It is time for the US to “get back in love” with smaller cars, according to the chief executive of Ford.
In a wide-ranging recent interview, Jim Farley said the auto industry needs to focus on smaller EVs and commercial vehicles. He acknowledged that American consumers are in “love with these monster vehicles” but said they need to “get back in love” with small cars.
“We have to start to get back in love with smaller vehicles. It’s super important for our society and for EV adoption,” Farley said. “We are just in love with these monster vehicles, and I love them, too, but it’s a major issue with weight.” The average weight of a new vehicle sold in the US last year was 25 percent heavier than the 1980s.
Weight means more materials and more fuel / battery consumption. Indeed, according to a report from the International Energy Agency, if SUVs were a country, they would rank as the sixth most polluting in the world. And buying an electric version isn't really a good solution either. Hence the world, but particularly America, must “get back in love” with smaller cars.
As automakers like Ford move on towards an electric future and look to compete head-on with Chinese automotive rivals like BYD, CEO Jim Farley emphasizes that American buyers are going to have to make a sacrifice and break an automotive addiction that may seem un-American for the sake of the automobile industry's future.
Farley indicated that the next generation of electric Ford vehicles will not be the oversized SUVs and trucks that the Blue Oval is known for, as the team is focused on more compact, affordable vehicles that can turn a profit for the brand, reports The Street.
Ford expects to introduce a $30,000 all-electric vehicle that will be profitable in roughly two and a half years, reports The Guardian, breaking a price barrier that has made the adoption of EVs an unobtainable luxury to all but the auto industry’s wealthiest customers. Farley said it was crucial for Ford, which lost a whopping $132,000 on every EV sold in the first three months of the year, to make profitable EVs in the next five years.
Larger vehicles, using internal combustion engines, have traditionally driven US carmakers’ profits, especially at Ford.
“You have to make a radical change as an [automaker] to get to a profitable EV. The first thing we have to do is really put all of our capital toward smaller, more affordable EVs,” Farley said during an interview with CNBC’s Julia Boorstin. “These huge, enormous EVs are never going to make money: the battery is $50,000, even with low-nickel, LFP chemistry. They will never be affordable.”