Yahoo Autos Ford Hopes Small Electric Cars Might Make Americans Buy EVs
Good morning! It’s Wednesday, March 20, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Ford Pivots To Smaller EVs
A lot of noise has been made in recent weeks about the electric vehicle strategy America’s automakers are rolling out. They seemingly all decided it was a great idea to start with electric pickup trucks and other massive motors, until they didn’t quite take off as expected. Now, Ford is backtracking on this drive for big EVs and will reportedly redirect resources to develop smaller, more affordable electric models.
Ford has reportedly put plans for a new three-row EV on the back burner while it instead works on something smaller, reports Automotive News. The site claims that the Blue Oval could release a new model built on a new “small vehicle platform as early as late 2026.” As Automotive News explains:
Ford Motor Co. is delaying planned three-row electric vehicles similar in size to the Explorer and Lincoln Aviator as it focuses on smaller, more affordable EVs, according to people familiar with the company’s plans.
The three-row EVs, to be built in Canada at Ford’s planned Oakville Electric Vehicle Complex, were expected to go on sale in early 2025. Instead, Ford is shifting to launch an affordable EV on a small vehicle platform as early as late 2026, one of the people said.
That small crossover is expected to be built at the company’s Louisville Assembly Plant, the person said. The UAW and Ford agreed as part of its 2023 labor contract to add a new EV product to Louisville before the deal expires in 2028, although the parties did not specify timing.
The pivot to smaller electric models is all part of Ford’s plan to remain competitive against Chinese electric car makers, which are seen as a big threat to American automakers thanks to their *checks notes* bargain prices.
As such, Ford boss Jim Farley said that “smaller, cheaper EVs are needed to compete with Chinese automakers” and help Ford turnaround its loss-making electric vehicle arm.
2nd Gear: White House Softens Fuel Economy Rules
The White House has been working to update its emission targets in recent weeks, with rumors swirling that it’s about to delay some ambitious milestones that could help cut America’s emissions from transportation dramatically. Now, it sounds like the Biden administration may be about to scale back rules related to average emissions across an automaker’s lineup, which would force some to scale back production of gas-powered models.
The White House began changing tact on emissions targets after it emerged that many American automakers were way off meeting the new standards, reports Reuters. As such, new rules will come in to gradually reduce the equivalent fuel economy of electric vehicles. As Reuters explains:
The original Biden administration proposal would have lowered such “petroleum-equivalent fuel economy” ratings for EVs by 72% in 2027. The final rule will instead gradually reduce the equivalency ratings through 2030 by a total of 65%, giving automakers more time to adjust.
The industry cheered the Energy Department announcement. John Bozella, chief executive of the auto trade group Alliance for Automotive innovation, said the earlier proposal would “perversely disincentivize the production of battery electric vehicles” by scaling back EV fuel-economy credits that helped automakers meet federal regulations.
The new federal rules will govern all automakers selling U.S. vehicles but the biggest impact will be on the Detroit Three because of their heavy reliance on sales of large trucks and SUVs.
It was warned that the previous rules could have left American automakers like General Motors and Ford facing billions of dollars in fines for failing to meet average efficiency targets across their ranges.
