Ford targeting $25,000 compact electric car by 2026

Facing dwindling sales of the Mustang Mach-E and F-150 Lightning, Ford is repositioning itself in the electric vehicle (EV) market. The automaker’s new direction is highlighted by plans to introduce a compact electric car priced around US$25,000 by the end of 2026.

According to a report from Bloomberg, citing sources familiar with the plans, the development of this new EV platform is spearheaded by a specialized team in Irvine, California, led by Alan Clarke, a prominent figure who joined Ford after contributing to the engineering success of Tesla’s Model Y.

With fewer than 100 people, this team is at the forefront of Ford’s effort to create a new electric platform that will underpin a variety of compact vehicles, including a small SUV, a pickup truck, and possibly a vehicle suited for ride-hailing services.

One of the key components to achieve this pricepoint is the adoption of lithium iron phosphate (LFP) batteries, which are approximately 30% less expensive than traditional lithium-ion batteries. Additionally, the company is exploring alternative battery technologies to drive down costs even further.

Ford’s CEO, Jim Farley, who had previously talked about this new EV platform but without as many details, has reportedly set a high standard for the company’s venture into the small EV market: these vehicles must become profitable within a year of their release.

Ford is currently losing billions of dollars in their Model e electric division, reporting a $4.7 billion loss in 2023.

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