Ford: the US Can't Compete With China on Electric Vehicles, for Now
"We need to be ready, and we're getting ready":
Bill Ford, executive chairman of Ford Motor Company, has warned that when it comes to the production of electric vehicles, the United States is still not ready to compete with China. Speaking about China's EV industry during an interview with CNN's Fareed Zakaria GPS, Ford said "They developed very quickly, and they developed them in large scale. And now they're exporting them [...] They're not here but they'll come here we think, at some point, we need to be ready, and we're getting ready."
The US automaker in February announced that it would be investing $3.5 billion in building an electric vehicle plant in Michigan. Reuters writes that the deal will use technology from Chinese battery company Contemporary Amperex Technology Co. Ltd, which led to Senator Marco Rubio asking the Biden administration to review the deal. Ford says the Michigan battery plant is a chance for Ford engineers to learn the technology and use it for themselves.
"It [Michigan] is a wholly owned Ford facility. They'll be our employees, and all we're doing is licensing the technology. That's it." Ford said.
[...] Buttigieg added that the US must build relationships domestically and internationally for raw materials and refining capacity. Chinese firms make up more than half of the EV battery market and provide as much as 90% of the demand for some battery materials.
Ford Gets $9.2B Department of Energy Loan to Build 3 EV Battery Plants
The conditional loan will help Ford reach its goal to produce 2 million EVs annually by 2026:
Ford has received a conditional loan of $9.2 billion from the US Department of Energy to help it construct three plants that will produce batteries for future Ford and Lincoln electric vehicles.
The loan for the American car manufacturer will help the US reach net zero electricity by 2035, and have EVs make up half of all new car sales by 2030, the Energy Department said.
The loan will be provided to BlueOval SK, or BOSK, a joint venture between Ford and SK On, a South Korean-based EV battery manufacturer.
[...] BOSK is building one EV battery plant in Tennessee and two in Kentucky, with battery production scheduled to begin in 2025.
Related Stories
Battery maker LG Energy Solution's second-quarter profit dropped 58% year-on-year to 195.3 billion won ($141m), the company said on Monday (8 July), as demand for electric vehicles (EVs) slows:
The South Korean-based battery company also saw its revenue drop 30% to 6.2 trillion won ($4.4bn).
The company also faces increased competition from its Chinese rivals, which has weakened its share of the market.
Car manufacturers have been calling for battery companies to create cheaper cells to lower EV prices, which has applied pressure to companies like LG Energy.
This led to LG Energy's chief technology officer, Kim Je-Young, stating that the company would commercialise dry-coating technology by 2028, a technology which makes battery manufacturing cheaper and more efficient.
Battery maker SK On declares 'emergency' as EV sales disappoint. Supplier to Ford and Volkswagen may have to be rescued by its South Korean parent as losses mount:
A leading South Korean producer of electric vehicle batteries has declared itself in crisis as its customers struggle with disappointing EV sales in Europe and the US.
SK On, the world's fourth-largest EV battery maker behind Chinese giants CATL and BYD and South Korean rival LG Energy Solution, has recorded losses for 10 consecutive quarters since being spun off by its parent company in 2021. Its net debt has increased more than fivefold, from Won2.9tn ($2.1bn) to Won15.6tn over the same period, as western EV sales have fallen far short of its expectations.
With losses snowballing, chief executive Lee Seok-hee announced a series of cost-cutting and working practice measures last Monday, describing them as a state of "emergency management".
[...] SK On has made a series of aggressive investments in the US and Europe in recent years, betting on a widely predicted boom in demand for EVs. However, it has since announced extended lay-offs for workers at its plant in the US state of Georgia and delayed launching a second plant in Kentucky, a joint venture with its principal US customer Ford.
Previously:
- LG Energy Solution to Spend $3 Billion to Expand EV Battery Production in South Korea
- Honda and LG are Investing $3.5 Billion in New Ohio Battery Factory
- Ford Motor Company is Planning a Big EV Future
(Score: 1, Insightful) by Entropy on Tuesday June 27 2023, @05:58AM
Really? Ask the Biden administration to review a deal with China? I guess he has experience.
