Shocking: Ford Wants to Make a Profitable $20K EV
One of the major keys to gaining the advantage in the ongoing EV wars is finding that sweet spot with price. Ford Motor Company is already well on the path with its all-new 2022 Ford F-150 Lightning, which starts under $40,000 (and has already racked up 100,000 reservations and counting). But Ford has plans to halve that price, hoping to churn out a $20,000 EV sooner rather than later.
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In June, Automotive News spoke with Ford President of the Americas and International Markets Group Kumar Galhotra, who had no hesitation throwing out the $20k figure when asked about profitability.
Responding to the question of how vehicle size relates to EV profitability, Galhotra said that Ford’s current goal is to “bring that point lower and lower so that higher-volume, smaller-sized vehicles can be profitable as well.”
Galhotra added: “If we go much lower with a price point, say $20,000, it obviously won’t be possible. But we’re working towards it.” He also noted that the new Mustang Mach-E is a profit-earner, as are the upcoming E-Transit van and 2022 Ford F-150 Lightning.
Profitability will prove harder with EVs due to the relative newness of the technology, but continued advances in battery development should help the push to make vehicles more profitable. Ford recently increased its equity stake in Solid Power, a startup focused on developing solid-state batteries for EVs.
Ford cracks $20K price for hybrids with new Maverick
If it’s an attainable goal — and Galhotra seems to suggest it is — offering an affordable $20,000 would give Ford a considerable edge as the EV wars ramp up. At the present moment, $30,000 is right about the sweet spot for affordable EVs. The Mustang Mach-E starts at $42,895 MSRP, but it prices around $35,000 with available federal tax credits.
Of note is the fact that Ford recently introduced its Maverick, a sub-$20,000 hybrid compact truck that arrives this fall. While Ford has focused ink on the fact that the Maverick will be the first standard full-hybrid pickup sold in America, it hasn’t noted the fact that the truck is the only new hybrid vehicle available for under $20,000.
When it hits, the Maverick will comfortably stand as the most affordable new hybrid vehicle on the market today, undercutting the 2022 Honda Insight by more than $5,000. That alone should prove evidence enough that if someone’s going to hit $20,000 for an electric vehicle, Ford has as good a shot as anyone at doing it first.