By making a battery-powered version of the best-selling vehicle in the United States, the F-Series pickup, as well as mainstream models like the Ford Transit commercial van and the Ford Mustang sports car, Ford Motor Co., a not-so-secret weapon – volume – that newcomers like electric vehicle maker Tesla and other startups can’t match.
“Pricing power” is a key part of the plan to achieve profitability of Ford’s high-volume battery-electric vehicles, said Lisa drake, Ford COO, North America, and Vice President, Global Purchasing, in a recent presentation for analysts, investors and the media on Wall Street.
“Let’s start with Ford’s pricing power. Launching our BEVs with our most iconic brands allows us to take their strengths and desire to a whole new level, ”said Drake. Ford said in the presentation that it expects 40% of its new vehicle volume to be BEVs by 2030, up from a single-digit figure today.
Building or buying parts per million is a huge unit price advantage over building or buying parts in the thousands or even hundreds of thousands, Drake said. Part of Ford’s advantage is that its electric vehicles will share a large number of components with conventionally-powered versions of the same model.
“When we buy our next-gen models with contracts with almost 4 million units of volume for an F-Series lifecycle for everything from tires to display screens, we know we’re getting the best of. our suppliers in terms of cost, quality and advanced technology, ”she said.
“Compare that with the start-up manufacturer of BEV, which is looking to purchase 120,000 display screens over the life of its truck. Ford’s purchasing power and scale advantage, and the value of non-electric parts in a pickup truck – nearly 50% of the material cost of trucks – is significant, ”said Drake.
“The same goes for how we view the electrification cost benefit of our E-Transit, looking at the scale of the world’s best-selling van,” she said.
Ford also intends to generate volume cost benefits on parts of its battery-electric vehicles that are exclusive to BEVs, such as the batteries themselves, which Ford intends to manufacture in-house. Drake said, “We are absolutely committed to designing, designing and manufacturing our own batteries.”