'Colossal Strategic Threat:' Ford EV Exec Says 'We'd Better Get Fit Now' On Chinese Rivalry After BYD Comes Knocking Closer Home

Dearborn-based legacy automaker Ford Motor Co F reportedly deems Chinese electric vehicle makers a looming threat that will eventually threaten their business in the United States.

What Happened: During a panel discussion on disruptive technology in Detroit, Ford’s EV unit’s chief operating officer Marin Gjaja termed Chinese EV makers a “colossal strategic threat,” Bloomberg reported.

Gjaja reportedly noted at the discussion that Chinese EV makers are ahead of their U.S. counterparts in technology and will eventually get around the heavy tariffs of 25% imposed by the U.S. on EV imports from China by buying factory space in Mexico.

"We look at that (Chinese EVs) and say, ‘That's coming here eventually, so we'd better get fit now and better get going on EVs or we don't have a future as a company,” Gjaja said.

Mexico, the executive noted, has a supplier base, low cost of construction and labor, and a trade agreement that gives one access to the U.S. market. Gjaja also referred to media reports of Chinese EV giant BYD Co Ltd BYDDY eyeing a factory in Mexico.

"They're going to come here, just as the Japanese ended up here, the Koreans ended up here and the Germans ended up here. It's a big market,” Gjaja reportedly said.

Why It Matters: During Ford’s fourth-quarter earnings call earlier this month, company CEO Jim Farley said that the company’s EV teams are currently focused on cost and efficiency to withstand “ultimate competition” from American EV giant Tesla Inc and other Chinese EV makers who have more affordable offerings.

The company developed a "super-talented skunkworks team" to create a low-cost EV platform two years ago and they have developed a flexible platform that will be deployed to several types of vehicles, Farley then said.

Even Tesla CEO Elon Musk earlier this month said if not for trade barriers Chinese EV makers “will pretty much demolish most other car companies in the world."

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Photo courtesy: Ford