Ford investing $5 billion for next-gen electric vehicles to take on China
Add Axios as your preferred source to
see more of our stories on Google.
Ford CEO Jim Farley at an electric vehicle event in Kentucky. Photo: Joann Muller/Axios
Ford is investing $5 billion across two factories to build a low-cost universal electric vehicle platform, which will underpin a family of affordable EVs it hopes will match China's costs and features.
Why it matters: The effort includes a complete rethinking of how vehicles are assembled — essentially throwing out the traditional assembly line Henry Ford invented — in order to overcome China's low-cost labor.
- "We took a radical approach to a very hard challenge: Create affordable vehicles that delight customers in every way that matters – design, innovation, flexibility, space, driving pleasure, and cost of ownership – and do it with American workers," Ford president and CEO Jim Farley said at an event in Kentucky on Monday.
- "We have all lived through far too many 'good college tries' by Detroit automakers to make affordable vehicles that ends up with idled plants, layoffs and uncertainty. So, this had to be a strong, sustainable and profitable business," Farley said.
- "We tore up the moving assembly line concept and designed a better one."
Between the lines: The first product, on sale in 2027, will be a midsize four-door electric pickup starting around $30,000.
- Ford is investing at its Louisville Assembly Plant in Kentucky to prepare for the breakthrough manufacturing process.
- The vehicle — and future derivatives on the same platform — will be assembled in three large castings on separate lines, which will then united in final assembly.
- The new process will be dramatically faster and cheaper, and far less taxing on employees, officials said.
By the numbers: The EV platform will have 20% fewer parts than a typical vehicle, with 40% fewer fasteners.
- The number of employee work stations is reduced by 40%, while assembly time, measured in hours per vehicle, will be 40% shorter, too.
Yes, but: New efficiencies mean fewer jobs. Ford said it is "securing" 2,200 jobs at Louisville, which currently employs 2,800 to build gas-powered Ford Escape and Lincoln Corsair SUVs.
- 600 workers will be offered buyouts or move to other plants, including Ford's nearby Kentucky Truck plant.
Of note: The $5 billion investment includes a new $3 billion battery factory in Michigan that is gearing up to make lithium-iron-phosphate batteries, using technology licensed from China's CATL.
