This is a company that helps car dealerships sell extra “protection” add-ons. The idea is that dealers can earn more money by offering these products to customers.
An EV platform is the main “building plan” for electric cars. If it’s “universal,” it means Ford wants to use the same core design for more than one EV to make them cheaper and easier to build.
A “step change” means a big improvement, not a small tweak. In this context, Ford is saying it wants a major jump in how cheaply and efficiently it can build EVs.
A “skunkworks” is a special team inside a company that’s built to move quickly and try bold new ideas. The goal is to test innovations without the usual slow, big-company process.
A “moonshot” is a very big, high-risk goal—like trying to achieve something that’s way harder than normal upgrades. Companies use the term for projects that could change the industry if they work.
The Ford F-150 is Ford’s best-known truck and one of its biggest sellers. The hosts are saying Ford could use lessons from its experimental team to improve how it builds trucks like this.
The Ford Bronco is Ford’s modern off-road SUV line, built to compete in the rugged, enthusiast-focused segment. In this discussion, it’s mentioned alongside the F-150 and Mustang as another “core product” that could benefit from experimental platform or manufacturing concepts.
The Ford Mustang is Ford’s famous performance car. The hosts are using it as an example of a major model line that could benefit from new ideas Ford is testing.
“UEV platform” sounds like a new car design foundation Ford is working on. The hosts are basically saying: even if the idea is good, it only works if Ford rolls it out across the whole company, not just a few experimental vehicles.
Car
Ford Lightning
The Ford Lightning is the electric F-150. The point here is that when it launched, supply problems and unusual timing made waiting lists look bigger than normal demand.
Car
Ford Mach-E
The Ford Mach-E is Ford’s electric crossover. The hosts are saying its launch period was affected by shortages, so the waiting lists didn’t necessarily mean the market would stay that hot.
A chip shortage means there weren’t enough computer chips available for cars. If cars can’t be built because parts are missing, buyers end up waiting longer than they would in normal times.
The Ford Maverick is a smaller pickup truck that’s meant to cost less than bigger trucks. The podcast is talking about the idea of making a new version that could be even more affordable, and possibly an electric version. That would still be a pickup, just with different power.
A tariff is a tax on imported products. “Tariff hit” means the extra money companies have to pay because they’re importing vehicles or parts.
Term
market strategy
Here, “market strategy” means deciding where to make cars and where to sell them. If taxes on imports change, companies may need to adjust those choices.
An aluminum supplier provides the aluminum parts used to build vehicles. If that supply gets interrupted, the automaker may not be able to build as many trucks.
Pickup buyers often stay loyal to the same truck brand. The hosts are saying that’s why it’s usually hard for competitors to steal customers—unless the preferred brand can’t deliver.
A “conquest opportunity” is when one brand can steal sales from another brand. Here, it’s because Ford may not have enough trucks available, so shoppers look elsewhere.
“Days supply” is a way to measure how many days of cars are sitting on lots. If it’s low, dealers don’t have many cars left; if it’s high, there are more cars than buyers are taking.
“Inventory levels” just means how many cars are available for sale. When there are fewer cars than people want, it can affect pricing and how hard it is to find the exact configuration you want.
“Commercial side” means trucks bought for work by businesses, not just personal use. Those buyers care a lot about whether the truck can be set up for the job.
Upfitters are companies that customize a truck for a specific job. Since the equipment is built to fit a particular truck setup, switching trucks isn’t quick or simple.
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Welcome to this weekend drive edition of Daily Drive for the second week in May,
2026. I'm Kellen Walker in Las Vegas. We're breaking down some of the biggest stories from
the past week and looking forward to what's in store in the days ahead.
Today, we'll talk about Ford's Secretive Skunkworks project in California to develop
a next-gen EV, the state of the pickup market as Chevy looks to capitalize on F-150 supply issues
and more. Joining me today, as always, Michael Martinez, who covers Ford and the UAW for us
at Automotive News. Mike, welcome back. Thanks, Cole.
And Larry Velikwet, who covers Toyota and Subaru and Mazda for us, Larry Legend. How have you been,
sir? I've been fine. Feeling spicy today. Me too, which makes for a good episode.
Mike, I am so sorry. You're going to have to be the adult today.
It wouldn't be the first time. Per usual, right? All right, guys, let's get started.
So, Mike, you got a rare look inside Ford's California Skunkworks where they're building
what Jim Frawley calls Ford's Answer to the Chinese. You talked about this on Tuesday's show.
Remind us what you saw out in Long Beach and how important is this project for Ford's future?
