“It’s the most humbling thing I’ve ever seen,” Farley said, speaking of his trips to China at the Aspen Ideas Summit on Friday. During an interview with the journalist Walter Isaacson, Farley said he’s been to China six or seven times in the past year to scope out the competition.
One of his big takeaways is the advanced tech in those vehicles. “They have far superior in-vehicle technology,” Ford’s CEO said.
The entire auto industry has talked a big game for years about developing “smartphones on wheels” or, to use an industry buzzword, “software-defined vehicles.” A few, like Tesla, have successfully made cars that act and feel like consumer devices—vehicles with lots of tech features, smooth digital interfaces and a steady stream of meaningful software updates. Most are playing catch-up.
As Farley tells it, Chinese firms have taken the in-vehicle digital experience up several notches, something our staff has noticed during visits to the country too. In the U.S., “technology” in most cars amounts to a media player, a navigation system and maybe some smart cruise control. China has pushed the envelope far beyond that.
“Huawei and Xiaomi are in every car,” Farley said, referring to two of China’s tech giants. “You get in, you don’t have to pair your phone. Automatically, your whole digital life is mirrored in the car. You have an AI companion that you can talk to … All the automatic payment is already there. You can buy movie tickets. It has facial recognition so it knows who’s in which seat and which media you like.”
The challenge for Ford and other automakers outside of China goes far beyond AI assistants. Thanks to massive government subsidies, vertical integration and other factors, Chinese firms have built up immense EV manufacturing scale and driven costs down. What’s perhaps even more worrisome to carmakers trying to compete with Chinese offerings in markets around the world: The cars may be cheap, but they don’t feel like it.
“And even beyond that, their cost, their quality of their vehicles is far superior to what I see in the West,” Farley continued. “We are in a global competition with China, and it’s not just EVs. And if we lose this we do not have a future at Ford.”
BYD, China’s biggest EV maker, famously sells the Seagull hatchback for under $10,000 domestically. It costs around $26,000 in Europe, where it recently debuted. Meanwhile, most automakers around the world are still struggling to scale up EV production, bring down high battery costs and turn a profit. To be sure, many analysts say the price war going on in China’s car industry is unsustainable—that this oversaturated market is bound to see some consolidation as smaller players collapse.
Still, the challenge remains: China’s car companies are building top-tier cars, they’re edging out foreign car companies from their home market and they’re expanding globally. Right now, high tariffs are keeping them at bay in the U.S., but auto executives expect Chinese cars to hit American shores sooner or later.
So what’s Ford doing to manage the situation? It’s learning from China, first off. Farley said he brings his whole leadership team on his trips to the country, where they drive as many of the latest cars that they can.
“Then we pick the four or five that we love and then we put them on a plane and fly them to Detroit. And then we drive the cr-p out of them, and then we take them apart and we put them back together,” he said. Previously, he said he loved driving the Xiaomi SU7, essentially China's version of the Apple car that never was.
Ford is also working on a $30,000 electric car that Farley called “the Model T of EVs.” It’s building up manufacturing of cheaper lithium iron phosphate, or LFP, batteries in Michigan through a licensing agreement with China’s CATL. That partnership has been mired in political controversy, but Ford argues it’s necessary to build affordable EVs in America.
“People don’t realize that China has IP that America needs,” he said. “I think we just need to be more humble as a country that they do things really well, that we need to learn.”
18 replies (most recent on top)
An implication of Farley’s message is that Ford’s business interests are very oriented towards China. I think the geopolitical risks of this orientation are high, especially for Ford investors, employees, communities, customers, etc.
Does anyone know why Ford uses synchronous electric motors with Chinese made rare earth magnets? There is a lot of geopolitical risk using these magnets. After the Chinese embargo of rare earth magnets in 2011 Japanese companies developed switched reluctance and induction motors that don’t need magnets.
Ford stop fighting the Trump administration. Get in line or shut down.
https://www.zerohedge.com/markets/japan-finally-admits-its-carmakers-have-been-paying-all-trump-tariff-costs-trade-talks
"leave people locked in their own cars"
This is literally the recent Mach E recall.
One of the things I see about the Chinese auto factories is there are surprisingly few people.
