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Why Ford’s Small Electric Vehicle Platform Makes Sense

Ford stunned us earlier this year when it confirmed it had a skunkworks team in California working on a new platform for smaller and more affordable electric vehicles.  That was followed by reports that this project had become a priority, to the detriment of some larger EVs already in the works. We got more explanation from Ford chief financial officer John Lawler on why this pivot makes sense. Lawler was a speaker at the Bank of America Securities Auto Summit.

The genesis of the project dates, in part, back to a visit to China by Lawler and Ford CEO Jim Farley last year, where they saw the quality of the products coming from Chinese companies and a speedy development process that put traditional automakers at a competitive disadvantage. And it also stems from Farley’s fervent belief that the key to growing EV sales is affordable vehicles.

oss Out Old Ideas About EV Profitability

When it comes to EVs, past beliefs and practices must be tossed out the window. The long-held business model for vehicles with internal combustion engines is that the larger the vehicle, the greater the return on revenue and profitability. Small vehicles can even be loss leaders, meaning they draw customers into the showroom and the brand at a loss in the hopes they become longtime loyal buyers of larger, more profitable models. It is the same premise as convenience stores selling milk at a loss in the hope the customer also grabs gas, lottery tickets, snacks and beverages.

Here is where EVs turn that upside down. The most expensive part of an electric vehicle is the battery. Smaller EVs need smaller batteries which not only reduces cost but also weight, which in turn increases range. Affordability and efficiency improve in one fell swoop.

But Americans Like Big Vehicles

The other truism in North America, is that customers want large vehicles. But Lawler says the new platform is flexible enough to cover vehicles over a wide swath of segments. And the crucial point: EVs with their flat floors and no need for an engine, transmission tunnel and other large and bulky components, make it possible to offer a lot more interior space. It means Ford can offer an SUV that is the size of a Ford Escape on the outside but with the interior space of a Ford Explorer; and an Explorer footprint can provide the cabin space of a fullsize Expedition, Lawler said.

“The game won’t be fought and won with larger vehicles,” said Lawler, but instead with smaller and more affordable ones.

The new platform started as a skunkworks project in California about two years ago, led by former Tesla engineer Alan Clarke and some of his recruits. But it is very much a core project, overseen by Chief Advanced Product Development and Technology Officer Doug Field.

Evolution of Ford’s EV Platforms

Ford’s first-generation of EVs spawned the Ford Mustang Mach-E, Ford F-150 Lightning, and Ford E-Transit commercial van.

Ford almost immediately began work on a second-generation platform for the next iteration of electric pickup trucks—Lawler said he is not sure it will continue to be called Lightning—as well as other large vehicles, starting in 2026. That was to include electric versions of the vehicles similar in size to the Ford Explorer and Lincoln Aviator which were to come from the retooled Oakville Assembly Plant in early 2025, but those plans have changed. Ford will have large EVs from this platform, but it will be limited in the number of top hats it produces, Lawler said.