How Ford Is Going To Out-China China With A Tiny EV Pickup

Everyone is freaking out about China and the best part of it is this is a slow-motion, Austin Powers-with-the-steamroller type of potential collision that could take months or years. Ford is betting it has at least two years to make something happen.

There’s a big report from OG Keith Naughton today and it’s mostly a rehash of stuff that’s already been reported, but it does include some juicy nuggets on Ford’s skunkworks EV plans.

While the fear of Chinese cars is strong, GOP Presidential Candidate Donald Trump has a solution: 100% tariffs on Chinese-made EVs, even if they come from Mexico. Could it work?

Helping slow down the transition into EVs will be revised EPA rules which, yeah, will reportedly not be as strict as initially feared.

And, finally, the UAW gets one step closer to finally unionizing the VW plant in Chattanooga.

What We Know About Ford’s Tiny Electric Car Trio

We’ve already talked about the small EV platform being developed by a Ford Skunkworks team, which the world first learned about from Ford CEO Jim Farley himself, who said:

We’re also adjusting our capital, switching more focused on to smaller EV products.

Now, this is important because we made a bet in silence two years ago. We developed a super-talented skunkworks team to create a low-cost EV platform. It was a small group, small team, some of the best EV engineers in the world, and it was separate from the Ford mothership. It was a start-up.

We later learned it was Alan Clarke, formerly of Tesla and the Model Y, who was running that team. Now, via this big Bloomberg Businessweek piece from Keith, we’ve got some other juicy details:

Bloomberg Businessweek has learned that this team consists of fewer than 100 people working on a new electric platform to underpin a compact SUV, a small pickup and, potentially, a vehicle that could be used for ride-hailing, according to one of the people. The first model will arrive in late 2026, starting around $25,000—matching the expected base price of a low-cost EV that Tesla is working on, the person said.

Initially, Ford’s compact EV will be powered by a lithium iron phosphate battery, which is about 30% cheaper than traditional lithium-ion batteries, but it’s exploring other battery technology to cut costs further, the person said.

Let’s break this down a bit because there’s a lot in these two paragraphs.

First, An LFP battery makes perfect sense here from a cost and use perspective, assuming we’re getting something that can compete with the sub-$10k BYD Seagull and impending Tesla Model 2.

Second, the pricing makes perfect sense as the sub-$25k price point is the magic price point a lot of automakers in the United States are aiming for in the cheap EV space. With the Bolt going on hiatus, the closest we have is the $35k Volvo EX30 and $25,000 Nissan Leaf.

Third, everyone assumed it was going to come as a compact hatch/SUV/crossover-type vehicle. It’s the most space-for-your-buck and Ford is basically: Trucks/SUVs + Mustang, and there’s already a Mustang EV.

Fourth, a small truck eh? Interestingly, Ford’s already trying to out Cybertruck the Cybertruck with a next-gen EV truck codenamed T3 that’ll debut next year. Certainly, the huge success of the Ford Maverick shows there’s a path forward for affordable small trucks. A minitruck! I can’t wait. This all sounds like the Ford 24.7 concept, which isn’t a bad thing.

Fifth, the vehicle for “ride-hailing” is interesting. Electric cars make for good ride-hailing vehicles in urban areas and also have the kinds of use cycles where LFP battery chemistry probably works better than NCM. I sort of picture a variant of the hatch but with a simplified driver setup and more space for luggage and passengers. Ford is great at fleets and this fits nicely into Ford’s larger Ford Pro strategy of integrating software into its vehicles.

I’m anxious to see this thing, but short of a leak we’re probably not seeing it for another year or so at the earliest.

Trump: 100% Tariffs On Mexican-Made Chinese Cars

A lot of people focused on the whole “bloodbath” if I’m not elected part of former President Trump’s speech, but I’m going to focus on the part about putting a 100% tariff on EVs from Chinese brands made in Mexico because this is a car site and the rest of it is out of scope and, frankly, depressing.

