The sky-high loses forced the American automaker to rethink its EV targets and even cut battery orders for future models
It’s tough breaking into the electric vehicle game these days. Startups like Rivian $RIVN and Lucid $LCID have posted massive losses while launching their lineups, General Motors $GM has been slow to ramp up production of EVs and now Ford $F has shared some truly eye-watering losses from its own electric arm at the start of this year.
The blue oval reportedly lost more than $100,000 for every electric car it delivered in the first quarter of 2024, according to a report from Bloomberg. The sky-high loses forced the American automaker to rethink its EV targets and even cut battery orders for future models. As the site explains:
Ford Motor Co. has begun cutting orders from battery suppliers to stem growing electric-vehicle losses, according to people familiar with the matter, as it throttles back ambitions in a rapidly decelerating market for plug-in models.
The move is part a retrenchment of Ford’s EV strategy, which includes reducing spending by $12 billion on battery-powered models, delaying new EVs, cutting prices, and postponing and shrinking planned battery plants. Ford has forecast EV losses of up to $5.5 billion this year and Chief Executive Officer Jim Farley recently said its EV unit, Model e, “is the main drag on the whole company right now.”
The EV unit’s “drag” on the rest of the company is growing. In the first three months of 2024, Bloomberg reports that losses on every EV sold by Ford doubled to $100,000. In fact, the losses on EV sales are so great at Ford that Bloomberg predicts that over the course of this year they could wipe out all profits made by the Blue division, which is the company’s gas-powered car side.
Losses like this are staggering to see, and just go to show how important it is for EV production costs to start falling, quickly. Thankfully, Ford at least appears to be workin on this, with the company announcing earlier this year that it has an electric model in the pipeline that will be both affordable and profitable. Imagine that!
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