A Ford electric pickup truck is displayed during the Electrify Expo DC in Washington, DC, on July 23, 2023.
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Ford engine expects to introduce a $30,000 all-electric vehicle that will be profitable in about two and a half years, CEO Jim Farley said Friday during the Aspen Ideas Festival.
Farley did not reveal many other details about the vehicle, which is being developed by a Ford “skunkworks” team, but said its main competitors are expected to be Chinese automakers such as Please tell me and a long-awaited entry-level car from the US electric vehicle leader. tesla.
Farley said Ford is focusing first on smaller electric vehicles rather than larger all-electric trucks and SUVs, which have historically been gasoline-powered profit drivers for the company, because such vehicles are “never going to make money.”
“We have to make a radical change like [automaker] “To get to a profitable electric vehicle, the first thing we have to do is put all of our capital into smaller, more affordable electric vehicles,” Farley said during an interview with CNBC's Julia Boorstin. “That's the duty cycle that we've found really matches up. These big, huge electric vehicles are never going to make money. The battery costs $50,000… Batteries will never be affordable.”
A Ford spokesperson later clarified that Farley was referring to large vehicles like the company's Super Duty models or vehicles that require huge battery packs to achieve a significant 500-mile range. He wasn't referring to vehicles like Ford's current F-150 Lightning electric pickup truck or next-generation electric vehicles.
Earlier this year, Ford said it would postpone production of a large three-row SUV at a plant in Canada until 2027 from its initial plan of 2025. It also postponed a next-generation pickup truck, codenamed “T3,” from end of 2025 to 2026.
Farley reiterated Friday that Ford's next-generation vehicles will be profitable.
He also said Americans need to “fall back in love” with small cars instead of larger ones, a surprising statement considering that most of Ford's profits come from trucks and considering that American automakers have historically had trouble make money with small models.
“We have to start falling back in love with smaller vehicles. It's so important for our society and for the adoption of electric vehicles,” Farley said Friday. “We're in love with these monster vehicles, and I love them too, but the main issue is the weight.”
Ford's electric vehicle unit lost $1.32 billion in the first quarter of this year on wholesale sales of 10,000 vehicles. While the unit also includes EV-related businesses such as software, those losses amount to a loss of $132,000 for each vehicle sold by the unit.
Farley said it is crucial for Ford to make profitable electric vehicles in the next five years as Chinese automakers continue to expand globally.
“If we can't make money on electric vehicles, we have competitors who have the largest market in the world, who already dominate globally and who are already setting up their supply chain around the world,” he said. “And if we don't make profitable electric vehicles in the next five years, what's the future? We're just going to be reduced to North America.”
