Ford CEO Jim Farley has voiced concerns about the global auto industry, pointing out that Chinese EV makers are developing at a quick pace and that this presents a threat to the American car makers.
“It’s the most humbling thing I’ve ever seen,” Farley said during a lecture at the Aspen Institute’s Aspen Ideas Festival. According to him, Chinese vehicles have gained popularity due to their affordability compared to European and American electric vehicles (EVs).
Due to their aggressive international expansion and superior technological integration, Farley referred to the emergence of Chinese electric vehicle manufacturers as an “existential threat” to the U.S. car industry, endangering the market share of established automakers.
“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.”
Chinese manufacturers are controlling the market by utilizing cutting-edge technology like artificial intelligence and low-cost supply networks, with competitively priced and advanced vehicles.
Car manufacturers like Tesla have been concentrating on building “smartphones on wheels” or “software-defined vehicles,” which resemble consumer electronics. Still, the majority of companies are lagging behind.
With media players, navigation systems, and smart cruise control that outperform US standards, Chinese companies have greatly enhanced the in-car digital experience. Chinese companies are pushing the limits of technology, which has caused the automobile sector to shift its focus to software-defined vehicles.
“Huawei and Xiaomi are in every car,” Farley said, “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.”
Chinese automakers, such as BYD and Xiaomi, have significantly impacted the electric vehicle (EV) market, both domestically and internationally. These companies have gained ground due to lower prices, advanced interiors, and the ability to rapidly iterate and release new models, expanding their influence beyond China, quickly penetrating markets in Europe, the Middle East, and Asia.
Chinese automakers have faced significant barriers in entering the U.S. market, including steep tariffs, geopolitical tensions, and complex regulatory requirements. However, they have made inroads in neighboring Mexico, where vehicles built in China account for about 20% of sales.
“People don’t realize that China has IP that America needs,” Farley stated said. “I think we just need to be more humble as a country that they do things really well, that we need to learn.”
