Ford says it has a ‘Skunk Works’ team trying to make lower-cost EVs

Ford says it has a top-secret, high-powered team working to design its future electric vehicles. It’s part of a quest to compete profitably against Tesla and lower cost EV makers from China.

Ford says it has a top-secret, high-powered team working to design its future electric vehicles. It’s part of a quest to compete profitably against Tesla and lower cost EV makers from China. People in the market for an electric luxury vehicle can find plenty of options to choose from. That’s because EV technology, particularly batteries, is expensive so it’s easier for automakers to earn a profit on an Audi, Mercedes or Cadillac because people are used to paying more for those luxury car brands. Even among mainstream auto brands, like Ford, EVs tend to cost more. Take the Mustang Mach-E, for instance, with prices starting around $45,000. Those prices are starting to hamper sales. In the US, EV sales growth has slowed and cost is seen as a major reason. Electric vehicle sales increased by 40% in the fourth quarter of 2023 compared to the same period in 2022, according to Cox Automotive. While that’s strong growth, it was less than the 49% growth in the quarter before or the 52% year-over-year growth seen in the same period the year before. In a study released late last year by S&P Global Mobility, almost half of people surveyed globally thought EV prices were too high. “Pricing is still very much the biggest barrier to electric vehicles,” said Yanina Mills, senior technical research analyst at S&P Global Mobility, in an announcement about the survey. Accordingly, Ford has had a team working on engineering for inexpensive electric vehicles for two years, chief executive Jim Farley said on a recent investor call.