‘Expensive’ Australian engineering jobs at risk: Ford CEO threatens to axe local Ford Ranger and Everest programs if the Australian Government can’t come to the table

Ford CEO Jim Farley has warned the legacy carmaker may axe its Australian engineering arm if the local government doesn’t come to the table and help equalise costs.

While the Blue Oval hasn’t produced any cars in Australia since 2016, it has since still led the engineering development of vehicles like the Ranger ute and related Everest SUV.

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“Australia has become ground zero for the global industry because your government dropped all the tariffs,” said Farley to Australian media, including CarsGuide.

“It’s a completely open market and also [the Australian government is] pushing CO2 [emission reductions], arguably way beyond the customer requirements.

“So it’s this cauldron of innovation and brutal competition, and to have engineers here – we’re the only ones left.

“It's amazing to me that no one notices that Toyota has like 10 engineers in the country, and Ford has got thousands.

“Do we get credit at the brand level? Probably not, but thank god they’re here because we wouldn’t have a [Ranger] Super Duty without them, and the global Ranger wouldn’t be number two to HiLux globally.

“[The Australian federal government] needs to decide if they want to help us equalise the cost differential … because this is among the most expensive places to have engineers on the planet.”

Another element is the Australian government’s New Vehicle Efficiency Standard (NVES) could further strangle the future of Ford’s local engineering efforts.

“What we’ve seen around the world with this kind of pressure on pure EVs is that ultimately all OEMs develop compliance vehicles," Farley said.

“They’re not designed for customers. They’re designed for the OEM to be compliant and they’re subsidised by the OEMs and the customers have great choice.

“That’s not a natural market and over time that winds up not being sustainable.

“Something your government, or any government, has to be very sensitive to [is] around the CO2 glide path. We want to reduce our CO2 footprint, but there’s a level that the customer can’t afford, and not all duty cycles can be electrified.”

Farley noted one particular use case that electrified vehicles currently aren’t suited for is for heavy towing and that this happens frequently in Australia.

“From my standpoint, those are the two policy issues that this country has to face. You want to prioritise mining and extraction of raw materials? Fine, but then you’re going to have to make some tough choices," Farley said.

“Is the CO2 road map sustainable for customers? I think Australia may be on the wrong side of that now.

“As well, you have to decide as a country, do you want to have a traditional engineering capability in your country?”

“I think the [Australian] government has to decide on that and it can’t sit on the sidelines and pretend that’s not a choice.

“It’s a choice because that engineering can be done in a lot of other places … cheaper and faster.

“The good thing is Ford is committed, but we’re not going to make bad choices.”

As it currently stands, Ford does have a wealth of credits as reflected in the 2025 performance period for NVES.

To be exact, it has 451,899 credits which it can either trade with other carmakers for profit or hoard to offset the results in coming years as the targets get stricter.

A major reason for why Ford currently has NVES credits is because it, among a wealth of other brands, advocated for the implementation of two different target types – Type 1 and Type 2.

Type 1 vehicles are regular passenger cars like sedans, hatchbacks and SUVs, whereas Type 2 vehicles include utes, vans, as well as body-on-frame four-wheel drive SUVs with a towing capacity of more than 3000kg.

The latter has CO2 targets that aren’t as low but they still scale down as the years progress.

Many of Ford’s best-selling vehicles, including the Ranger, Everest and Transit all fall into the Type 2 category.

For context, in 2025 the CO2 emissions target for Type 1 vehicles was 141g/km and for Type 2 vehicles was 210g/km.

It has since been reduced to 117g/km for Type 1 vehicles and 180g/km for Type 2 vehicles in 2026.

It takes until 2028 for the CO2 emissions target for Type 2 vehicles to undercut the original 2025 CO2 emissions target for Type 1 vehicles.

It's understood Ford is already making efforts to reduced its fleet CO2 footprint in Australia.

The company has discontinued the 2.0-litre four-cylinder bi-turbo engine in the Ranger and Everest, instead relying more heavily on the single-turbo version in addition to the wealth of other powertrains offered, including V6s and a plug-in hybrid.

The Blue Oval has also introduced more electrified Transit Custom offerings in Australia.

Beyond the E-Transit Custom and E-Transit commercial vans though, the only other pure electric vehicle (EV) Ford Australia currently offers is the Mustang Mach-E mid-size SUV.