Ford is getting their ars kicked for CAFE. They Canceled cars and now the small and midsize SUVs. The only chance they have now is dump small EVs on the market. Thus a possible Chicom connection. Expect a rebadged Chicom BEV with a Ford emblem in the near future.
BOD including Billy should resign but first fire Fartley
$30K is the cheap car? Here I thought we were gonna do something that would drive sales.
Been there, don't know what he's talking about. Shoddy quality, EV fires, dodgy safety standards, system failures that leave people locked in their own cars. Maybe he thinks that is impressive. What a hack.
https://insideevs.com/news/764318/ford-ceo-china-evs-humbled/
F communist China, JF! US does not want EVs. You tried forcing EVs on the market and blew 15 billion and counting. Sounds like your next job will be with a Chicom company or maybe Ford will join forces with BYD since Billy has the IQ of a turnip.
Why can't Ford make a reliable inexpensive car after 120 years in the business ? everything they make is expensive junk loaded with defects
Just because the Chinese want cars like that doesn't mean Americans want cars like that. Does Farley really think the average blue collar American buying a work truck cares if their truck has facial recognition and the ability to buy movie tickets? He needs to be fired.
@ac It has facial recognition so it knows
and your government knows too
“You get in, you don’t have to pair your phone. Automatically, your whole digital life is mirrored in the car. You have an AI companion that you can talk to … All the automatic payment is already there. You can buy movie tickets. It has facial recognition so it knows who’s in which seat and which media you like.”
I nor anyone I know wants this cr-p.
China is able to produce cheap cars, due to dirt cheap labor, subsidies and lax regulations, none if that possible here, any volunteers to cut paycheck to 1/3 of the value?
maybe dont cancel the car we were making that had all that jim?
Can't wait to buy my first reliable inexpensive Chinese car and watch Detroit finally go out of business for good
We are pretty much fu---d.
We were milking ICE for a while and now they control 75% of global EV sales (2024 numbers, 2025 will probably be 80%+).
They are pushing 700 miles in range on sedans, they are upping this 15+ every year, they will be in a 1000 mile range by the end of the decade.
NIO ET7 650 miles range, Yuanhang Y7 and Y6 630 mi, Yangwang U7 450 mi, Hongqi EH7 Pro+ 407 mi, I am sure I am missing many here as they have a slew of things with 400+ miles range in a $25K range.
Now, pickups have not been solved yet, but they are working on it...
They have 4 companies that solved self-drive, here we just have Tesla with half assed attempts to do something in this space and poor Waymo doing circles in select city centers...
We'll stay around but we'll just be less relevant. We can play this game only if we can transform to be a $20K/car company and to make up things on volume but the US has space for one, maybe two players at this price point.
As I said above, we are all fu---d.
“The Chinese are the major threat right now.”
– Carlos Tavares, CEO, Stellantis (MotorTrend, Feb 2024)
“Tariffs on Chinese vehicles… are a major trap… try to be Chinese ourselves.”
– Carlos Tavares, CEO, Stellantis (Reuters, Sep 26 2024)
“It has become a race to the bottom with pricing and the level of subsidies.”
– Mary Barra, CEO, General Motors (Electrek, Oct 17 2024)
“The Western auto industry is now locked in a ‘Darwinian’ make‑or‑break battle with China.”
– Ola Källenius, CEO, Mercedes‑Benz (BusinessInsider, Oct 2024)
“And the window is closing… if we are not fast… it will be really tough… to survive.”
– Thomas Schmall, Board Member, Volkswagen (Reuters, May 23 2024)
“We want fair competition with China. But this is not fair.”
– Luca de Meo, CEO, Renault (Le Monde, Mar 19 2024)
“China poses an ‘existential threat.’”
– Unnamed engineering/executive (Forbes, Jun 5 2025)
“China’s rapid ascent … has shaken market leaders … setting a new standard.”
– Industry analyst (Axios, Jun 25 2025)
“Chinese EV makers make electric vehicles for about a third less.”
– Carlos Tavares, CEO, Stellantis (Reuters Events, May 2024)
“European automakers… have two or three years… if we are not fast…it will be really tough (for [us]) to survive.”
– Thomas Schmall, Board Member, Volkswagen (Reuters, May 23 2024)