Yes, Ford has a new electric vehicle development center in Long Beach. It's 300,000 square feet
through two main buildings. They outgrew some smaller digs in nearby Irvine. This one's right
next to the Long Beach airport. And this is the home of the Skunkworks team, the team that is
building the universal EV platform. And we're going to see the first product on that platform.
It's that $30,000 midsize EV pickup. And in terms of importance, this is critical to the company's
future. Jim Frawley's called it their moonshot. He said it represents a step change in terms of
costs and efficiency. And this is a company that they are letting operate like its own startup
within Ford, a company within a company, so to speak. You have complete separation,
both literally it's pretty far from Dearborn and figuratively in terms of who can work on that
program. One of my most fascinating details I learned in reporting that story was that if any
Ford veteran wanted to join the team, they had to be vetted. They had to go through an interview
process. And a not insignificant amount of them didn't make the cut if they didn't fit the culture
and if they didn't fit in terms of their smarts or their capability to deliver this new platform.
And it's really fascinating, Kel, because if you think about it, whether or not they're successful
here, it gets to that bigger picture of can a legacy automaker, can a company with century plus
of experience change on the fly and adapt to what some of these startups and what the Chinese
are doing in terms of speeding development, really drastically reducing costs. And we'll
find out next year whether they succeed or not. Now, Mike, is this like Ford's like black budget
project? Because the use of the term skunkworks, are we overusing that? Because I immediately think
Lockheed Martin and SR 71 Blackbirds. Yeah, that's exactly right. I don't know that we're
overusing it because that's what they've modeled it on. Kelly Johnson, who founded the skunkworks
team for Lockheed Martin is apparently one of Doug Field's heroes, manufacturing engineering heroes.
So they called it the skunkworks team. If you know the history back in the late 30s, early 40s,
what was it? Lockheed had this team that operated basically on its own. It was before Skunkworks,
it was called its advanced development projects team. And fast forward to today, what's Alan
Clark's title for Ford, Vice President of Advanced Development Projects. So you mentioned the
Blackbird, the SR 71, they developed this spy plane, and a number of other fighter jets and vehicles
on sort of a tighter budget smaller team. And there's a number of parallels to what Ford wants
to do. Now, this isn't the same level of stakes, we're talking about an affordable EV truck,
not national security, no national security implications here. But one thing Alan Clark
told us was they really valued the way the Lockheed skunkworks team were able to not only change
processes in terms of manufacturing, but processes in terms of sourcing. He referenced the Blackbird,
he said, you know, that plane was mostly built out of titanium. Where did most of the titanium come
from? I think it was the 60s-ish when it was built, came from the Soviet Union, came from Russia,
the country we were trying to build it to spy on, in the heart of the Cold War. So what did the team
do in partnership with the CIA and the government? They set up these shell companies, basically,
consumer facing shell companies to source titanium from the Soviet Union. And they were able to put
it all together into the Blackbird. So again, the stakes aren't quite as high or as serious,
but they're really trying to mimic the lengths and the different ways the Lockheed skunkworks
went about building their products. And one last thing I would say, what struck me when I walked
into the lobby of this building, there's this list of 12 cultural commandments. I mentioned
this on Tuesday's show, but it's very start-up-y. There are phrases like fight silos, step on toes,
simplify down to the atom. Sir Isaac Newton decides that was a fun one. It's meant to remind people
that physics is really their only real limit. But again, that mimics Lockheed skunkworks team.
They had 14 principles they were working on. They were a lot less pithy. I think one of them was,
you must conduct a monthly finance review. Ford does that. Another one was the contractor must be
able to test their pieces to final completion. And that's what Ford's trying to do here. They
want to strip the bureaucracy and say, hey, we have an idea. We need to shrink this part 10%.
Let's see how it fits and run all the models, not get signed off from Dearborn first, not go back
to the supplier and wait a month for a new part. Let's 3D print it. Let's do it all here and speed
up what might take months into a few days. So it may end up being cliche using the skunkworks term,
but they're really, really trying to mimic how Lockheed did things.
If you haven't had a chance to read Mike's story, make sure you go grab it and go through it
on our website. What's really interesting to me is the rationale behind this, right? That
was impressed by what they were doing, but if anything, it's not big enough.
What they're talking about is an affordable pickup truck and maybe an EV platform. But
if that's their China answer, that's not an adequate answer. I just want to put it in
perspective. We're using phrases like skunkworks and the moonshot and on an individual company
basis, maybe. It's certainly a cultural difference, but this is not the China answer. This is an
aperitif of the meal that everybody is going to have to eat in order to fight China.
And that's a great point, right? It's one product. It's going to be expanded. It is a platform.