"Chinese battery company Contemporary Amperex"
"asking the Biden administration to review the deal"
(Score: 2) by Rosco P. Coltrane on Tuesday June 27 2023, @08:11AM (3 children)
In other words: steal the technology.
You know the US technological leadership is about to be unceremoniously flushed down the crapper when Republican politicos switch from constantly accusing China of IP theft to advising domestic manufacturers to engage in it too.
(Score: 3, Informative) by khallow on Tuesday June 27 2023, @12:40PM
There are legal ways to "steal the technology". Such as paying someone a bunch of money to share the technology with you and let your people work with it. And STEM education is all about sharing knowledge.
(Score: 1, Interesting) by Anonymous Coward on Tuesday June 27 2023, @01:42PM
There's a learning curve to making Li-ion batteries, if Ford can license some technology, it could save them some startup time. Here's a recent article about setting up a battery production line, https://www.techbriefs.com/component/content/article/tb/supplements/bet/features/articles/48225 [techbriefs.com] viewed by a supplier of modeling software to simulate the production process.
Then later they say,
Based on some limited understanding of machining (for example), it's typical to drive scrap to near-zero in many manufacturing processes. The idea of driving around with batteries made in a plant with 10% scrap rate isn't very appealing--what are the chances of getting some cells that "just" passed QC? Maybe others on SN know more about battery making, but to me this sounds like a process that is still "not controlled".
(Score: 2) by bryan on Tuesday June 27 2023, @02:20PM
South Korean, not Chinese.
(Score: 2, Interesting) by DadaDoofy on Tuesday June 27 2023, @04:09PM (3 children)
Who is really running things at Ford? They've lost 3 billion dollars a year for the past two years on their EV business and have projected they will lose another 3 billion this year. As companies are exiting China like rats from a sinking ship, why would they risk tying their future to the uncertainty of such a partnership?
(Score: 2, Insightful) by Cyrix6x86 on Tuesday June 27 2023, @04:22PM
Maybe Ford still wants to be around in 40 years.
It's not always about short term profits.
(Score: 2) by RS3 on Tuesday June 27 2023, @04:49PM
Not even close to expert here, but a friend who's had a Bolt (EV) for 5 years says the auto makers have to satisfy US govt. requirements for emissions, carbon, mpg, etc., and that EVs are a loss but 1) necessary and 2) a writeoff, for now.
(Score: 3, Interesting) by ledow on Wednesday June 28 2023, @08:24AM
Because by 2030 or 2035, internal combustion engines will not be legal to sell in most of the world.
I'm guessing they are trying to get tooling, development and manufacture ready for when their CORE BUSINESS disintegrates under their nose with almost no possibility of reprieve.
Anything else would be doing a Kodak - ignoring digital photography entirely until it's too late and literally tanking a 130 year old company through hubris.
Given that ALL their competitors are having to do the same thing, at the same time, maybe they want to tap into some expert knowledge in what HAS to be their new core business in only a few year's time and keep up to speed.
To be honest, if anything, they're slow. Like all the other ICE manufacturers. They've paid only lip-service to electric car production thus far and likely several big names will disappear because of failing to keep up.
Lose $1.5bn, $3bn a year? Or lose your entire income globally within maybe 7-12 years because you never got on board and didn't want to take a risk?
Until very, very, very recently Ford produced more cars in a year than Tesla had in its entire existence. Ford's R&D swamps Tesla's ability. Ford can afford to lose $3bn a year on a side-venture to their (current) main business. Just not forever.
What they *can't* afford to do is become another Kodak in denial and not get on board with electric car manufacture.
By the time they get the expertise on-board, do proper design and testing, design, build and test their new factories and processes, and actually get to the point of making a range of production EVs and producing them in such numbers as they currently make ICE vehicles, using the information they glean from this venture? They are going to be scarily close to an almost-worldwide ban on their current core product.
