Ford Motor Co. F, which is currently ranked the number three player in the U.S. electric vehicle market, has set its sights on China, the world's second-largest EV market.
What Happened: "We're going to have to rethink what the Ford brand means in a place like China," said Ford CEO Jim Farley at a charity event in Detroit, Reuters reported.
He delved into the mushrooming competition in China, a "hot-and-happening" EV market. "It can't be like the middle of the market. It's totally over-filled," he reportedly said.
The executive said the only premium brands succeeding in the country were all-electric from the start, with a focus on technology, digital experience of drivers and services, the report said.
The differentiation is with respect to technology and services, he added.
Farley said Nio, Inc. NIO, XPeng, Inc. XPEV and Li Auto, Inc. LI were among the companies that were getting it right.
In China, there is intense competition in the market for two-row SUV-styled EVs, Farley reportedly said. This is the segment in which EV leader Tesla, Inc. TSLA competes with its Model Y vehicle. It is because of the overcapacity in the segment that most domestic EV makers are eyeing Europe, a premium export market, he added.
See Also: Best Electric Vehicle Stocks
BYD Is Impressive: Farley also reserved special praise for Warren Buffett-backed BYD Company Limited BYDDY BYDDF and lauded it for its vertical integration.
“There is one huge company that is so impressive, BYD. They’re in a totally different world than Tesla,” the Ford CEO.
“They’re totally vertically integrated, completely, all the way to batteries."
Why It's Important: Ford has a presence in China, although its performance leaves much to be desired. Its sales in the country comprise mainly its ICE vehicles. Data available from the company showed that its China sales fell 11% year-over-year in the third quarter of 2022.
Despite operating out of China for a long time and having a manufacturing plant in the country, Tesla hasn't been able to compete effectively with the domestic upstarts. Analysts say the absence of an ultra-affordable EV could be hurting the company.
Ford closed Wednesday's session 2.86% lower at $11.87, according to Benzinga Pro data.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Read Next: Tesla Takes The Crown, Ends Ford’s 12-Year Reign In Brand Loyalty For Vehicle Make
Photo: Courtesy of Ford Asia Pacific on Flickr
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