a few that have that where you'd partnership and you'd leverage their capacity? It could come down to where you have platforms where a vehicle platform, and then you're just putting a top hat on somebody else's platform because there's scale opportunities. It could come down to as certain emerging players wanna grow globally that they don't invest in their own manufacturing facilities, and you share a platform in those facilities. I think there's gonna be a lot of change that's gonna happen over time relative to how we think about how precious things are that we've felt were precious in the past. I think what it's gonna come down to is the brand and your relationship with your customers and then the services and the experiences that you give them. Those are gonna be the differentiating elements going forward versus the hardware. Let's take plug-ins because you've got quite an ace in the hole with your plug-in technology. Mm-hmm. It might be difficult for any other OEM to say, "Yes, I'm buying the plug-in technology from Ford." Would you be willing to kind of split that out into something else, to make that happen? I think that, if there was a partnership where they thought that our plug-in and hybrid technology was something that was, that they wanted and we could figure out that there was a win for us with that company, we'd be willing to do that. Would we split it out into a separate business unit and sell it? I don't see why that wouldn't be an opportunity down the road for any of the OEMs. You could think about that from electrical architectures, right, and software-enabled vehicles. You're gonna have three electrical architectures around the world. You're gonna have the one in China. You're gonna have one in the West. And then you're gonna have one in emerging markets because of cost. In China, they have the tech companies are heavily engaged. Huawei, Xiaomi, they're heavily engaged. In the West, they're not, right? Could it be that, and you're starting to see a little bit of this, that those companies that have developed the electrical architectures, that they're willing to sell that electrical architecture to other OEMs because not everybody can develop that? I think you're already starting to see that with some of the arrangements that have been made out there. I think you're gonna start to see more of these types of things over time happen. What does it take internally to kind of jump over that ledge? Because, as you said, we've seen some movements out of necessity or desperation. Mm-hmm. To address shortages in electrical architecture. I think the majority of OEMs out there are still convinced they're gonna build their own system at this point in time. How do you short-circuit this to have a fast realization, whether Ford or if you, you know, any OEM says, "Look, I'm gonna make this or I'm not gonna make this"? It seems that a lot of people are still trying, but the industry seems to depend on that realization happening rather sooner than later. Yeah. What I can say is that there are those working on it. You know, I think that the realities of the industry are just really starting to take shape across the industry. I think that's gonna drive and be the catalyst for that. I don't think there's anything that's happening that's, you know, material across the industry right now that you're hearing about or is on the verge of happening. I think we're starting to gain momentum. I think the willingness to consider and the openness around potentially needing to do this, I'm starting to see more traction around that. I'm starting to see more folks talking about the fact that there is so much to do and things are changing so fast that there's gonna need to be a different approach. Another element you talked about is when you gain more control of the software, you gain more control of the modules and kind of that's a little bit more vertical integration in terms of what is it that you are actually designing for the car. How does that change the relationship with the suppliers? Dramatically. If you look at the relationship with the suppliers, on the advanced EV team, it's a whole different relationship. You know, a lot of what's happening in the industry, with the traditional OEMs and internal combustion, it's a lot of project management where the suppliers are owning the engineering and such. Whereas in the advanced electrification team, they're owning the engineering and they're working directly with the supply base on a real-time basis for design changes. That's allowing us to not over-design the vehicle. That's allowing us to really understand what the cost structure of that part should be, to work with that supplier on what a fair margin would be for them to produce that part, and then optimize the cost structure. I think the shift that's going to happen with the OEMs, I think there's going to be an equal or greater shift that's gonna happen in the supply base. Right. Especially with the Chinese. If you think about the Chinese, they have a 30% cost advantage in China. They understand that they, that cost advantage as they move outside of China, you know, cannot be sustained right now. What they are doing, what some of them are doing is they are working to establish a lower-cost supply base outside of China. Is it going to be 30%? Probably not. Whichever Chinese OEM, whichever one of them can create that supply base or rebuild that supply base outside of China with the lowest cost, let's say 20% lower than everybody else, 10% higher than China, they will be the winners. I do know that several of them are trying to establish that supply base outside of China. What is that going to do to the overall footprint of the supply base? If that happens, then those suppliers are gonna be open up for business with other OEMs. Potentially other OEMs would look to help certain Chinese OEMs develop that supply base and develop their ability to operate around the world. How do you think that interplays with the next couple of years in the U.S.? I don't think that it's going to play in the U.S. I think, you know, I don't think that the, honestly, I'm not, I'm not sure that the Chinese are looking to come to the U.S. They know what the environment is right now. We basically, you know, closed it down to them coming into the U.S. I think they're gonna continue to work on Asia. They're gonna continue to work on Europe. I think they're gonna continue to be a force to be reckoned with given their speed, their cost structure, their nimbleness, and their ability to iterate very quickly. I think they're gonna continue to build out their capabilities elsewhere around the world. Eventually, when, you know, they've established themselves, they'll be looking to come to the U.S. Is that 5 years, 10 years down the road? I don't know. Your guess is as good as mine. Eventually, they'll come just like the Japanese did and the Koreans did. Consumers will want the best product. You know, they're gonna want the best product. They're not gonna say, "No, I'm not gonna buy that because it's from X, Y, Z." If it's the lowest cost, highest quality, best features, we're gonna want it. That's eventually gonna happen. If we zoom out and kind of tie this together, what does success look like for Ford in three years' time in 2027 and 2028? I think it's, we're approaching best in class in cost and quality. So we fixed that, checked that box, and we fixed that issue that we've had that we've talked about. We haven't been shy about that. Ford Pro is gonna continue to be a growth engine for the company. You're gonna see a higher attach on software services. You're gonna see our ARPUs growing, and you're gonna see the number of paid software subscriptions growing. We're gonna see that being over 20% of Pro's profits. You're gonna see between software and services, it's gonna be 20, over 20% of Pro's profits. You're gonna see the launch of the next-generation electric vehicles out of the advanced development team in California. And they're gonna be scaling and be, they'll be successful. You'll see the continued development of our industrial system around speed and capability. You'll see that we'll have partnerships and alliances that we don't have today that are gonna enable our ability to move quicker, be more capital-efficient. You're going to see the fact that, from a competitive standpoint, our hybrid technologies are gonna continue to lead and allow us to have that competitive advantage of customer choice from a powertrain standpoint. I think what you're gonna see is the pieces that we're developing now. You're gonna see the traction of that. You're gonna see a company that has higher growth, higher margins, more capital-efficient, and more durable, less cyclical because of the different types of revenue streams and profit streams that we're developing. That's what success is in three to five years. What would be your response to investors as, "But why should I then invest today? I think that, from a standpoint of Ford, you're seeing momentum, which is the biggest unlock in the near term around cost and quality. You're seeing that there's potential, still a ton of potential that we have around our commercial business, and that's growing with strong margins. You're stepping back, and you're looking at a company that is being very thoughtful about our capital allocation and capital efficiency, and we're laying down the bets for that future. I think what you're finding is that, from a brand standpoint, we're still competitive around the world. We're meaning, we mean something. We're taking the Chinese on, and we're starting to compete with them, in a global standpoint. I think there's a lot of unlock for us in the near term, especially around cost and quality. You're starting to see that traction. It's the third quarter in a row where we've improved our cost structure. Our quality is getting better. You've seen those quality improvements. Third-party, you know, JD Power and such, those have shown that improvement. That is gonna continue to accelerate. That is gonna allow us to continue to have strong margins in the near term. As we start to really gain traction on the other areas I talked about, there's upside. Excellent. I think that's a great note to leave it on. John, thanks very much for being here today. Thanks very much, John Lawler.