I think we've reported there's going to be about a half a dozen vehicles on this platform, but the
real test, and Jim Farley said this on the earnings call the other week, he said the real gift of
skunkworks will be what it does for the rest of the company. So I asked Alan Clark when I was in
California, can you do what you're doing here on F-150 on Bronco, on Mustang, on the existing
core products for Ford? And part of the answer is yes, in terms of concepts, how
they're changing the work. Now, obviously, it's not an EV platform. There's some things that won't
translate. But yes, you can be more efficient in how you manufacture and build the products you've
been building for 100 years. So once whether or not they get this UEV platform, right, it could
still fail miserably. Who knows? But if they get it right, the real answer, the real trick for
Ford will be incorporating it into the rest of the company and not just being a one off side
project for a few vehicles. Here's the million dollar question for me. When this comes out,
will people line up to buy it because of its price or because of its innovation, whatever,
or will they go, oh, that's pretty innovative. I'm going to wait a year. That one, let's make sure
the wheels are going to stay on. That's going to be fun to watch. Well, that's an interesting
point, Larry, because if you remember, something that you could argue almost doomed their first wave
of these new EVs, the Lightning and the Mach-E, is that it was just coming out of COVID, just coming
out of the chip shortage. And there was way higher demand than what was really realistic and indicative
of the market at large. So there were years, months long waiting lists for the Lightning,
for the Mach-E, for anything anybody was coming out with at that time. So I'm not sure Ford is
really banking on years long wait lists this time. They want a more realistic picture of what
the market's going to be versus that inflated sense of demand that ultimately doomed those projects
because they geared up to build way more of them and turns out they didn't need to.
Larry, now we've seen other automakers try to set up these separate operations, Tesla poaching,
Silicon Valley culture clashing with Detroit. What makes you think this one might work or
might not? I honestly can't tell you whether it's going to work or not. Nobody knows when we do these
secretive projects that go against the culture of an automaker. And they do it purposely, right?
Because people get trapped in that culture and they go by because they have careers at that
company. They go by the book that they have built at that company and this is how we develop
products and this is what it has to have and et cetera, et cetera. So there's some benefit to
doing these one-offs because you can break that habit. The fact that we're keeping it tight and
focusing on one volume product, presumably a better cheaper Maverick, an EV Maverick,
it's an interesting thought because, man, if there's a challenge right now anywhere in this
industry, it's doing things cheap. Now, Mike, what's the timeline here? When should we see some
actual work being done in California? Well, I got to see some of the work being done in California.
I don't know when you guys will. Part of the tour was there was a very scripted moment. I
mentioned this to Jake on Tuesday where they showed us a quick glimpse of a heavily camoed
version of the truck and it looks pretty Maverick size. I saw it from 50, 100 yards away, whatever
it was, so couldn't give you a great detail on it. But I think Ford is supposed to be taking
the wraps off this thing near the end of this year and then it's supposed to launch in 2027.
So within the next year, again, we'll find out whether this was a success or a failure.
I love how this is such a big secret. That's like an open secret. So it's not really a secret,
but it is a secret. That's good stuff. That's funny. Coming up, we'll talk about Toyota's
big loss to spy record sales and the changing state of the pickup market. That's next on Weekend Drive.
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Welcome back to Weekend Drive. I'm Kellan Walker, joined by Michael Martinez and Larry Belliquette.
So Larry, last week on Weekend Drive, you predicted Toyota would post a loss despite
record U.S. sales. And that's exactly what happened. Walk us through what you saw coming.
