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- Japanese automakers used to trounce their American counterparts during their heyday in the 1980s.Ford CEO Jim Farley said China's auto industry poses a similar threat, but on a more intense scale."Oh, I think it's exactly the same thing, but it's on steroids," Farley said.
Ford CEO Jim Farley says the competition posed by China to the US auto industry now is a lot like Japan's in the 1980s, but at a far more intense level.
"Oh, I think it's exactly the same thing, but it's on steroids," Farley told ''CBS Sunday Morning" in an interview that aired on October 26.
"They have enough capacity in China with existing factories to serve the entire North American market, put us all out of business. Japan never had that," Farley added. "So, this is a completely different level of risk for our industry."
Representatives for Farley at Ford did not respond to a request for comment from Business Insider.
Japan was the world's largest producer of automobiles in 1980. The country's automakers produced over 11 million vehicles that year, with companies such as Toyota, Nissan, and Honda trouncing major American car manufacturers such as Ford and General Motors.
This led to a trade war between the US and Japan, with the Reagan administration introducing voluntary export restraints on imported vehicles from Japan in 1981. Japanese vehicle exports to the US fell to 1.68 million in 1981 from 1.82 million in 1980, per data from the Japan Automobile Manufacturers Association.
Farley has long recognized China's position as a market leader in EVs.
In June, Farley said at the Aspen Ideas Festival that China's EV progress is the "most humbling thing" he has ever seen.
"They have far superior in-vehicle technology. Huawei and Xiaomi are in every car. You get in, you don't have to pair your phone. Automatically, your whole digital life is mirrored in the car," he said.
"We are in a global competition with China, and it's not just EVs," he added. "If we lose this, we do not have a future Ford."
More recently, Farley said in a September episode of The Verge's "Decoder" podcast that there's "no real competition from Tesla, GM, or Ford with what we've seen from China."
"The competitive reality is that the Chinese are the 700-pound gorilla in the EV industry," Farley said.
"It is completely dominating the EV landscape globally and more and more outside of China," he added.
Demand for EVs in the US is expected to slow in the near term after the Trump administration rolled back federal EV incentives last month. On September 30, Farley said at a conference in Detroit that he expects US EV sales to halve because of the pullback.
"In the near term, I believe EV adoption will now only be about 5% of the US market, but this is going to grow, especially for affordable EV vehicles," Farley told investors in an earnings call on October 23.
Last year, Farley said in an October episode of "The Fully Charged Podcast" that he was driving a Xiaomi Speed Ultra 7 that he flew in from Shanghai to Chicago. The SU7 is Chinese tech giant Xiaomi's maiden electric vehicle.
Farley said in his interview with "CBS Sunday Morning" that American consumers would want to buy Chinese EVs like the SU7 because it offers "high quality" and a "great digital experience." He added that he was personally driving a Chinese EV "because of the competition."
"To beat them, you have to know them," Farley said.
