Tesla is now a $100 billion “tech” company, while Volkswagen CEO Dr. Herbert Diess says “the time of traditional car manufacturers is over,” and GM’s Cruise just unveiled its Origin robotaxi. This is going to be the electric decade, literally and figuratively, where three forces — the traditional car manufacturers and suppliers, the upstarts like Tesla, NIO and tech companies will cooperate, compete and form a new ecosystem that we cannot yet define.
Another “Tesla killer” has just arrived.
Ford’s unveiling of the all-new all-electric Mustang Mach-E prior to the start of last year’s Los Angeles Auto Show in November marked a critical moment not only in the storied history of the 116-year old automaker and the 55-year old iconic Mustang nameplate, but also the electrification efforts of the entire global auto industry.
In one of the most anticipated new product reveals in recent memory, Ford put the industry on alert: the Blue Oval is as much about electrification as it is about pickups, SUVs and muscle cars. Ford finally has an electric model in its stable that not only looks original, nice and sporty on the outside with its Mustangy genes but just as modern as far as HMI, connectivity and hi-tech features are concerned, putting it squarely against leading innovators in the field such as Tesla and some of the Chinese smart EV startups like NIO. The chess move was a bit late, coming nearly a decade after Ford unveiled the Focus Electric at the Detroit Auto Show in January 2010, which later flopped. But it was certainly close to a check mate.
Tesla CEO Elon Musk even congratulated the unveiling of the Mustang Mach-E, which had an eerily similar look to the Model Y and a Tesla-esque 15.5-inche screen, saying on twitter: “Sustainable/electric cars are the future!! Excited to see this announcement from Ford, as it will encourage other carmakers to go electric too.”
While the Mustang Mach-E won’t come to the Chinese market until 2021, China already played a big role in its development. Darren Palmer, Ford Global Product Development Director in charge of Ford and Lincoln Battery Electric Vehicles, told some of the Chinese media after the unveiling that within two weeks of the establishment of Team Edison in 2017 after Jim Hackett was appointed as Ford President & CEO, the team chose China to visit first in a global tour to help develop the Mustang Mach-E. Some of the companies visited included Tencent, Alibaba and NIO. The 15.5-inch screen and HMI features, in fact, were inspired by Chinese consumer needs.
The Mustang Mach-E debut capped what was a busy November in the race to electrify the industry: the start of production of the ID.3 at Volkswagen’s Zwickau plant on November 4, the debut of the Shanghai-made Tesla Model 3 on November 7, the start of pre-production of the ID.Chujian (First) at SAIC-Volkswagen and the market launch of the locally-built Mercedes-Benz EQC on November 8, Evergrande’s announcement of a three-year ¥45 billion investment in the NEV game on November 12, Volkswagen Group’s announcement of a €60 billion investment in electromobility and digitalization by 2024 on November 15 and the China launch of the imported Audi e-tron on November 18, just to name a few.
All this coming ahead of the LA Auto Show and Auto Guangzhou 2019, where more EVs and electrification plans were announced, and against the backdrop of four consecutive months of negative growth in NEV sales in China.
An interesting irony coming at an interesting time as China gets closer to the expiration of NEV subsidies at the end of 2020.
The only questions that remain are, can the leading incumbents in China, mostly Chinese brands that have reaped the benefits of these subsidies, stand their ground in the NEV game, and can the late charge from foreign automakers in electrification translate to success in the world’s largest NEV market?
Something’s got to give.
