Ford to launch lowcost EVS to rival Chinese

FORD is to launch a range of low-cost electric vehicles as it seeks to compete with Chinese manufacturers and Tesla.

Jim Farley, the US carmaker’s chief executive, has announced plans to move away from big, expensive EVS to cheaper models. It is an attempt to convince mainstream car buyers to go electric, after years of secret development in a so-called skunkworks hived off from the main business.

High prices are the biggest factor holding back consumers from purchasing EVS over petrol vehicles, Mr Farley said. He told analysts Ford had “made a bet in silence two years ago” to start developing cheap EVS. Mr Farley said: “We’re also adjusting our capital, switching more focus on to smaller EV products. All of our EV teams are ruthlessly focused on cost and efficiency in our EV products because the ultimate competition is going to be the affordable Tesla and the Chinese.”

His words mark the latest move in the battle between Chinese and Western carmakers f or el e ctri c market share. Chinese electric carmakers have been racing to challenge Western players. Elon Musk’s Tesla has long been the world’s best-selling electric carmaker, but it was knocked off the top spot at the end of last year by China’s biggest EV manufacturer BYD. In the last three months of 2023, BYD sold 526,000 battery-only cars, nearly a 10th more than Tesla’s 484,000.

BYD plans to build an EV factory in Hungary and wants to sell 800,000 cars a year in Europe by 2030. Last year, Wang Chuanfu, its founder, said Chinese car companies should “demolish the old legends”. Ford’s results showed revenue in the last three months of 2023 was $46bn (£36bn), $5.7bn more than analysts expected. Adjusted earnings per share were twice the consensus forecast. But so far Ford is making a loss on its existing electric battery cars. In 2023, these models lost Ford $4.7bn.

This deficit means Ford lost around $28,000 on each battery-powered car that it sold last year, according to Bloomberg Intelligence. In 2024, Ford expects its losses on electric cars to rise by a further 17pc to hit $5.5bn.

It is no longer forecasting that it can reach its aim of making 8pc profit margins on EVS by 2026.