Ford Motor Co. will open an electric vehicle development center in Long Beach, California, next year in a bid to attract and retain the engineering and software talent it needs to develop future EVs.

The 250,000-square-foot center will house up to 450 employees. Ford declined to disclose the investment in the location. It's an outgrowth of the Dearborn automaker's "skunkworks" group, a small team under the leadership of Tesla Inc. veteran Alan Clarke purposefully set apart in California to work without disruption. They're seeking to revolutionize the way Ford develops its vehicles with a new flexible platform that can offer EV models priced as low as $25,000. Accomplishing that will require adopting a new mindset and approach, experts said.

"We have to attract and retain the best key talent, and many of them have chosen to live in California," Clarke said this week during a Grow Long Beach presentation held by Mayor Rex Richardson. "Our strategy is to create hubs across the U.S. where we can attract the very best talent in electric vehicles, and we want to have a great connection for communities that people can live in. And we have to have proximity to restaurants and grocery stores and workout classes and facilities that are a draw for people to come into the office.

"It's also really important for us to have feeder university programs and jobs programs so that we can have the right engineers, designers and technicians in the same place."

Affordability in comparison to gas-powered vehicles has been one of the largest challenges for consumers in adopting alternative powertrains. Ford hasn't said when vehicles using the platform will launch except that it will take a couple of years. Analysts expect it could be as early as late 2026 or in 2027.

The new center will contribute to a major product line at Ford, Doug Field, the automaker's chief EV, digital and design officer, said during the event: "We have a project that we really want to make big."

It's not just Ford that has gone to California to find the talent it needs. Many other automakers have some kind of presence in the Golden State. Tesla Inc. grew up there, and Rivian Automotive Inc. moved its headquarters there after getting its start in Plymouth. General Motors Co. last month opened a 50,000-square-foot Mountain View Technical Center in Silicon Valley to support software development. GM CEO Mary Barra said the company will go where the talent is.

Detroit's automakers aren't abandoning Metro Detroit, but they are casting a wider net to ensure they have the people with the skills they need to compete in a transforming marketplace, particularly from tech and EV startups. Clarke said employees at the Long Beach center will work closely with Ford's industrial team mostly in Dearborn and in other hubs throughout the United States, including Greenfield Labs in Palo Alto, California. Ford is seeking to ensure its has the facilities that will attract the engineers, designers and innovators it needs here, too.

Construction of its new product development center in Dearborn expected to open next year is ongoing. Earlier this month, the automaker showed off to the public Michigan Central Station following a six-year renovation that is anchoring a nearly $1 billion mobility innovation campus in Detroit's Corktown. The station is expected to hold 2,500 Ford employees by 2028, mostly from its Model e EV division and software services teams.

Ford Executive Chairman Bill Ford has discussed how his plans for the urban district came from the need of the company to attract engineer graduates out of the University of Michigan and other colleges, software developers and the industry's visionary leaders.

These kind of projects are good, but if Detroit still isn't a talent magnet city with vibrant, walkable neighborhoods and accessible transit and the state isn't producing the kind of individuals with the skills its heritage industry needs, the impact of these major investments will be limited, said Lou Glazer, president of Michigan Future Inc., a nonpartisan think tank focused on the economic well-being of Michigan.

"The state's predominant vision still is focused on attracting manufacturing, particularly at automotive plants," he said. "You don't need college degrees for that. We are not making a priority out of four-year degrees and creating particularly vibrant central cities that are essential to retaining and attracting recent college graduates. It has not been a priority."

Michigan remains a leader in automotive engineering, design, testing and manufacturing, attracting research-and-development centers from EV startups Lucid Group Inc. and Volkswagen AG-backed Scout Motors Inc. But it's critical it grows that ecosystem to continue to compete for industry investments, said Glenn Stevens, executive director of the Detroit Regional Chamber's MichAuto mobility arm, which has several long-term projects focused on attracting tech talent.

"California normally ranks as No. 1, 2 or 3 for software jobs and pay; Michigan is well down the pack, usually in the mid-20s," he said. "It's such a global competitive space and a huge juggernaut that did not exist that long ago. They have to deploy their resources for product development and vehicle development wherever the talent is in the world."

Richardson, the Long Beach mayor, emphasized an intentional approach in the kind of businesses in which the city is investing.

"We don't have to chase every job and compete with Texas for every $15-an-hour job," he said during the presentation. "Let's take our time, be thoughtful. Let's bring in the jobs that are advanced manufacturing, engineering, even welding from Long Beach City College starts at 45 bucks an hour. These are jobs that don't even require a degree, but if you build the right mix of advanced manufacturing, of electric vehicle development, you can create a really special cluster ...

