Ford CEO Jim Farley says that Chinese car companies are the Blue Oval’s biggest rivals in the electric vehicle market, and not GM or Toyota, according to Automotive News, who quoted Farley after he spoke at the Morgan Stanley Sustainable Finance Summit.
"We see the Chinese as the main competitor, not GM or Toyota," Ford’s CEO said, adding that “The Chinese are going to be the powerhouse.”
Admittedly, comparing yourself to Toyota in the EV sector isn’t exactly a tall order, as the Japanese carmaker only makes one US-bound model, the bZ4X, while General Motors is yet to ramp up production of the Cadillac Lyriq and GMC Hummer.
With this being said, Farley cited BYD, Geely, Great Wall, Changan, and SAIC as the “winners” among Chinese automakers, saying that in order to beat them, Ford needs distinctive branding or lower costs:
"But how do you beat them on cost if their scale is five times yours?" he said. "The Europeans let (Chinese automakers) in - so now they are selling in high volume in Europe."
The Blue Oval company’s head honcho believes the Michigan-based automaker already has distinctive branding, so lowering costs is the only way forward. To make this happen, Ford wants to build a $3.5-billion EV battery plant in Michigan using CATL technology, but that deal has drawn pushback from politicians like the Republican House Majority Leader Steve Scalise and Florida Senator Marco Rubio, who cited possible ties with the Chinese Communist Party.
"We have a decision to make here in the US," Jim Farley said. "If battery localizing their technology in the U.S. gets caught up in politics - you know the customer is really going to get screwed."
In the first quarter of this year, Ford’s Model e EV division posted a loss of $722 million and the company is expecting the numbers to go even further into the red, with up to $3 billion in losses until the end of the year. However, the Blue Oval carmaker posted a net income of $1.8 billion as a whole, with its Ford Blue gasoline-powered business earning a $ 2.6 billion profit, while the Ford Pro commercial vehicle unit made $1.36 billion in Q1 2023.
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