So, Kell, indeed, Toyota Motor North America, which operates Toyota's production and sales
operations here, posted an operating loss of $1.21 billion for the fiscal year that ended
March 31st, the Japanese fiscal year that ended March 31st. That's compared to a $681 million
gained the year before, a $1.9 billion swing. Now, they had their fourth best year
as an automaker ever in North America, and they still lost, they still swung to the bad $1.9
billion. Why? Tariffs, pure and simple. Tariffs put an $8.64 billion hit in Toyota Motor Corp's
earnings, so much so that they forecast an operating profit for the coming year,
the one that we are now in, to tumble 20% across globally, where they will only make
$18.79 billion. Only. Instead of the $23.61 billion that they fell to this year. Yeah,
always are. But interestingly, we saw that, you know, we have known this for a while, that
they were struggling, they've said they were struggling, they talked about it at the turn
of the calendar year, how they were going to have to increase pricing probably three times this year,
over the course of the year, just to try and mitigate some of these. And one thing that the
new CEO talked about was they're going to look to their suppliers to help. That's a new look for
Toyota, right? They have the best supplier relations in the industry and have for a very long time,
because they work really closely with their supplier partners. It will be very interesting
to see how this plays out, because if they go into the, I don't think that they'll go in heavy-handed,
but they are looking to their suppliers for help with their, you know, with their losses. And the
suppliers are not exactly rolling in money right now either, because of Terrace. This is going to
be really interesting. I will say one other thing. They forecast a $4.2 billion impact
a US Iran war going forward. Now, that's interesting in that they think that they're going to lose
500,000 to 600,000, some of the 500,000 to 600,000 vehicles that are sold in the Middle East each
year, which is about a quarter of what Toyota sells in the US every year. What can happen, though,
is because this could actually play out well for Toyota dealers, because Toyota's global production
is pretty much maxed out. We could see some of those vehicles get moved here. And Toyota's got
the tightest inventory in the industry. They'll take them. Mike, what's your take on the Toyota
situation and what it might signal for other automakers? Yeah, my take is that maybe Akiyo
Toyota might want to put that Trump Vance t-shirt he was wearing in the back of his closet for a
while. I don't think this one's that complicated, right? The lesson for, if you're an import automaker
is you're going to need to onshore more because you look $8 billion ish in tariffs. That's a lot
of money. That's the reason they swung to a loss, plain and simple. Plus you have the Iran war now
that's threatened them even further. So the lessons are billed as much as you can in the states.
You need to continue to offer diversified powertrains, which Toyota has done to their credit.
They have a lot of investments and EVs in the works now, either unfortunately or fortunately for
them. But you sort of have to stick to your guns at this point. Larry will probably have
the numbers off the top of his head in terms of investments they've made in the United States in
the past year. Those will bear fruit. But just in the near term, if you're a domestic automaker,
like a Ford or a GM, you're only talking $2 or $3 billion worth of tariff hit. So
the impact's a little bit lower. But if you're one of the import brands, you really need to think
about changing your market strategy in terms of where you build and where you sell. So
it doesn't seem to me like this was really any of Toyota's faults. I enlarge that this is just a
consequence of the geopolitical actions that are happening around them and the changes to policy
that they can't really affect. So again, in terms of lessons, I don't know that there is one besides
at this point, you have to hope to build as much as you can here. Yeah. And it's worth noting,
Mike brings up a valid point. More than 50% of the roughly 2.2 million vehicles that Toyota sells
in the US every year are built in the US. So a little over half. And 20% come from Japan.
Right. So now we're at 70. And the rest come from two places, Canada and Mexico.
Two of their biggest volume vehicles, RAV4 and the Tacoma come from Canada and largely come from
Canada and Mexico exclusively. So we're talking about large volume vehicles. And the stuff that
comes from Japan, that's only got a 15% tariff. What's killing them is the tariffs that they're
paying from the stuff like the domestic automakers, the tariffs that they're paying on stuff from
Canada and Mexico. That's just, it's wreaking havoc on their bottom line.
Like every automaker that has lived under the North American free trade agreement or US MCA,
whatever you want to call it. Everybody's going through this because of the severity and how
quickly they were being asked to move stuff to the US proper and getting whacked and stuff that
had been in Canada and Mexico. All right, guys. Well, before we wrap up, let's talk pickups.
GM is pushing dealers to boost inventory on their lots, trying to capitalize on Ford's
F-150 supply problems. Mike, remind us why Ford's in this situation in the first place.
Thanks to that September fire at Novellis's aluminum plant in New York, right? Novellis's
Ford's main aluminum supplier for its trucks, for its big SUVs. And there was a pretty devastating
fire. And then another follow up fire a few months after that, when they were trying to
get the plant back open and Ford's inventory has suffered. Remember before they decided to kill
the lightning, they stopped the lightning lines to focus on F-150 to prioritize their remaining
supply onto the gas and hybrid models. And now Ford's trying to scramble to boost production by
50,000 units this year to offset what it's lost. And inventories are dwindling for dealers. I talked
one the other month we reported on it said typically for truck month he has 70, he was down to nine.
So the the upshot is Ford's expecting the Novellis plant to be back online by the end of this month.
So they're hoping this is sort of the bottom of their inventory situation. And it's only going
to go up from here. But you have the sharks circling in the water and Chevy's ready to pounce.
Now, Larry, what kind of opportunity do you think this presents GM and other automakers?
And will it last long enough to actually hurt Ford's market share in the segment?
