Ford CEO says Chinese electric car company is grossly undervalued

Lead: Ford Motor CEO Jim Farley said on Wednesday that Chinese electric car companies are “significantly undervalued” and he expects them to become more important in the future.

  Farley, who is leading Ford’s transition to electric vehicles, said he expects “significant changes” in the competitive space.

  ”I would say that new electric vehicle companies may be simpler. China (company) is going to become more important,” Farley told the Bernstein Alliance’s 38th annual strategic decision-making meeting.

  Farley believes that the market size that many EV companies are chasing is not large enough to justify the capital or valuation they are investing in. But he sees Chinese companies differently.

  ”Chinese EV makers … if you look at the $25,000 material for an EV in China, it’s probably the best in the world,” he said. “I think they’re seriously undervalued.”

  ”They haven’t, or haven’t shown any interest in exporting, except for Norway… A reshuffle is coming. I think it’s going to benefit a lot of new Chinese companies,” he said.

  Farley said he expects integration among established automakers to struggle, while many smaller players will struggle.

  U.S.-listed Chinese electric car makers such as NIO are rolling out products faster than traditional rivals. Warren Buffett-backed BYD electric cars also sell for under $25,000.

  Farley said some new players will face capital constraints that will make them better. “Electric vehicle startups will be forced to solve top-tier problems like Tesla did,” he said.

Post time: Jun-06-2022