"We don't have to compete with every city. ... We're going after these clusters: the Denvers, the Phoenix. We don't have to have this competition with Texas. We have something very special, and people want to be here because of the balance of both talent and quality of place here in Long Beach."

Disruptive without disruption

Work to put together Ford's skunkworks team began two years ago, according to executives, when they realized the sweet spot in the EV market should be a low-cost offering. The name is borrowed from defense contractor Lockheed Martin Corp.'s Advanced Development Programs that seek to define the next-generation of technology in its industry and create "disruptive solutions," according to its website.

Ford declined a request from The Detroit News for an interview with Clarke or another member of the skunkworks team for this story, but executives have routinely shared how key initiative is to Ford's electrification journey and strategy for competing with potentially low-cost EVs from China.

Bill Ford told The Detroit News in a recent interview that when doing something different — like skunkworks is — isolation can be beneficial for getting the work done quickly, secretively and creatively.

"Particularly as they're starting off, there's something to be said for separation," he said. "We're a big company that people like to poke around. I think (Ford CEO) Jim (Farley) really wanted them to be left alone. It's probably no more complicated than that. Now, at some point, a lot of what they're doing will have to be integrated back into bigger Ford, and you'll start to see them coming together. But for now, particularly in the early, early days, it was important for them to not be bothered by curious Ford visitors. Even Jim and I had to sort of rein ourselves in from going out there all the time, because we don't want to distract them."

It's far from the first time Ford has taken the approach of isolating a small group when it's seeking to do something different. Farley told The News that the all-electric Mustang Mach-E SUV, Ford's first mass-market EV, came from "Team Edison" that had worked in a building called The Factory in Corktown even before the automaker bought the train station.

"We purposely moved them away from Dearborn to start the EV business, and so was our whole mobility business," Farley said.

Damian Porcari, the former director of licensing at Ford Global Technologies LLC that manages the automaker's intellectual property, previously worked on a skunkworks-style team for the 2015 Mustang GT. Its members isolated in the basement of the company's product development center.

"Large institutions are not the most helpful ways of generating new ideas, especially when they've been doing the same thing for 100-plus years," said Porcari, who also is the former director in the Midwest of the U.S. Patent and Trademark Office. "You get way more noes than yeses."

In that way, privacy is more than just keeping the details under lock from the competition or the public, but even from finance and legal teams, he said: "Very few cars owe their existence to lawyers."

That's the contrast between traditional manufacturers and the startup automakers that have taken over the world's largest automotive market in China, said Jeff Stout, executive director of global innovation at Shanghai-based Yanfeng International Auto Tech Co. Ltd. The supplier has found domestic Chinese automakers are more willing to give innovations a try and do so more quickly, allowing Yanfeng to roll out new technologies and obtain the data and performance results it needs to pitch the product to other customers.

"You don't have the same kind of bureaucracy," Stout said.

Need for agility

Chief Financial Officer John Lawler has compared the skunkworks approach to EV development to that of the Chinese and how quickly manufacturers there can launch new models. It emphasizes systems engineering over integrating others' contributions and is an "agile" process that differs from a traditional "waterfall" procedure.

That describes development where everything is designed to hit a certain deadline for production to start or cascade altogether, said Sam Abuelsamid, principal e-mobility analyst at market research firm Guidehouse Inc. The new way of thinking involves new features with regular frequency. Thanks to over-the-air updates, connected vehicles on the road can receive upgrades to their software and new services. But Chinese EV brands even are updating their vehicle hardware much sooner — every 18 to 24 months compared to every four or five years for traditional vehicle refreshes.

"You make changes as soon as they're ready to reduce costs and create more component integration," Abuelsamid said. "When Ford developed the Mach-E, it wanted to get to market quickly, so it used off-the-shelf components from other vehicles."

That, he said, helped speed the process but as a result, the Mach-E that hit dealerships more than three years ago doesn't have the most cost-efficient design.

"It was able to get to market quickly, but it's a little more complex, there are more components, and it’s also a little heavier," Abuelsamid said. "It's a little bit more costly."

Transformational thinking is something that could benefit Ford and help to reduce the approximately $17,000 cost difference between the average U.S. EV and Teslas, said John Murphy, Bank of America Corp. analyst. The challenge with the skunkworks goal, though, he said, is that most Americans prefer larger SUVs and trucks over a smaller vehicle likely to be offered on a platform as low as $25,000.

"The general direction of that makes sense," Murphy said last week during an Automotive Press Association event. "That will be a vehicle that may be much more appropriate for emerging markets and international markets as opposed to the U.S. However, the lessons learned from that and sort of the lessons from that may actually help with mid- and larger vehicles here in the U.S."

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