As the leader of Ford, one of the oldest and most iconic automobile manufacturers in the world, with a rich history spanning over 120 years, Ford CEO Jim Farley plays a crucial role in shaping the company’s future direction. Ford’s CEO, Farley, emphasized that smaller electric vehicles (EVs) are “tremendously essential” for modern society, highlighting their importance. Meanwhile, he acknowledged Americans’ fondness for larger, more powerful “monster cars”.
While Ford is renowned for its robust, imposing vans and SUVs, its trajectory might actually pivot towards something surprisingly lightweight. Ford’s CEO has reaffirmed the company’s commitment to pursuing a “profound transformation”, driven by its intention to prioritize the development of smaller, more valuable electric vehicles.
At the recent Aspen Concepts Pageant, Ford’s CEO gushed about their fascination with the behemoth vehicles. Though Farley concurred, saying “I really like them too”, he nonetheless recognized the gravity of their predicament, stemming directly from their significant weight issue.
Ford’s CEO noted, “It’s time for us to rekindle our passion for smaller vehicles.” It’s crucially important for our society and for EV adoption.
Ford confirms its commitment to electrification by accelerating development of a new, compact electric vehicle (EV) platform, following CEO Jim Farley’s announcement earlier this year that the company had been working on a secretive project aimed at producing smaller, affordable EVs.
Ford is expected to introduce an electric vehicle priced around $30,000 by 2027. According to Farley’s assertion, it would seem a prudent investment.
Ford is abandoning its reputation for building monstrous vehicles in favor of electric powertrains.
Ford is assembling a team comprising some of the most accomplished EV engineers to bring its electric vehicle concept to fruition. Ford has lured top talent from rival companies, including Tesla, Rivian, Apple, and Lucid, to spearhead the development of its new platform.
During the interview, Farley emphasized that achieving a meaningful electric vehicle (EV) requires a transformative shift.
Ford’s pivot stems from its decision to delay a larger three-row electric SUV to focus on smaller EVs that could generate significant revenue streams. Ford is reportedly poised to accelerate its next-generation electric vehicle (EV) pickup, the T3, with a potential launch date slipping to 2026.
Farley stated categorically that enormous electric vehicles (EVs) will certainly not generate revenue. “The battery itself costs $50,000,” he noted, referencing larger-duty vehicles such as Ford’s Super Duty models, which require extensive battery packs to support an impressive 500-mile range.”
As the global automotive landscape evolves, Ford is under pressure to transform its electric vehicle strategy by constructing profitable EVs within the next five years, a challenge mirrored by main Chinese automaker BYD’s expansion into new international markets.
Ford already faces stiff competition in the electric vehicle (EV) market, where existing rivals generate revenue from EV sales, expand their global presence, and establish robust supply chains.
What’s the fate of our electric vehicle ambitions if we fail to deliver meaningful models within the next five years? Are we retreating from global ambitions to focus solely on the North American market?
Ford lost a staggering $132,000 on every electric vehicle sold in its initial quarter, but CEO Jim Farley remains confident that Ford’s upcoming models will ultimately prove profitable.
Electrek’s Take
While Ford historically derives significant revenue from its large vehicles, such as vans and SUVs, Farley’s assertion holds merit. If Ford doesn’t keep pace with the global electric vehicle (EV) market, it risks shrinking its share of the industry.
As Ford derives approximately 98% of its revenue from the US market, it is crucial to consider the potential impact of low-cost, high-quality electric vehicles (EVs) from foreign manufacturers entering the US market. As foreign competitors like Hyundai and Kia continue to gain traction in the US market.
Kia and Hyundai are introducing compact, affordably priced electric vehicles (EVs) to global markets. The Kia EV6 has already garnered more than 10,000 pre-orders in its home market of South Korea, with a starting price tag of approximately $30,700 or KRW 42.08 million.
While most others are at a similar level. The Volvo EX30’s global rollout has commenced, with a targeted launch in select international markets, while its US debut remains postponed. General Motors announces that the $35,000 Chevrolet Equinox EV model is slated for availability in late 2023, with ordering opportunities opening soon.
Will Ford discover its market? By launching a range of smaller, more affordably priced electric vehicles, Farley is counting on this strategy to drive success.
