Ford CEO Loves His Chinese Xiaomi EV – The Critical Need For Partnerships With Companies Like Lenovo

In what sounds like a man-bites-dog story, the Ford CEO has been driving a Xiaomi SU7, which is, admittedly, one of the best EVs you can’t buy in the US, and he doesn’t want to give it up. Currently, Xiaomi sells between 10K and 20K SU7s a month, and these cars have been backordered for around 6 months, showcasing just how popular they are while Ford is struggling. And the Ford CEO isn’t the only one who is very worried.

I’m an ex-competitive analyst, and in my initial training, we used Ford and GM competitive analysis groups as they existed in the mid-60s as examples of how not to do that job. Chinese car makers are fast eclipsing every other car maker on the planet, and everyone from those in Japan to those in the US is concerned that should the Tariffs and Sanctions go away (which they eventually will), the existing large car makers will go under.

This is similar to what happened when the Japanese car makers brought up their quality and geography-focused design groups in the 1970s when they almost took out the US car markers of the time, and this looks far worse than that was.

The Competitive Analysis Problem In the 1970s

The example I was given back in training was of GM and Ford, which both saw the rise of the Japanese car companies as a threat and had some of the most well-funded competitive analysis groups on the planet.

So, they took a 1966-era Japanese car from companies like Toyota and Nissan and tore it apart, analyzing every bolt, every nut, and every single part in those cars. Over five years, they developed a plan to build better cars than Japan. The only problem was Japan didn’t stop moving, and by the time Ford released the Pinto, and GM released the Vega to compete with Japan, Japanese cars had massively improved, and those US cars were not competitive at all.

Compared to cars of the mid-60s, they were a big improvement. It's just that Japan, which had been largely thought of as a country that copied other firms’ work, had moved ahead of the firms they once copied, and the US car makers were found wanting. This problem was massively exacerbated by the huge gas shortages and gas price increases of the 1970s, which almost took GM and Ford out.

The issue was that it took so long to do the incredibly detailed analysis that it added to the typical 3–5-year product cycle time these US firms enjoyed, making the result worse than useless.

The Need For Tech Partnerships To Increase Product Cycle Times 

Chinese car companies are moving even faster than the Japanese ever have, and even Japan is worried they are being left in the dust. This means that to survive, US car companies will need to move away from the 3-5-year product cycles and begin to adopt product cycles much more similar to personal electronics to keep up. Some, like Lotus, are partnering with companies like Lenovo to remain competitive because tech companies are used to these fast cycle times (this was announced at Lenovo Tech World this year).     

EVs, in particular, are basically rolling computers that have become unsustainably complex over time, leading to reliability problems and long lag times between applied advancements. It is critical that these car companies get on the same page as tech companies and increase their speed of innovation; otherwise, the Chinese companies will leave them behind, much like the Japanese companies did decades ago.

Wrapping Up:

Ford and GM aren’t alone in being concerned about how fast the Chinese car companies are moving and how good and well-priced their cars are. These companies need to follow Lotus’ example and partner with tech companies like NVIDIA and Lenovo, who are not only closer to the technology that is advancing Chinese car makers but also the speed at which those advancements occur; otherwise, they will continue to be left in the dust and once the sanctions and tariffs go away, so may their companies because, right now, they aren’t competitive. 

Rob Enderle is a technology analyst at Torque News who covers automotive technology and battery development. You can learn more about Rob on Wikipedia and follow his articles on Forbes, X, and LinkedIn.