Farley’s Model T Moment: Bold EV Strategy In A Risky Policy Era
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Last Updated on: 15th August 2025, 02:02 pm
When Ford unveiled its Universal EV Platform in August 2025, the presentation was equal parts engineering showcase and strategic declaration. Jim Farley framed the new architecture as the company’s “Model T moment,” built to deliver affordable electric vehicles at scale with radically simplified manufacturing and domestically produced LFP batteries.
He was clear that the bet was enormous, with $5 billion already committed, and equally clear-eyed about the uncertainty. Farley told investors and the public that he could not guarantee the plan would all go right, calling it a risk the company had to take to remain competitive. In that admission was an acknowledgment that Ford was pressing ahead in a hostile policy climate, banking on both its cost-cutting innovations and a future turn in U.S. politics that would once again favor electrification.
Richard Rumelt’s kernel of good strategy is a simple but powerful way to think about whether an organization’s strategy actually connects diagnosis, guiding policy, and coherent actions. The diagnosis is the clear-eyed understanding of the situation and the forces that matter most. The guiding policy is the high-level approach chosen to address that situation. The coherent actions are the specific steps and investments that follow logically from the policy and actually put it into motion. If any of these three is missing or misaligned, the strategy will wobble when reality pushes back.
In the case of Ford’s Universal EV Platform, the diagnosis in 2022 and 2024 looked strong. In 2022, the first serious work began at a skunkworks in California, operating outside of Ford’s normal development culture. In 2024, when Ford committed to the Platform, the Biden administration’s Inflation Reduction Act was in place, delivering $7,500 consumer credits for qualifying EVs, $35 per kWh manufacturing credits for domestically produced batteries, and large funding streams for charging infrastructure. U.S. policy, capital markets, and public opinion were aligned in supporting electrification. In that environment, a $5 billion commitment to a flexible, high-volume, low-cost EV architecture made sense. The product vision was clear: a family of affordable EVs that could be built with fewer parts, faster assembly, and domestically produced batteries. With supportive policy locking in lower consumer prices and lower production costs, the economics could work.
The guiding policy at that time was straightforward. Invest in advanced design and manufacturing to get EV costs down, bring critical supply chain pieces like LFP battery production to U.S. soil, and be ready to deliver mass-market EVs with a total cost of ownership lower than gasoline competitors. Ford’s leadership, including Jim Farley, clearly saw that the biggest barrier to mainstream EV adoption was cost, not engineering feasibility. The Universal EV Platform was the coherent set of actions to follow that policy: 20% fewer parts, 25% fewer fasteners, large one-piece castings to replace dozens of components, a modular “assembly tree” process to cut assembly time by up to 40%, and a new zonal electrical architecture to simplify wiring and electronics.
In August 2025, however, policy has shifted in Washington. The Trump administration has ended the $7,500 consumer EV credit, rolled back charging infrastructure funding, and imposed 50% tariffs on imported steel and aluminum from all countries, including Canada and Mexico. These moves raised the effective consumer price of EVs, slowed expansion of public chargers, and increased the cost of raw materials and cross-border manufacturing. For a platform designed to be affordable at scale, these are all direct headwinds. If these policies persist, the economics that supported the 2022 and 2024 investment decision are undermined. The domestic market could remain price sensitive and wary of short-range EVs without robust charging coverage.
Announcing and pushing ahead with the Universal EV Platform in this context tells us something about Ford’s current guiding diagnosis. Farley and his team appear to be betting that the Trump era will be short lived and that IRA-style incentives, or something similar, will return in time for the first platform products to reach volume. They are choosing to continue spending on tooling, battery plants, and supplier commitments despite the present headwinds. That is a coherent choice if the company’s internal assessment is that U.S. policy will swing back toward supporting EV adoption before these vehicles hit peak production.
The coherent actions are impressive from a product and manufacturing perspective. The Universal EV Platform offers structural LFP battery packs made in Michigan to cut costs and secure supply, a reimagined assembly process that builds front, rear, and center modules in parallel before marrying them, and heavy use of large castings to simplify production. The zonal wiring architecture reduces wiring length and weight, simplifies assembly, and reduces failure points. The engineering team has focused on making these vehicles cheaper to build without feeling stripped down for the buyer.
A problem is that the base pack is roughly 51 kWh, delivering a range that might be fine in Europe or parts of Asia but is short for many American use cases. The United States has long driving distances between cities, uneven charging coverage, and a cultural expectation that a vehicle can handle a long trip without refueling anxiety. Without a dense and reliable charging network, short range will limit market appeal in the very geography the platform is designed for.
Outside the United States, the platform is poorly matched to conditions. These are North American sized vehicles, too wide and long for most European roads and parking. In other markets they would run up against high-quality EVs from companies like BYD that offer more range at lower cost, backed by domestic supply chains. That means the realistic addressable market is mostly the U.S. and perhaps Canada, with limited potential to spread fixed costs over global volumes.
The Universal EV Platform has potential in the commercial vehicle space, where total cost of ownership often drives purchasing decisions more than upfront price alone. Fleet operators for utilities, delivery services, municipalities, and trades would benefit from the platform’s simplified manufacturing, modular assembly, and domestically produced LFP batteries, which together promise lower maintenance needs and predictable energy costs.
The ability to configure the platform into vans, service trucks, and other work-focused body styles will allow Ford to target segments where range requirements are modest and daily charging at depots is practical. In these use cases, the short base range becomes less of a limitation, while the durability, lower operating costs, and eligibility for any commercial EV incentives could make the vehicles an attractive choice for organizations looking to reduce fuel expenses and meet sustainability targets.
In the U.S., the competition will not be idle while Ford ramps this program. Tesla might delivered a stripped down Model Y, although it shelved its cheap “Model 2” program. GM’s Ultium-based Equinox EV is aimed directly at the affordable crossover segment. Toyota is preparing its own EV pickups and SUVs with advanced manufacturing and potentially longer range. Stellantis is bringing STLA-based vehicles to the U.S. in similar price bands. Each of these companies will have their own cost reduction strategies and dealer networks ready to compete for the same buyer.
Ford is making a very large, very specific bet at a high-risk time. If the political environment shifts back toward pro-EV incentives and infrastructure with the next administration, the Universal EV Platform could arrive in a market ready to reward its cost advantages, although the timing is imperfect. If the current headwinds persist, the platform will be stuck selling short-range EVs at prices the mass market resists, in a domestic market where other OEMs are offering longer range for similar money, and with little opportunity to shift volume abroad.
In Rumelt’s terms, the diagnosis, guiding policy, and coherent actions were aligned when the bet was made. The diagnosis has now changed, but Ford’s guiding policy has not. That may be admirable persistence or it may be a setup for a strategy that will not pay off. And, of course, Ford has to execute cleanly and effectively.
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