According to Jim Farley, the CEO of Ford Motor Co (FMC), Chinese manufacturers have become the primary contenders in the electric car market. However, the United States-based company faces challenges in competing with them on a smaller scale due to cost factors.
During the Morgan Stanley Sustainable Finance Summit, Farley expressed his views on the competition, stating, “Rather than GM (General Motors) or Toyota, we consider Chinese manufacturers as our main rivals.”
Farley emphasized that China, being the largest car market in the world, possesses advanced battery technology and dominates the production of electric vehicles. He specifically mentioned BYD, Geely, Great Wall, and Changan as the leading Chinese automakers in this field.
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To surpass the Chinese automakers, Farley believes that Ford needs a separate brand offering more affordable prices.
However, Farley acknowledged the challenge of competing with Chinese manufacturers on cost when their scale is five times larger. He questioned, “How can you outperform them in terms of cost when their scale is significantly greater than yours?”
He further stressed that European markets have allowed Chinese producers to enter, resulting in high volumes of sales in Europe.
In a strategic move, Ford announced its plan in February to invest $3.5 billion in the construction of an electric vehicle battery plant in Michigan. To achieve lower costs, Ford intends to collaborate with its Chinese partner CATL for battery production.