People are worried about Chinese cars. Some in the industry are calling Chinese cars an existential threat. The rhetoric is wild.

Let’s look at the actual quote, via Politico, which includes the little bloodbath bit mixed in with everything else:

“China now is building a couple of massive plants where they’re going to build the cars in Mexico, and they think they’re going to sell those cars into the United States — no,” Trump said Saturday during a rally near Dayton, Ohio. “We’re going to put a 100 percent tariff on every single car that comes across the line and you’re not going to be able to sell those cars — if I get elected.”

“Now if I don’t get elected, it’s going to be a bloodbath for the whole — that’s going to be the least of it,” he continued, adding: “But they’re not going to sell those cars.”

There are some important details here to discuss, so let’s take it as it comes.

Yes, Chinese automakers are expanding their production to Mexico. That is true, though those automakers are saying that’s because they want to serve the Mexican and South American markets.

As President, Trump did indeed slap a 25% tariff on Chinese cars that President Biden upheld, meaning that Chinese cars face a 27.5% tariff. That’s a lot for any car, but companies like BYD can probably build competitive cars that are still cheap even with that tariff. Saying he would add a 100% tariff definitely sounds steep, but I’d argue that even at 100% it may not be enough to keep all Chinese cars out.

As President, Trump also signed the revised U.S.-Mexico-Canada Agreement (USMCA) which sought to fix some of the issues with NAFTA. Ironically, that new agreement might make something like bringing over Mexican-built Chinese cars even easier and, at the same time, it could make enforcing a unilateral 100% tariff harder without reopening the agreement.

Ultimately, it doesn’t really matter because there’s clear bipartisan support to make Chinese EVs not happen here, and President Biden is exploring a ban on “connected” Chinese cars, which is any car with a modem, which is basically any modern car.

EPA Likely To Revise EV Mileage Requirements In A Way Automakers Will Like

This time last year we wrote about the EPA’s strictest-ever fuel economy mandates. There was a strong reaction from automakers and a general sense recently that the Biden EPA might be encouraged to back down a bit.

According to Reuters, that’s exactly what’s happening.

Under the initial EPA proposal covering 2027-2032, automakers were expected to aim for EVs to constitute 60% of their new vehicle production by 2030 and 67% by 2032 to meet stricter emissions requirements.

Automakers are expected to be able by producing significantly fewer EVs in 2030 under the final rules. The Alliance for Automotive Innovation representing nearly all major automakers except Tesla had urged EPA to finalize rules resulting in closer to a 50% EV sales target by 2030.

The final rule softens the pace of improvements and then sharply ramps up stringency requirements through 2032, the sources added.

VW Seems Kinda Resigned To This Union Thing

The UAW has tried a bunch of times to unionize the Volkswagen plant in Chatanooga, Tennessee, and narrowly missed as recently as 2019.

Given all the success of the UAW recently it’s not a surprise that workers at the plant are trying again. The UAW also said it wouldn’t move for a vote until 70% of the employees there sign a union card and the announcement of a push for a vote/recognition is a sign that the UAW has hit that threshold.

CNN got a statement from Volkswagen and it lacks a lot of the punch we’re used to from other automakers:

The VW Chattanooga plant is the only factory operated by VW that does not have union representation. But the union lost two previous votes when it attempted to organize the plant – in 2014 and again in 2019. But the union gained ground, winning 48% of the vote in the 2019 election.

“We respect our workers’ right to a democratic process and to determine who should represent their interests,” said a statement from VW. “Volkswagen is proud of our working environment in Chattanooga that provides some of the best paying jobs in the area.”

Is this happening? It feels like this is happening. Honestly, it might be better for VW to just voluntarily recognize the union and try to get a better deal.

What I’m Listening To While Writing TMD

Shout out to Sarah.

The Big Question

What should a little electric Ford truck look like? How small is too small?