To make EVs accessible to the masses, Ford CEO Jim Farley is urging the company to follow Henry Ford’s pioneering approach by manufacturing affordable electric vehicles (EVs) on a large scale, just as he did with the Model T. Despite the exhaustion involved, the key challenge lies in achieving a profitable outcome. As China’s bold bet on electric vehicles (EVs) has yielded impressive dividends thus far, Ford must now confront the ultimate competitor in BYD.
Ford strikes to inexpensive EVs
Farley asserts that their future electric vehicles will not only be valuable but also affordable for the majority of consumers.
Ford is poised to unleash a slew of electric vehicles that will be “aggressive” and perfectly integrated into its business model, according to Farley. For now, the automaker sees China as the source of this upcoming wave of EVs.
Following China’s strategic bet on electric vehicles, which has yielded significant returns so far, Ford is seeking to replicate some of that success in the US market.
Ford has been secretly developing a smaller electric vehicle (EV) platform for more affordable models since earlier this year, according to Farley. Ford may be putting off its more substantial, electrically-powered three-row SUV as it pivots towards smaller, more accessible EV options.
Ford assembled a specialized team of elite electric vehicle engineers from around the world to craft its cutting-edge, all-new platform.
As General Motors navigates a significant transformation, its staff has become increasingly populated by seasoned talent from innovative companies like Tesla and Apple, boasting over 120 years of collective experience in the automotive industry.
Farley noted that they’re developing a novel approach, a unique offering at a competitive price point, featuring a significantly reduced battery size and innovative chemistry.
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What’s behind Ford’s sudden shift in plans? Despite their popularity, Farley highlighted the drawbacks of NCM batteries, noting that those containing cobalt, lithium, and nickel are both expensive and cumbersome due to their substantial weight. The estimated cost of the F-150 Lightning’s battery ranges from $30,000 to $40,000.
Ford’s CEO announced that the company will pioneer investment in affordable battery production at its Marshall, Michigan facility. According to Farley, this would be the initial instance where they take it directly to US clients, potentially establishing themselves as a go-to provider in that market.
Ford is collaborating with Contemporary Amperex Technology (CATL), a global leader in battery technology, to acquire intellectual properties (IPs) and develop its own batteries, following the approach taken by Farley. Ford is investing heavily in Marshall, Tennessee, to create a state-of-the-art electric vehicle manufacturing facility.
Ford aims to revive its hybrid offerings with renewed emphasis, a strategy born from the reality that electric vehicle (EV) demand has been slower than anticipated, prompting a pivot back towards the environmentally friendly yet tried-and-tested hybrid technology of decades past.
Following its adoption of the Tesla Supercharger network early this year, Ford CEO Jim Farley revealed that the company has garnered around 100,000 applications. To date, Ford has dispatched a modest number of NACS adapters, with the tally in the low thousands.
Ford reportedly appreciates collaborating with Tesla, finding that granting access to drivers is a highly effective means of transferring. Ford will need to procure approximately 90,000 additional adapters. Following a conversation with Elon on the previous night, Farley hinted that what was discussed might soon be shared publicly.
The relationship between Ford and Tesla is characterized by mutual respect, as they are the leading electric vehicle (EV) manufacturers in the United States. While sharing Farley’s optimism, the relationship is indeed an ongoing competition. The entire interview is available to view below.
Electrek’s Take
Farley successfully fielded queries on why China excels in electric vehicles, citing the government’s swift support and competitive pressures as key drivers of its success.
China’s authorities swiftly embraced electric vehicle (EV) technology, offering substantial tax breaks, generous subsidies, and significant investments in companies such as Contemporary Amperex Technology Co. Limited (CATL). China is poised to dominate the electric vehicle landscape, with forecasted sales of over 45% of the total automotive market this year, translating to approximately 10 million units as the world’s leading EV market.
Meanwhile, BYD, China’s leading electric vehicle manufacturer, achieved its second-best monthly revenue performance on record as demand for electric cars continues to soar.
In a major milestone, BYD delivered 146,395 electric vehicles in its latest quarter, representing a year-over-year increase of 22 percent and a 9 percent rise compared to the preceding three months. As of 2022, BYD ceased production of gasoline-powered vehicles, having opted instead to concentrate on the development and manufacture of electrically powered vehicles.
As the leading manufacturer of rechargeable batteries, BYD has secured significant value benefits. Following the release of its “Honor” series of more affordable fashion-inspired electric vehicles, BYD’s entry-level Seagull starts at a remarkably low price point of just $9,700 (69,800 yuan) in China. Initially dubbed the BYD Seagull, a moniker that aptly foreshadowed its exceptional performance, with “fairly rattling good” being a prophetic nod to the vehicle’s superior technology.
Can Ford’s electrification strategy effectively counterbalance declining internal combustion engine demand amidst intensifying competition from BYD and other Chinese EV manufacturers? Within the United States, Tesla’s market dominance is evident. What do you think lies ahead?
