Ford CEO picks Chinese EV over Tesla: Here’s why

Ford CEO Jim Farley spent six months in 2024 driving a Xiaomi SU7, a Chinese electric vehicle that starts around $30,000, and when asked why he didn't test a Tesla instead, his answer was pointed: Tesla simply doesn't have a current enough vehicle to benchmark against.

Speaking on the Rapid Response podcast with host Bob Safian, Farley was direct about his reasoning. "Nothing against Tesla; they've been doing great, but they really don't have an updated vehicle," he said. For Farley, understanding the future of EV competition means studying China, not Silicon Valley.

He praised Chinese automaker BYD as best in the business, citing the company's cost structure, supply chain depth, and manufacturing precision as capabilities that American brands need to match, not dismiss.

Farley identifies a particular market opportunity which Ford currently attempts to achieve through its fast-paced development efforts. The next wave of American EV buyers, he argued, wants pickups, SUVs, and a range of body styles but at $30,000, not the $50,000 price points that defined the first generation of electric vehicles.

The Maverick XL serves as Ford's most affordable hybrid vehicle, which starts at a price of approximately $28,000. The starting price for Tesla's Model 3 essential version is $36,990. Farley believes that Chinese automakers will exert maximum pressure on American companies through this $9,000 price difference unless American brands take action first.

The urgency behind Farley's words is backed by real financial pain. Ford announced in December that its pivot away from the fully electric F-150 Lightning toward smaller, more affordable hybrid models would cost the company approximately $19.5 billion. It's a painful reset, but one Farley frames as necessary to survive a rapidly changing market.

This isn't the first time Farley has raised the alarm. Earlier in April, he told Fox & Friends that Chinese vehicles entering the US market would be devastating to domestic manufacturing, an industry he called the heart and soul of the country. His strategy, as he described it, is to absorb BYD's cost competitiveness and apply it to vehicle segments where Ford has loyal, established customers.