There are a couple of things going on here. Number one unit, I know we talked about this
earlier, the Calvin test, right? Yes. Pick up pickup truck loyalty is the strongest of any segment
when generally when somebody chooses what brand to pick up they are going to drive,
it's very difficult to get them to change. Automakers know that. So these conquest opportunities,
they don't come up very often because people are so locked in and they just you know, they're on a
schedule, etc. There's a couple of things, though, that are that are special about pickups, not
not least of which is a huge segment in the US, right? But we tend to think I think most people
tend to think of these as you got you got the lifestyle trucks, people that drive them that
don't need them. And you got work trucks. There's a huge percentage of vehicles that are pickups
that are leased by companies. And they're you know, they're put on lease schedules. And so if
you don't have availability, when your lease schedule is up, you're you may end up getting another,
you know, another brand pickup. So there's an opportunity there for the cross brands for Ram
and for Chevy and GMC to pick up some and even Toyota, although it's a you know, Toyota's a
and also ran in this segment. I do want to point out though, I've been doing the inventory story
at Autobot News now for better going on going on 12 years, I think, the monthly inventory story.
Right now, Ford has the largest active inventory of any automaker, right, is more vehicles. Now
that that's across that's not just pickups, that's everything, right, is over 406,000 vehicles that
Ford dealers have on their lots, that they're advertising for sale. But if you look at the
at the segments, right, where where segments are full size trucks, which are not which normally have
automakers want about 100 days supply to a full size trucks, they've all these different configurations,
you know, based on bed size and and how the seats are configured and whether you get one,
one row of seating or two and how the doors are configured. So dealers have to stock a lot of them.
They want a healthy inventory, but full size pickups, not the heavy duties, just full size
pickup, the day supply right now, 63 days. That's under what midsize SUVs, full size SUVs.
That's one of the tightest inventories, inventory levels that I have seen in the last decade
for full size trucks because of this novellas fire. So yeah, there's opportunities for other
for other automakers, you know, but they got a long a long way to get to make that
goal. And their best bet is on the commercial side. Well, speaking of the commercial side,
we saw Ram this week talking about going after more small business buyers.
What's your guys's take on that competitive landscape? Anyone can jump in. Go crazy.
You know what, I'm going to jump in here. I see Mike, Mike raises his hand,
but I'm going to jump in here on the commercial side. We're going to continue this conversation
a little bit on the commercial side. What's really important for pickup trucks is are the
outfitters, right? Every commercial company has an outfitter because they configure their truck,
the way that they're, you know, that they want. So they have all these
truck specific beds that they put on and the etc, etc. So it's not easy for them to change.
It takes a lot to get a company to switch. They have to have the upfitters,
the upfitters have to have their configuration available. So it takes a long time.
It's an opportunity, yes, but it's not an easy opportunity.
But with that being said, on the commercial side, you do tend to strip out a lot of the emotion
of the loyalty on the retail side. My daddy drove a Ford and his daddy before him drove
a Ford and I'm going to drive a Ford until I die, right? There's none of that. It's about the
dollars and cents. Does it pencil out? And if you can offer a compelling case, and if you can,
you know, we see all the automakers talk about bringing more of the upfitting work in-house
or offering more out of the factory where you don't have to go to the third parties.
So if there's an opportunity and you can put a lot of discounts on and you can give a business
exactly what it wants for cheaper, they're probably more willing to make that move than
a retail customer might. Good point. He's right. He's right. Good stuff. Mike, Larry, as always.
Thank you so much for joining me. Thank you, Cal. That's all for this weekend drive edition of
Daily Drive. I'm Kellan Walker. Thanks to Automotive News executive producer Jake Neer for his help on
today's podcast. You can get the latest news on the pickup market, Ford Skunkworks project and
everything happening in the auto industry at AutoNews.com. Come back on Monday for a conversation
with Anders Bell, Chief Engineering and Technology Officer at Volvo Cars. So from this perspective,
the software defined vehicle is like a massive reset. Like it changes completely how you approach
the product from a product development organization. We'd love to hear from you.
Let us know what you think of the show and the topics we cover today. Send us an email
at dailydrive at autonews.com or leave us a voicemail at 313-444-2774. And if you enjoy
the podcast, remember to like, leave a review and subscribe so you never miss an episode.
About this episode
Ford’s “Skunk Works” is taking shape in Long Beach as a tightly focused effort to build a universal EV platform—starting with “a $30,000 midsize EV pickup.” The hosts compare it to Lockheed Martin’s model, including rapid development tactics like 3D printing to cut timelines. They also connect Ford’s EV struggles to COVID-era chip shortages and current inventory dynamics. Toyota, meanwhile, reports a $1.21 billion operating loss, blaming tariffs and forecasting weaker global profits amid tight U.S. inventory.
