American car shoppers yearning for an affordable electric vehicle won’t have to wait long. Ford CEO Jim Farley has promised that a new $30,000 EV will be introduced in early 2027, reports CNBC. Speaking at the Aspen Ideas Festival, the chief executive said the new electric car will be affordable for consumers and profitable for the automaker.

This is important because, as it stands, Ford is losing money on its electric vehicles. In April, the Blue Oval admitted that the Model e division lost $130,000 per vehicle. Pivoting to profitability requires a change. Ford has put plans in place to develop larger electric trucks and SUVs on hold in favor of smaller EVs. Farley said this change was necessary as large electric vehicles are “never going to make money.”

Small EVs = Profitable EVs

Ford’s large trucks and SUV buyers are a traditional bunch. They prefer a large gas-powered engine to propel them along, not an unfamiliar battery pack. Therefore, building an affordable EV that will appeal to the masses makes sense. “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,” said Farley in an interview with CNBC.

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“That’s the duty cycle that we’ve now found that really matches. These big, huge, enormous EVs they’re never going to make money. The battery is $50,000…the batteries will never be affordable,” he added.

It’s worth noting that the CEO isn’t referring to the F-150 Lightning and its eventual successor, but rather larger trucks such as the Super Duty Series. These trucks would require massive battery packs to provide drivers with the 500-mile range they would expect. Cross-town rival Ram is working on hydrogen solutions for its Super Duty offerings, with a fuel-cell-powered 5500 expected to arrive this year.

Ford Delayed Large EVs To Focus On A Smaller Electric Car

The Blue Oval initially planned to introduce a three-row electric SUV in 2025. Production was expected to kick off next year, but Ford has postponed this to 2027. Similarly, a new electric pickup (known only by its T3 codename) will arrive in 2026, not next year. While these larger vehicles are still on the way, Farley says Americans need to fall back in love with smaller cars, suggesting the new $30,000 EV will be smaller than local consumers expect.

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“We have to start to get back in love with smaller vehicles. It’s super important for our society and for EV adoption. We are just in love with these monster vehicles, and I love them too, but it’s a major issue with weight.”

A smaller car would require a smaller battery pack, which minimizes the environmental impact and keeps weight to a minimum. This would make the vehicle more eco-friendly from the get-go and more fun to drive.

Developed To Take On BYD And Tesla

It’s interesting to hear Ford’s CEO encourage the adoption of smaller cars, as the automaker’s success has been built on large, thirsty trucks and SUVs, such as the F-150, Expedition, and so on. Smaller cars traditionally haven’t done well for Ford USA, which has killed off the Focus, Fiesta, and Ecosport in the States. However, Farley believes small cars hold the key to affordable electric cars.

Earlier this year, Ford confirmed that a “skunkworks” team had been hard at work developing a low-cost EV platform that will compete with BYD and Tesla, both of which are highly profitable. “If we cannot make money on EVs, we have competitors who have the largest market in the world, who already dominate globally, setting up their supply chain around the world. And if we don’t make profitable EVs in the next five years, what is the future? We will just shrink into North America,” he concluded. It’s worth noting that Jeep plans to introduce an electric vehicle priced at $25,000 (after tax credits). It remains to be seen whether more brands will offer affordable EVs, but our guess is yes.

Source:
CNBC