Ford CEO Farley talks EV tax credit, chip shortage
Ford has committed more than $30 billion to EVs by 2030
Ahead of his meeting with President Biden alongside other business leaders, Ford CEO Jim Farley sat down with FOX Business’ Grady Trimble.
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Wednesday’s White House meeting will center on Biden’s stalled Build Back Better bill, which includes a $12,500 electric vehicle tax credit. When asked if he’s in favor of standalone legislation to pass the tax credit even if BBB fails, Farley said he supports "whatever it’s going to take."
"We have to catch up," he said, citing higher EV sales in China and Europe. "We’re going to do the investment in the product and capacity expansion and make vehicles as affordable as possible. We need the government’s help to make the switch to e-mobility through consumer incentives."
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Shares of Ford Motor Company are up nearly 80% in the past year while GM shares are down over 1%. Ford has committed more than $30 billion to EVs by 2030 and recently announced it will build two electric truck and battery plants in Kentucky and one in Tennessee.
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"I think we’re one of the first to scale. We’re committed to 600,000 units in 22 months from now," Farley told Trimble. "What makes us different [from other EV makers] is we’re electrifying our most iconic vehicles where we sell the best."
Ford sold around 27,000 Mustang Mach-E SUVs in 2021. It begins deliveries of its F-150 Lightning later this year. High demand for the all-electric pickup truck and the hybrid Maverick pickup truck led the automaker to stop taking reservations.
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Interest in the Maverick, with an MSRP of $19,995, comes as new vehicle prices are at an all-time high, up about 12% from a year ago, according to Consumer Price Index data. The chip shortage has greatly contributed to those higher prices, and Farley predicts that challenge will plague the industry through 2023.
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"We’re still in the teeth of it," Farley said. "I think this year will be very challenging for semiconductor availability. We’re maximizing production in our most profitable vehicles. That’s helping offset the loss in production, but it’s a very persistent problem."
The company is also electrifying its commercial Transit van. Farley spoke to Trimble at Dutton Ranch, a vineyard in California’s wine region that has been using the E-Transit, along with the automaker’s commercial fleet management service Ford Pro. While the company announced Walmart has ordered 1100 E-Transit vans, Farley said the focus is also on small businesses, like plumbers and electricians.
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"They are underserved customers with data and telematics. They don’t have good financing options," he explained. "We are going to wrap it in the easy-to-use, easy-to-order services platform."