Ford GC Tells Law Firms: In-House AI Adoption Outpaces Yours

Ford Motor Company's general counsel is issuing a pointed challenge to the legal industry: the automaker's internal AI capabilities have already surpassed what external law firms are delivering, and that gap threatens to reshape which work stays in-house versus goes to outside counsel.

Steven Croley, who serves as chief policy officer and general counsel at Ford, says the company now deploys AI agents across its entire legal practice, creating "entirely new legal service delivery models" that dramatically expand internal capacity. Meanwhile, traditional law firms appear slow to capitalize on AI's potential despite the technology's disruptive force.

Why it matters

This public critique from a Fortune 500 general counsel signals a fundamental power shift in corporate legal services. As in-house teams build sophisticated AI capabilities, they gain leverage to demand lower rates, faster innovation, or simply redirect work internally—potentially upending the economics that have sustained Big Law's growth for decades.

The New Competitive Landscape

Croley frames AI as a third "entrant" in legal services, one that competes directly with both external and in-house counsel. Large language models now handle complex research, advanced problem-solving, and sophisticated document composition at speeds and quality levels that challenge traditional service models.

The technology fundamentally decouples time from value, operating without billable hour constraints while scaling output without proportional cost increases. When properly directed, AI functions as what Croley calls a "super associate" and increasingly a "super partner"—amplifying capabilities for any team that deploys it effectively.

Ford's Expectations for Outside Counsel

The general counsel outlines three specific concerns about law firm AI adoption:

First, competition among external counsel to harness AI advantages has been "off to a slow start," particularly given the potential rewards for early movers in what Croley describes as a once-in-a-generation market reorientation.

Second, it remains unclear how AI investments translate to rate relief. Ford and other public companies continue seeing standard annual rate increases with little explanation of how higher fees reflect infrastructure investments in future AI efficiencies.

Third—and most pointedly—Ford's internal AI productivity currently exceeds what the company sees from external counsel. Croley suggests in-house teams may hold an inherent advantage through proximity to corporate clients and stronger motivation to manage costs.

Implications for Law Firms

Croley notes that smaller firms might gain ground in this transition. They can pivot quickly, restructure to integrate AI agents, and dramatically increase capacity without adding headcount. They're also less constrained by the pyramid economics underpinning Big Law's profit model.

Traditional advantages of large firms—economies of scale and one-stop legal services—may diminish in an AI-enabled market, according to the Ford executive.

Ford plans to expand relationships with external partners who innovate and deliver quickly while curtailing reliance on firms that lag behind. The company will continue investing in internal AI capabilities even as it solicits innovation from outside providers willing to demonstrate genuine productivity gains.

These details were first reported by Bloomberg Law, where Croley's commentary appeared as part of the publication's Legal Exchange Insights series.