Transportation

Ford delays new EVs once more, showing why legacy automakers need to adopt a startup mentality

Comment

tesla-ford-charger
Image Credits: Ford

Ford announced Thursday that it’s delaying the production of two electric vehicles, a next-generation EV pickup and a three-row EV SUV. The pair are now slated to arrive in 2026 and 2027, delays of one and two years respectively. In their place, the automaker will be introducing hybrids across its U.S. lineup.

Ford’s CEO has been telegraphing the delays for months. Last fall, it postponed $12 billion in planned investments. Then on an earnings call in February, CEO Jim Farley said, “Hybrids will play an increasingly important role in our industry’s transition and will be here for the long run.” That’s the sort of sober talk that shareholders love to hear.

Wall Street is likely to cheer the move, especially after Toyota reported that its year-over-year sales in the United States rose 22% on the back of strong demand for hybrids. Ford’s shift appears designed to bolster cash flow and near-term profits, something that seems logical for a company of its size, especially in times of uncertainty.

But here’s the thing: Ford is unusual among established automakers in that it performs best when thinking like a startup, something it appears to have taken to heart more recently, EV delays notwithstanding. It succeeds better when it shapes the market than when it responds to it.

Most recently, that startup mentality was on display with the Mustang Mach-E, Ford’s all-electric crossover. When the EV started taking shape nearly a decade ago, the original plan was to build a perfectly sensible crossover powered by an electric motor at the front. The design was aerodynamic, but so uninspiring that one of the company’s exterior designers questioned who would buy it. Judging by the look of the proposed design, those doubts were understandable.

But then-CEO Jim Hackett scrapped the plan and gave the team just two years to come up with something new. The result was a crossover that has helped Ford claim second place in U.S. EV sales for several quarters in a row.

The Mustang Mach-E wasn’t a fluke. Ford has a record of pulling rabbits out of the hat. In the 1980s, when American automakers were getting shellacked by Japanese imports, Ford ditched its boxy, heavy designs and conjured up the Taurus, which went on sale in late 1985. The sleek, roomy and affordable car was unlike anything American consumers had seen, and it was an immediate hit. Ford sold 1 million of them in the first three years, a success that likely saved the company from bankruptcy.

Five years later, Ford again pivoted with the introduction of the Explorer. SUVs were nothing new, but at the time most were two-door models focused on utilitarian qualities like towing and off-roading. Cars remained the dominant choice among consumers. But by adding rear doors and a raft of creature comforts, Ford transformed the SUV into a family-friendly hauler. It might have cannibalized sales of the company’s cars, but the decision to launch the Explorer proved prescient: Not only did it power another decade of growth for the company, it predicted a world where SUVs dominated the market.

There are other examples, too: Ford used a fast-and-lean approach when developing the original Mustang, allowing it to define an entirely new category of fast, expensive “pony cars.” It did the same after World War II when it produced what’s now known as the ’49 Ford, a car that broke with styling conventions and pushed the automaker back into the sales lead. And don’t forget the original Ford assembly line, which while not a product, was definitely a product of entrepreneurial thinking.

Farley faces different challenges today. His predecessors were basically mixing and matching designs, platforms and manufacturing techniques while the heart of each of those vehicles, the engine, remained largely the same. Electric vehicles challenge manufacturers to start with a clean slate, or at the very least rip out that heart without losing what made the original vehicle so great.

Ford has excelled at those tasks: The Mustang Mach-E and the F-150 Lightning are by most accounts not just excellent EVs, but excellent vehicles overall.

Still, they haven’t been the runaway successes that Ford expected. That’s in part because they were too expensive — price cuts have proven there’s still demand for them — and also because the charging infrastructure to support them remains underdeveloped. If charging is preventing Ford from selling more EVs, maybe it needs to address the problem head on. And if it can’t price its EVs competitively and still make a profit, maybe Ford needs to find a cheaper way to manufacture them.

The company has already started down the path, forming a skunkworks led by ex-Tesla executive Alan Clarke to develop a low-cost EV. If the team succeeds in bringing a product to market, some of that startup spirit might be alive at Ford after all.

More TechCrunch

Welcome back to TechCrunch’s Week in Review. This week had two major events from OpenAI and Google. OpenAI’s spring update event saw the reveal of its new model, GPT-4o, which…

OpenAI and Google lay out their competing AI visions

Expedia says Rathi Murthy and Sreenivas Rachamadugu, respectively its CTO and senior vice president of core services product & engineering, are no longer employed at the travel booking company. In…

Expedia says two execs dismissed after ‘violation of company policy’

When Jeffrey Wang posted to X asking if anyone wanted to go in on an order of fancy-but-affordable office nap pods, he didn’t expect the post to go viral.

