During its quarterly earnings call this week, Ford reported significant losses on electric vehicles but still promised lower-priced models.
As reported by CNNFord said its electric vehicle unit lost $1.3 billion in the first quarter, or $132,000 for each of the roughly 10,000 electric vehicles sold by the automaker during that period. Sales were down 20% from a year earlier, but revenue was down 84%, which Ford attributed to an industrywide drop in electric vehicle prices.
Ford Mustang Mach-E 2024
Ford CEO Jim Farley predict the electric car price war in 2022, although it seems the automaker can’t prepare for that just yet. During the earnings call, Ford Chief Financial Officer John Lawler said the automaker has eliminated $5,000 in costs for the Mustang Mach-E crossover, but the sales decline is happening faster than the cut. Cost reductions like this can happen.
Instead of waiting for the traditional mid-cycle refresh, Ford has step by step redesign of the Mach-E to reduce production costs, and it has reduced the price of the Mach-E. However, the automaker still has to recoup hundreds of millions of dollars invested in developing next-generation electric vehicles, and that’s unlikely to happen for many years, CNN noted.
Ford F-150 Lightning 2024
These next-generation electric cars are expected to prioritize profits as well and lower pricewhile more expensive, next generation electric pickup truck to follow the already delayed F-150 Lightning and a three-row SUV.
Farley also said the cost is on par with internal combustion vehicles may not happen until 2030despite what Ford considers plans to build an LFP battery plant in Michigan key to EV affordability can speed that up. But the real thing is solvable EV profitability matters is the arrival of models in larger numbers than the current Mach-E and Lightning.
