An electric Ford truck is on display 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 at the Aspen Ideas Festival.
Farley did not release 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 BYD and an expected entry-level car from the American EV leader Tesla.
Farley said Ford is focusing on smaller electric vehicles first instead of larger, all-electric trucks and SUVs. These have historically been profitable engines for the company because such vehicles are “never going to make money.”
'As an entrepreneur you have to make a radical change [automaker] “We have to put all of our capital into smaller, more affordable EVs,” Farley said during an interview with CNBC’s Julia Boorstin. “That’s the duty cycle that we’ve now found really matches. These big, huge, huge EVs will never make money. The battery is $50,000… The 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 massive battery packs to achieve significant EV range of 500 miles. He wasn't referring to models like Ford's current all-electric F-150 Lightning pickup or the next generation of EVs.
Ford said earlier this year it was delaying production of a large, three-row SUV at a plant in Canada from an original 2025 plan to 2027. The next-generation pickup truck, codenamed the T3, was also delayed from late 2025 to 2026.
Farley reiterated Friday that Ford's next generation of vehicles would be profitable.
He also said that Americans need to “go crazy” about small cars again instead of bigger ones. That's a surprising statement considering most of Ford's profits come from trucks and U.S. automakers have historically struggled to make money on small models.
“We need to fall back in love with smaller vehicles. It’s super important for our society and for the adoption of electric vehicles,” Farley said Friday. “We’re just in love with these monster vehicles, and I love them, but it’s a big problem with weight.”
Ford’s EV division lost $1.32 billion on every 10,000 vehicles sold wholesale in the first quarter of this year. While the unit also includes EV-related items such as software, those losses equate to a loss of $132,000 per vehicle the unit sells.
Farley said it is critical for Ford to make profitable electric vehicles over the next five years as Chinese automakers continue to expand globally.
“If we can’t make money with EVs, we have competitors who have the largest market in the world, who already dominate globally and are already setting up their supply chain all over the world,” he said. “And if we don’t make profitable EVs in the next 5 years, what’s the future? We’re just going to shrink in North America.”