(Score: 3, Insightful) by bzipitidoo on Tuesday June 27 2023, @04:15PM (6 children)
They're still not quite at parity with internal combustion engine cars. They can't do near continuous use. While long trips are possible with the better ones, they're slower. You also can't forget to charge up well before you leave. Rushing to work in the morning and only then realizing you're low on fuel is no big deal in a gas powered vehicle, but with an electric, you're going to be more late.
One huge factor in making them more time consuming on long trips is that batteries can only be fast charged to 80%, while gas tanks are easily filled to 100%. BEV manufacturers' range claims are based on several impracticalities, and are therefore somewhat dishonest. Yes, if you could recharge to 100%, fast, then on a long trip you could get closer to the nominal range between rechargings. Another misleading factor is that the figures are based on running your energy supply down to nothing. No one is going to run their vehicle completely out of fuel, suffering the nerve wracking possibility of being stranded at the side of the road, wondering just how accurate the estimate of remaining fuel really is, just to extend their traveling a little further between refuelings. Besides which, does fast charging also have a lower limit of not being possible below 10%? There are two more problems with the range figures: they're predicated on not using A/C, and not driving very fast. I am not sure what speed they use, perhaps 70 mph, but it could be 60 mph/100 kph. (As all should realize, the #1 way in effectiveness to get more range is reduce air resistance by going slower. Going 30 mph gives a car noticeably more range than going 40 mph.) Yeah, in the US there used to be a national speed limit of 55 mph, but since that was changed in the late 1980s, speed limits have gone way up. Most faster roads allow 70 to 75 mph, and I know of a few roads that have limits of 85 mph. And many drivers still go 5 to 10 mph over the limit. All in all, for pretty much every BEV the usable range is half, just half, of the stated range.
Nevertheless, I am very much willing to live with the limitations for the sake of our health and environment. 3 hours for every 150 miles traveled (30 minutes to recharge and 150 minutes to cover the distance at an average speed of 60 mph) is certainly livable if definitely slower than a gas engine's ability to cover that 150 miles in 2.58 hours, assuming a 10 minute refueling stop every 300 miles. At 75 mph, it gets worse: 2.5 hours for the BEV, and 2.08 hours for the gas burner, assuming both can do so without refueling even more often.
One of the biggest things I like about BEV is no fumes. I also very much like the much lower maintenance requirements and costs. No more oil changes, air filter replacements, tuneups, annual emissions inspections, and all the other things a combustion engine needs. Now if only I could get the rest of the family to agree to this....
(Score: 2) by RS3 on Tuesday June 27 2023, @05:13PM (2 children)
All true and good points. I think, like almost everything discussed these days, there's no one simple obvious solution or "binary thinking" that can be applied.
Aforementioned guy I know who's had a Bolt EV for like 5 years owns his own house and garage and has a level 2 charger (40A 240V circuit). He plugs it in when he gets home. There's also a level 1 (120V 8 or 12 amps, selectable) charger with the car. When he goes on long trips, he plans so he stops where there are charging stations and he eats / does online work while it's charging. Point is, it's pretty useful overall.
Notice I said "garage". I've thought about people who don't have a garage or some other arrangement where they can have a charging station and have to go find one and wait. That's a limitation, but again, can be planned around.
All that said, I've always liked the idea of swapping battery packs. That might be the way of the future if enough manufacturers can agree on a standard.
My choice would be having both EV and ICE- "plug-in hybrid" they're often called. Best of both worlds.
(Score: 2) by requerdanos on Tuesday June 27 2023, @08:55PM (1 child)
Later this summer, I plan to drive from NC to FL (about 850 miles, 1370km) and back. I don't anticipate major problems doing so--in my gas-powered SUV. Taking an EV instead--assuming there are charging stations on the way, which is far from certain--would extend the time of the trip by quite a bit when charging time is considered, as it so often doesn't seem to be. If the trip could be done at all, given the need to stop and charge considered against the paucity of charging locations.
EVs have their use, but "replacing gas powered vehicles" does not yet appear to be one of them when considering long trips like this. I recommend rushing to extend infrastructure, not rushing to turn out more and more EVs against the weak and spotty infrastructure that's in place.