With AI startups booming, nap pods and Silicon Valley hustle culture are back

OpenAI’s Superalignment team, responsible for developing ways to govern and steer “superintelligent” AI systems, was promised 20% of the company’s compute resources, according to a person from that team. But…

OpenAI created a team to control ‘superintelligent’ AI — then let it wither, source says

A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to…

VCs and the military are fueling self-driving startups that don’t need roads

When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying…

Deal Dive: Sagetap looks to bring enterprise software sales into the 21st century

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: OpenAI moves away from safety

After Apple loosened its App Store guidelines to permit game emulators, the retro game emulator Delta — an app 10 years in the making — hit the top of the…

Adobe comes after indie game emulator Delta for copying its logo

Meta is once again taking on its competitors by developing a feature that borrows concepts from others — in this case, BeReal and Snapchat. The company is developing a feature…

Meta’s latest experiment borrows from BeReal’s and Snapchat’s core ideas

Welcome to Startups Weekly! We’ve been drowning in AI news this week, with Google’s I/O setting the pace. And Elon Musk rages against the machine.

Startups Weekly: It’s the dawning of the age of AI — plus,  Musk is raging against the machine

IndieBio’s Bay Area incubator is about to debut its 15th cohort of biotech startups. We took special note of a few, which were making some major, bordering on ludicrous, claims…

IndieBio’s SF incubator lineup is making some wild biotech promises

YouTube TV has announced that its multiview feature for watching four streams at once is now available on Android phones and tablets. The Android launch comes two months after YouTube…

YouTube TV’s ‘multiview’ feature is now available on Android phones and tablets

Featured Article

Two Santa Cruz students uncover security bug that could let millions do their laundry for free

CSC ServiceWorks provides laundry machines to thousands of residential homes and universities, but the company ignored requests to fix a security bug.

2 days ago
Two Santa Cruz students uncover security bug that could let millions do their laundry for free

TechCrunch Disrupt 2024 is just around the corner, and the buzz is palpable. But what if we told you there’s a chance for you to not just attend, but also…

Harness the TechCrunch Effect: Host a Side Event at Disrupt 2024

Decks are all about telling a compelling story and Goodcarbon does a good job on that front. But there’s important information missing too.

Pitch Deck Teardown: Goodcarbon’s $5.5M seed deck

Slack is making it difficult for its customers if they want the company to stop using its data for model training.

Slack under attack over sneaky AI training policy

A Texas-based company that provides health insurance and benefit plans disclosed a data breach affecting almost 2.5 million people, some of whom had their Social Security number stolen. WebTPA said…

Healthcare company WebTPA discloses breach affecting 2.5 million people

Featured Article

Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Microsoft won’t be facing antitrust scrutiny in the U.K. over its recent investment into French AI startup Mistral AI.

2 days ago
Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Ember has partnered with HSBC in the U.K. so that the bank’s business customers can access Ember’s services from their online accounts.

Embedded finance is still trendy as accounting automation startup Ember partners with HSBC UK

Kudos uses AI to figure out consumer spending habits so it can then provide more personalized financial advice, like maximizing rewards and utilizing credit effectively.

Kudos lands $10M for an AI smart wallet that picks the best credit card for purchases

The EU’s warning comes after Microsoft failed to respond to a legally binding request for information that focused on its generative AI tools.

EU warns Microsoft it could be fined billions over missing GenAI risk info

The prospects for troubled banking-as-a-service startup Synapse have gone from bad to worse this week after a United States Trustee filed an emergency motion on Wednesday.  The trustee is asking…

A US Trustee wants troubled fintech Synapse to be liquidated via Chapter 7 bankruptcy, cites ‘gross mismanagement’

U.K.-based Seraphim Space is spinning up its 13th accelerator program, with nine participating companies working on a range of tech from propulsion to in-space manufacturing and space situational awareness. The…

Seraphim’s latest space accelerator welcomes nine companies

OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models. In a blog post on OpenAI’s press relations site, the company said…

OpenAI inks deal to train AI on Reddit data

X users will now be able to discover posts from new Communities that are trending directly from an Explore tab within the section.

X pushes more users to Communities

For Mark Zuckerberg’s 40th birthday, his wife got him a photoshoot. Zuckerberg gives the camera a sly smile as he sits amid a carefully crafted re-creation of his childhood bedroom.…

Mark Zuckerberg’s makeover: Midlife crisis or carefully crafted rebrand?

Strava announced a slew of features, including AI to weed out leaderboard cheats, a new ‘family’ subscription plan, dark mode and more.

Strava taps AI to weed out leaderboard cheats, unveils ‘family’ plan, dark mode and more

We all fall down sometimes. Astronauts are no exception. You need to be in peak physical condition for space travel, but bulky space suits and lower gravity levels can be…

Astronauts fall over. Robotic limbs can help them back up.

Microsoft will launch its custom Cobalt 100 chips to customers as a public preview at its Build conference next week, TechCrunch has learned. In an analyst briefing ahead of Build,…

Microsoft’s custom Cobalt chips will come to Azure next week

What a wild week for transportation news! It was a smorgasbord of news that seemed to touch every sector and theme in transportation.

Tesla keeps cutting jobs and the feds probe Waymo