“Ford CEO Jim Farley predicts electric cars won’t reach cost parity with combustion engines until 2030”

Electric cars may not reach cost parity with vehicles powered by internal combustion engines until after 2030, Ford CEO Jim Farley said on Wednesday, Reuters reports.

Speaking at an investor conference, Ford’s boss said electric vehicles will continue to be more expensive than those with internal combustion engines until the second and third generation vehicles enter production after 2025.

Between 2030 and 2035, Farley added, most of the cost savings in electric vehicles will come “from a significant reduction in headcount” as the vehicles will be simpler to produce, with fewer components and equipped with smaller batteries that use cheaper materials.

Also, the head of Ford predicted a decrease in distribution costs, following the online sales of electric cars.

Farley announced that Ford’s software services division now has more than 600,000 subscribers, triple the number of last year. As the company expands its capabilities to collect data from vehicles and drivers, it is normal to increase Ford’s software services division, Farley pointed out.

Asked about potential consolidation in the auto industry over the next five years, Farley predicted “an acceleration of cooperation,” citing deals such as the recent deal that will see Ford use Tesla’s charging network for its future electric vehicles.

“Collaboration is essential, especially for companies that may not have the resources to produce a full ecosystem of electric vehicles,” said the Ford boss.

The company recently announced that it expects an adjusted operating profit of between 9 and 11 billion dollars this year. The figure includes an anticipated $3 billion loss at the electric vehicle division.

In the first quarter of 2023, Ford lost more than $60,000 per electric vehicle sold.

The American car manufacturer has three divisions: Ford Model e (electric vehicles), Ford Blue (combustion vehicles) and Ford Pro (commercial and service vehicles).