Note: I don't have a garage and I am not sure I would charge a giant lithium-ion battery in it if I did due to uncertainty about fire risk. This perhaps also needs some work where EVs are concerned. Another consideration.
Not that I am inherently against EVs--Go Detroit, beat China!--we just appear to be doing it wrong.
(Score: 2) by RS3 on Tuesday June 27 2023, @09:47PM
For years I've stayed out of most online conversations due to the too frequent caustic (flame) nature of many commenters. I don't mean to break my own rule, but you're taking it a bit too far. Most know that most things, especially any and all tech, are in development. You may not like the state of things now, but that doesn't mean it's being done wrong (despite what Jobs said about holding iPhones!)
A big problem is often the dynamic and fickle nature of markets. If everyone had your attitude, nobody would buy EVs, and that would end that hope for cleaner air. Fortunately people are buying (expensive!) cars like Teslas, meaning the market demand is there, and charging stations are being installed as we're reading and writing. Charging systems and plugs have not standardized, but that's being worked on, as I'm sure you've read, and more and more EV manufacturers are joining on to a standard charge port / plug design. Yay!
I totally agree with you- EVs are not for everyone, certainly not yet. My friend with the Bolt also bought a Chrysler Pacifica "plug-in hybrid". It runs on batteries- I think it's 60 miles or so, then the engine kicks in. They use it for long trips and it's perfect. If the EV battery is low, the engine runs and everyone is happy. As I wrote in my previous paragraph, I feel strongly that the combo EV + ICE is the way to go. If I was to buy something electric, that's what I would buy.
"plug-in hybrid" = ICE + EV all in one car.
I understand your worry about fire. Many years ago, long before EVs, my next door neighbors had a major car fire that took out part of their house. They rebuilt with a fully detached garage. My point is, it's not just EVs that are fire risk.
You'll love this: a couple of years ago, guy with Bolt asked me about unusual heating around where the charger plugs in (LF fender). Long story short- ended up being a serious problem, GM recall gave him a new battery.
(Score: 0) by Anonymous Coward on Tuesday June 27 2023, @10:06PM (2 children)
> At 75 mph, it gets worse: ...
During Covid, no one wanted to fly and I wound up being a "taxi" for my SO. The trip to her aging parent's house is very nearly 750 miles, crossing 6 states. I did the round trip at least a dozen times and unless we hit a slowdown (accident?) the trip took between 11 and 12 hours. This was with a car that averaged about 30 mpg for the trip. We stopped twice for gas (in states with low prices). Emptying nearly the full tank gave something over 400 miles range. Also, we stopped a few other times for a pee break. Lunch was sandwiches on the road.
A number of the trips were in cold weather where mileage gets a little worse...but range for EV's typically drops off significantly.
I don't think there are any current BEVs that could do that round trip in two days - one there, sleep overnight, back the next day. Given my work situation, doing the round trip over the weekend was often the only way it would work.
As others have commented, I'm not BEV-phobic, have driven several and they are fine...if you can afford to have a second car for local use only.
(Score: 2) by bzipitidoo on Wednesday June 28 2023, @12:07AM (1 child)
If long trips are infrequent, consider renting a gas burner for those, while keeping a BEV at home as the daily driver. Renting once or twice a year might well be cheaper than paying all the insurance, licensing fees, and maintenance costs to own a 2nd vehicle.
(Score: 0) by Anonymous Coward on Wednesday June 28 2023, @01:09AM
> Renting once or twice a year might well be cheaper...
It might, but not enjoyable. The last few times I've rented, the car I got had a damn big touch screen that kept me distracted from driving. It also had all kinds of "nanny" ADAS features (advanced driver assistance systems) that buzzed, pinged and sometimes even took over steering and/or braking. No thanks.
The newest car I have is 2014 and the only "advanced" control it has is ESC (stability control, tied to the antilock brakes). No screens, straightforward standard controls. And a central lever for the hand/parking brake. I'd say, "as God intended", but I'm also the resident post-theological...so I guess I'll just ask you kindly to get off my lawn(grin).