According to CEO Jim Farley, Ford Motor plans to launch a successful all-electric car for $30,000 in around 2.5 years, which he said on Friday at the Aspen Ideas Festival.

Farley noted that the vehicle’s primary competitors are projected to be Chinese manufacturers like BYD and an upcoming entry-level car from U.S. EV leader Tesla. The vehicle is being created by a Ford “skunkworks” team. Farley did not disclose many further specifics about the vehicle.

According to Farley, Ford is prioritising smaller EVs above bigger all-electric trucks and SUVs, which have historically been the company’s main sources of profit due to their “never going to make money” nature.

“You have to make a radical change as an [automaker] to get to a profitable EV. The first thing we have to do is really put all of our capital toward smaller, more affordable EVs,” Farley said during an interview with CNBC. “That’s the duty cycle that we’ve now found that really matches. These big, huge, enormous EVs, they’re never going to make money. The battery is $50,000. … The batteries will never be affordable.”

Later, a Ford representative explained that Farley was talking to big cars like the Super Duty models or cars that need huge battery packs in order to reach notable electric vehicle ranges of 500 miles. He wasn’t talking about next-generation EVs or the all-electric Ford F-150 Lightning truck that is now on the road.

Earlier this year, Ford said that it was delaying the manufacturing of a huge three-row SUV from its original 2025 schedule to 2027 at a factory in Canada. The next-generation truck, known as the “T3,” was also pushed back from late 2025 to early 2026.

Farley reaffirmed on Friday that Ford’s next models will turn a profit.

In addition, he stated that Americans should “fall back in love” with compact vehicles rather than bigger ones. This is a startling claim considering that trucks account for the majority of Ford’s earnings and that American automakers have traditionally struggled to turn a profit on compact models.

“We have to start to get back in love with smaller vehicles. It’s super important for our society and for EV adoption,” Farley said Friday. “We are just in love with these monster vehicles, and I love them too, but it’s a major issue with weight.”

With 10,000 vehicles sold in the first quarter of this year, Ford’s EV division lost $1.32 billion. Even if the unit also sells software and other EV-related products, the losses come to a loss of $132,000 for each vehicle the unit sells.

According to Farley, Ford must produce viable electric vehicles (EVs) over the next five years given the worldwide expansion of Chinese manufacturers.

“If we cannot make money on EVs, we have competitors who have the largest market in the world, who already dominate globally, already setting up their supply chain around the world,” he said. “And if we don’t make profitable EVs in the next five years, what is the future? We will just shrink into North America.”

(Adapted from CNBC.com)