To compete with Chinese EV maker BYD, CEO Jim Farley concluded his existing team and processes were inadequate. He formed an independent group with new talent, separate IT systems, and a different philosophy to radically simplify vehicle design and manufacturing.

Counterintuitively, U.S. and global auto firms need to collaborate with Chinese suppliers to reduce strategic dependency. The model involves onshoring Chinese hardware and manufacturing expertise while maintaining national control over sensitive AI software and networks, creating a strategic "co-opetition."

While the loss of the tax credit will hurt sales short-term, it also removes the "government mandate" attack line used by politicians. This forces EVs to be judged as just another car, allowing them to compete on their own merits like lower operating costs and better performance.

Tesla's price cuts are not just a reaction to competition. They reflect the 'scaled economies shared' model, where cost savings from increased scale and vertical integration are passed to customers. This drives more volume, which in turn enhances the scale advantage in a virtuous, recursive cycle.

While China bans many US tech giants, it welcomed Tesla. A compelling theory suggests this was a strategic move to observe and learn Tesla's methods for mass-producing EVs at scale, thereby accelerating the development of domestic champions like BYD, mirroring its past strategy with Apple's iPhone.

Ford CEO Jim Farley relies on "Gemba," a Japanese principle of "go and see with your own eyes." For a major EV strategy shift, he personally inspected a torn-down competitor's car, counting fasteners and examining the wiring loom to understand the manufacturing gap firsthand before making a decision.

Ford's CEO states the company's EV investment strategy is designed to be sustainable without consumer tax credits. The new universal platform's primary goal is to make an affordable EV that is profitable for Ford on its own merits, a crucial step for long-term market viability.

The belief that consumers needed electric versions of familiar gas-guzzling trucks and SUVs led to EVs that were too big, heavy, and expensive. The market is now forcing a pullback from this strategy towards smaller, more efficient, and profitable designs.

Unlike competitors creating isolated 'skunkworks' teams for EV development, GM pursues a steady, integrated approach. The company believes this avoids the 'ingestion risk' of bringing a radical project back into the main organization, allowing innovations in battery tech and architecture to scale more quickly and efficiently across its massive global portfolio.