CEO Jim Farley: “Building this future requires changing and reshaping virtually all aspects of the way we have operated for more than a century.”
Ford Motor Co. CEO Jim Farley on Wednesday said that he expects to see industry consolidation happen at nearly every level in the coming years and that Chinese companies could be among the big winners.
Speaking at the Bernstein Strategic Decisions Conference, Farley predicted that dealership groups, suppliers, electric vehicle startups and traditional automakers could merge, fall out of the market or form new joint ventures as the transition to EVs changes the industry.
“No doubt about it, we’re going to see very large consolidation,” Farley said. “Big changes.”
Farley said some smaller, traditional automakers simply won’t be able to afford the transition and that EV startups’ portfolios will get “simpler” over time.
“I just don’t see the addressable market these companies are going after being big enough to justify the capital they’re spending,” he said.
Farley said Chinese EV makers are poised to make gains in the North American market, noting that many new players based in the world’s largest vehicle market have very low EV manufacturing costs and have not yet looked into exporting.
“There’s a shakeout coming,” he said. “I feel like that shakeout is going to favor many of the Chinese new players.”
Farley said he thinks the coming consolidation would likely focus on more mergers than joint ventures.
“Partnerships are hard,” Farley said. “We’ve been in business for 118 years, and we probably have one partnership that worked really well: Ford Otosan in Turkey. Often they come down to the character of the leaders.”
The automaker currently has a partnership with Volkswagen Group, which Farley did not mention. Ford recently abandoned a tie-up to jointly produce a vehicle with Rivian and canceled a planned joint venture with Mahindra.
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.
Please enter a valid email address.
Please enter your email address.
Please verify captcha.
Please select at least one newsletter to subscribe.
See more newsletter options at autonews.com/newsletters.
Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.
Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.
The Automotive News mission is to be the primary source of industry news, data and understanding for the industry’s decision-makers interested in North America.
1155 Gratiot Avenue
ISSN 0005-1551 (print)
ISSN 1557-7686 (online)
Fixed Ops Journal
ISSN 2576-1064 (print)
ISSN 2576-1072 (online)