Ford to reignite electric car demand with affordable EV platform

A secret team of Ford engineers has been working for two years on a new platform for affordable electric cars, company CEO Jim Farley has revealed.

Speaking as the company released its fourth-quarter financial results for 2023, Farley said the company is “adjusting our capital [investment], switching more focus onto smaller EV products”.

He added: “This is important because we made a bet in silence two years ago. We developed a super-talented skunkworks team to create a low-cost EV platform.

“It was a small group, small team, some of the best EV engineers in the world, and it was separate from the Ford mothership. It was a start-up.

“And they've developed a flexible platform that will not only deploy to several types of vehicles but will be a large installed base for software and services that we're now seeing at [Ford] Pro.” 

Ford Pro is the company’s stand-alone commercial vehicle division, responsible for models such as the Transit and F-150.

Investment in higher-volume, lower-cost electric cars – likely destined to serve as indirect successors to the Fiesta and Focus – comes in response to Ford’s finding that most buyers are unwilling to pay over the odds to go electric.

Farley added that the availability of cheap credit pre-Covid and the pent-up demand for cars amid the semiconductor chip crisis, as well as the rapid rise in early adopters of EVs, “gave us too optimistic a demand signal”. 

This drove a “temporary spike in supply” and Ford struggled to find buyers for the cars it had built as it realised that – after the early EV adopters were on board – mainstream buyers were not prepared to pay a premium to go electric.

“As the Covid shock retreated, we learned that as you scale EVs to 5000-7000 units a month and you move into the [majority of customers], they are not willing to pay a significant premium for EVs,” said Farley.

He hailed an impending “huge moment”, pointing to the rate at which prices of hybrids and electric cars are aligning in the US, once EV subsidies are factored into the equation.