Ford tries again with electric: 5 billion for a new Model T moment

The challenge, in fact, is titanic. Ford's Model E division recorded losses of 5.08 billion in 2024, with revenues down 35% to 3.9 billion. From 2023 to 2024, electric and software operations burned almost 10 billion in total. Sales of the three current electric models - Mustang Mach-E, E-Transit and F-150 Lightning - dropped by 12% in the first half of the year, while hybrids - and it is not only happening in America - are flying (+27%).

The real test remains the Chinese competition. Manufacturers such as BYD have optimised their supply chain and production to sell electrics between $10k and $25k, against a US average of $47k. Ford will use lithium-iron-phosphate batteries produced in Michigan with technology from Chinese giant CATL to cut costs.

"We are not in a race to build more electric cars," Farley explained, "but we are in a race to have a sustainable, profitable electric business that customers like. The Californian 'skunkworks' team, led by former Tesla Alan Clarke and composed of talent from Tesla and Rivian, works in secret on the new affordable models.

The game is played on price. Startups such as Slate (backed by Jeff Bezos) are aiming for $25,000 electric pickups, Tesla has promised a cheaper model that has yet to be seen, while Rivian and Lucid are preparing low-cost versions (above $40,000, anyway). Ford has already scaled back some targets, cancelling the three-row SUV and postponing the new F-150 Lightning and E-Transit until 2028.

Ford's approach contrasts with that of General Motors, which electrifies its entire range, from the mastodon Hummer to the compact Equinox. While GM has invested time in a dedicated electric platform, Ford has converted existing models to get to market sooner, but paying the price of volatile demand.

"The American pure EV market is as follows: small vehicles for commuting and cities," Farley recently stated. A vision that could prove successful if Ford can deliver on its promise of profitability within a year of launch. However, the challenge to the Chinese model remains formidable: closing a price gap of more than $20,000 will require an unprecedented change of pace.