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Ford’s $5 billion plan to get cheaper electric vehicles on the road by 2027 is intriguing not simply because it’s happening as the Trump Administration works to hamper the EV industry’s growth, but because it signals both it and General Motors, which make most of their money selling big gasoline-powered pickups and SUVs, seem to be getting serious about competing with Tesla and Chinese automakers that threaten their long-term health.
There aren’t a lot of specifics yet about Ford’s $30,000 electric pickup that’s due in a couple of years, but its new low-cost manufacturing process and a cheaper lithium-iron phosphate, or LFP, battery could help the company that standardized assembly-line production over a century ago become a key player as the global auto industry rapidly electrifies.
GM, which has seen strong sales of its newest electric models this year, including the $35,000 Equinox SUV, is also introducing a restyled Bolt crossover this year that’s likely to sell for about $30,000. That could be compelling to many carbuyers since the average new EV sold in the U.S. currently goes for $55,689, while the overall new car or light truck average transaction price is $48,841, according to Kelley Blue Book.
Like Ford, GM plans to use new, cheaper battery chemistries, including LFP cells as well as a new lithium-manganese battery due in 2028, and has committed billions of dollars to electrifying its lineup.
Both carmakers may be tempted to slow those efforts now that Trump has killed off federal EV rebates and manufacturing incentives. Weakened federal fuel-efficiency rules might entice them into relying more on gasoline-powered trucks, but doing so would threaten their sales outside the U.S., as low-cost Chinese EVs, particularly those from BYD, rapidly take market share from gasoline-powered models in Europe, South America and Oceania. And after a decade of EV dominance in the U.S. by Tesla, Elon Musk’s fading popularity has done substantial damage to that brand, creating a new opportunity for traditional automakers like Ford and GM to gain sales from new buyers, particularly in EV-loving California.
The Big Read
California High-Speed Rail Authority
How AI Data Centers Could Save California High-Speed Rail
With the clawing back of $4 billion in federal grants to support it, the Trump Administration seems hell bent on ensuring that California’s high-speed rail project ends up as precisely the “train to nowhere” the President has lambasted it as. Gov. Gavin Newsom is suing to keep the money, but the train’s new CEO has big ideas for saving the priciest U.S. infrastructure project. They include new long-term funding, private partnerships and even turning to one of California’s newest “natural” resources: The AI data center.
Ian Choudri, who spent decades working on global mega-infrastructure projects for major engineering firms Bechtel, Alstom and Parsons before taking the high-speed rail job last September, is on a mission to convince skeptics that after years of slow progress, the Golden State’s bullet train from San Francisco to Los Angeles can be built– perhaps for less than its $128 billion price tag and even without federal support.
“We’ll show that it becomes less cumbersome on taxpayers because it’s generating revenue,” he told Forbes, without providing financial details. In addition to future ride revenue, he thinks the system can make money by letting tech firms build data centers on its land, powering them with solar farms that will also propel its trains. Other ideas include selling the rights to telecom companies to lay fiber optic cable along the train’s path, and promoting real-estate development projects on its route, particularly in the lower-priced Central Valley region.
“We’re getting contacted by Silicon Valley investors now asking, ‘Hey, can we move data centers into Fresno and plug into your power grid that’s renewable?’” Choudri said. “If I combine all those ancillary revenue sources, roughly it’s going to be 30% to 40% of the farebox revenue.”
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Hot Topic
Jiten Behl, partner at Eclipse Venture Equity, on key factors driving next-generation electric vehicle development
Given headwinds in the U.S. for EVs coming from the Trump Administration, how do you see the market changing, based on your time as Rivian’s chief strategy officer?
Electrification as a trend is going to only go in one direction. The one single most valid data point is that anybody who drives an electric car is not going back to a gasoline or a diesel car. That’s a fact more than just a prediction.
The slope of the [EV market] curve … was actually fairly slow penetration, which is why it did not initially get the attention of the Fords and the GMs and all the big automakers. Then it accelerated, and they started taking it very seriously. Now what’s happened in the last couple of years is that despite recent news we’re seeing from automakers like GM and Ford, I don’t share the same level of optimism that they’re going to put the commensurate weight behind electrification as they would have a couple of years back. What that does is it’s going to separate the guys who are serious about this trend, whose life depends on this trend, from the ones who have other cards in their pocket to survive this next phase.
I think the EV trend continues. It is going to slow down. Incentives going away and the supply chains getting more expensive are a serious headwind for anybody who’s building a product that’s economically challenged relative to competition or competing powertrains.
What’s your advice to companies grappling with this situation?
I think it’s an opportunity to invest in automation, invest in removing labor hours through robotics and invest in autonomy. The world 10 years back, it was always about electrification; autonomy was a side project for most people. It’s very clear that the world of electrification and autonomy has merged.
That next level of merging is electrification, autonomy and distributed energy, which is not being talked about a lot. When things become electric and autonomous, you cannot just rely on fixed-grid infrastructure to power them and still maintain the uptime and the cost, the total cost of ownership. You need flexible energy solutions to enable electric, autonomous vehicles.
If you ask me what, if I were at Rivian today, what would our executive sessions be like, it’s: How do we make sure that we take cost out? We have to reorder our supply chains. It’s going to take time. Let’s invest in automation. Let’s invest in robotics. Let’s make sure that we are not reduced to being just a hardware player, so let’s invest in the AI and the compute side of things and make a big play in autonomy. Let’s make sure that we automate our plants as much as possible and do not take our eye off the ball when it comes to the energy side of things.
Those to me are the four or five things I’m sure are on top of every automaker management team’s mind.
What Else We’re Reading
Installing heat pumps in factories could save $1.5 trillion–and 77,000 lives (Grist)
PFAS “forever” chemicals were found in 98% of U.S. waters tested, according to study (Mongabay)
Scientists rush to bolster climate findings that the Trump administration aims to undo (The Guardian)
A range of industrial innovations led to much cheaper solar panels. New research sees opportunities to similarly slash costs for renewable energy systems and batteries (MIT News)
Trump administration reopens $5 billion EV charging program after losses in court. The Transportation Department had halted the Biden-era program (Canary Media)
The UK asks people to delete emails as a water-saving step during a drought (The Verge)
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