Ford quietly created its own “skunkworks” team to develop low-cost electric vehicles

Ford created a “skunkworks” lab two years ago with the mission of developing affordable electric vehicles, the company’s CEO said in an earnings call Tuesday. The team is being led by Alan Clarke, who worked at Tesla for 12 years before joining Ford as executive director of advanced EV development, according to TechCrunch.

Ford, like other global automakers, is scrambling to perfect the formula for profitable electric vehicles. The company’s Model e unit, which oversees EVs and software products, reported a loss of $1.6 billion in the last quarter of 2023. Ford said it would slow the pace of money it was spending on EVs in order to better match customer demand.

But the revelation of a skunkworks lab working on low-cost EVs proves that Ford is still determined to compete with Tesla and other automakers in the category.

“We made a bet in silence two years ago,” Ford CEO Jim Farley said in an earnings call with investors. “We developed a super-talented skunkworks team to create a low-cost EV platform. It was a small group, small team, some of the best EV engineers in the world, and it was separate from the Ford mothership. It was a start-up.”

According to TechCrunch, the team is based in Irvine, California, and is comprised of engineers from Auto Motive Power, or AMP, an energy management startup acquired by Ford last year. AMP founder Anil Paryani now holds the title of executive director of engineering at Ford and overlapped with Clarke at Tesla for several years, the outlet reports.

Clarke and his team have developed a “flexible platform that will not only deploy to several types of vehicles but will be a large installed base for software and services that we’re now seeing at [Ford] Pro,” the company’s commercial services unit, Farley said.

Ford aims to compete with Tesla, which is currently working on its own low-cost EV, as well as Chinese automakers like BYD, which have proven successful at selling millions of affordable plug-in vehicles around the world, he added.

But these vehicles aren’t coming out anytime soon. The skunkworks team is likely working on what will be Ford’s third-generation vehicles. Those will come after the company’s second-generation EVs, an electric truck and a three-row SUV, which are expected to go into production at the company’s Blue Oval campus in Tennessee starting in 2025. Those vehicles will be profitable “in the first 12 months of their launch,” Farley said.

Hybrids will also play an “increasingly important role” in Ford’s future, he said. The company’s hybrid sales were up 20 percent in 2023, and Farley said he expects them to be up by 40 percent in 2024.

Ford has scaled back some of its EV plans as demand for the company’s plug-in vehicles has slowed and some dealers have balked at the costly infrastructure improvements necessary to sell them. The company said it would delay $12 billion in investments, including a planned battery factory in Kentucky.