Ford’s CEO Jim Farley admitted he was humbled after tearing down the first Tesla and Chinese EVs. If it wants to compete globally, Ford can’t walk away from EVs altogether, so it’s planning to shake things up.
Ford can’t walk away from EVs, or it will lose to China
After taking apart a Tesla Model 3 and several electric vehicles from China for the first time, Farley said he was “very humbled” during a new episode of the Office Hours: Business Edition podcast.
The “shocking” revelation is what pushed Ford to overhaul its EV program. Ford is shifting its focus to smaller, more affordable EVs, which require smaller batteries and fewer materials.
Ford is promising its next-generation electric vehicles will be significantly more efficient and advanced than the current Mustang Mach-E and F-150 Lightning. Farley told host Monica Langley that the Mach-E had about 1.6 km of electrical wiring, which led to a larger battery.
Ford’s CEO has warned several times now that Chinese EV makers pose an “existential threat” to Western brands, including itself.
After flying a Xiaomi SU7 from Shanghai to Chicago last year and driving it around for a few months, Farley even said he didn’t want to give it up.
“EVs are exploding in China,” Ford’s CEO said on the podcast, adding the Chinese government had its “foot on the economic scale” to promote electric vehicles.
Although the US is facing headwinds with the $7,500 federal tax credit now expired and the Trump administration shifting policies, Farley admitted, “We can’t walk away from EVs, not just for the US, but if we want to be a global company, I’m not going to just cede that to the Chinese.”
Ford, like most automakers, is bracing for slower EV sales over the next few months. Farley said on the company’s third-quarter earnings call that he expects electric vehicles to account for just 5% of the US market in the near term.
The “EV market in the US is totally different than we thought,” Farley explained during the podcast, adding buyers are looking for more affordable options rather than the “$70-80,000” EV.
To stay competitive, Ford is betting on its new low-cost EV platform, the Ford Universal EV Platform, which the company says will help unlock more affordable electric cars.
The first vehicle Ford plans to launch on the platform is a midsize electric pickup, starting at around $30,000. It’s expected to arrive in 2027. Ford will use lower-cost LFP batteries licensed from China’s CATL. They will be manufactured at Ford’s new plant in Michigan.
According to Lisa Drake, Ford’s vice president of tech platform programs and EV systems, the company intends to match the cost structure of leading Chinese brands.
In the meantime, Ford has paused production of its current electric pickup, the F-150 Lightning. A new report from The Wall Street Journal claims it’s now considering scrapping the EV pickup altogether.
Source: Business Insider
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