Ford CEO Emphasizes the Need for Americans to Rediscover Their Love for Smaller Cars

Ford CEO Jim Farley stated that the automotive industry must shift its focus to small electric vehicles and commercial vehicles. He acknowledged that while American consumers 'love large cars', they need to 'return to loving' smaller cars.

Farley added: 'We need to start focusing on smaller vehicles again. This is crucial for our society and for the adoption of electric cars. While we love these giant vehicles, and I do too, they pose a significant weight problem.' Last year, the average weight of new cars sold in the U.S. reached 2000 kg, an increase of 450 kg since 1980.

Ford anticipates launching a fully electric vehicle priced at $30,000 that will be profitable in about two and a half years. This will break the price barrier that has made electric vehicles a luxury only accessible to the wealthiest customers. Farley noted that Ford's new electric vehicle will compete with China's BYD, which the Biden administration is looking to effectively ban from the U.S. market by quadrupling tariffs on imports. It will also compete with a new electric vehicle from American company Tesla, expected to arrive next year.

Farley stated that Ford will focus on such vehicles, not on large electric trucks and SUVs. He said, 'As a car manufacturer, you must make a fundamental change to be able to produce a profitable electric vehicle. The first thing we need to do is direct all our capital towards smaller, affordable electric vehicles.'

However, he said the risks are substantial for Ford and other automakers in the next five years as they seek to compete with Chinese electric vehicle manufacturers. Farley stressed that it is essential for Ford, which lost $132,000 on each electric vehicle sold in the first three months of the year, to produce profitable electric cars in the next five years.

Farley stated, 'If we cannot make money from electric vehicles, we have competitors who have the largest market in the world, who are already dominating globally, and are already building their supply chains worldwide. If we do not produce profitable electric vehicles in the next five years, what is our future? We will shrink to the size of North American sales.'

Last month, the Biden administration announced it would impose a 100% tariff on Chinese-made electric vehicles, which could sell for as low as $10,000, significantly below the average $53,000 in the U.S. This move was interpreted as a political gesture to protect automotive jobs in swing states like Pennsylvania and Michigan.