Ford Fears Bankruptcy With Every EV Sold
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- Опубликовано: 1 июн 2024
- Ford’s electric vehicle unit reported that losses soared in the first quarter to $1.3 billion, or $132,000 for each of the 10,000 vehicles it sold in the first three months of the year, helping to drag down earnings for the company overall.
Ford, like most automakers, has announced plans to shift from traditional gas-powered vehicles to EVs in coming years. But it is the only traditional automaker to break out results of its retail EV sales. And the results it reported Wednesday show another sign of the profit pressures on the EV business at Ford and other automakers.
The EV unit, which Ford calls Model e, sold 10,000 vehicles in the quarter, down 20% from the number it sold a year earlier. And its revenue plunged 84% to about $100 million, which Ford attributed mostly to price cuts for EVs across the industry. That resulted in the $1.3 billion loss before interest and taxes (EBIT), and the massive per-vehicle loss in the Model e unit.
The losses go far beyond the cost of building and selling those 10,000 cars, according to Ford. Instead the losses include hundreds of millions being spent on research and development of the next generation of EVs for Ford. Those investments are years away from paying off.
And that means this is not the end of the losses in the unit - Ford said it expects Model e will have EBIT losses of $5 billion for the full year.
The company said it is its “intention” to be have EV pricing cover the actual costs of building each EV, rather than covering all the research and development costs, within the next 12 months. But a price war among EVs for about a year and a half has made even that measure of profitability very difficult said Ford CFO John Lawler. He said while Ford has removed about $5,000 in cost on each Mustang Mach-E, “revenue is dropping faster than we can take out the cost.”
In 2023, Ford Model e reported a full-year EBIT loss of $4.7 billion on sales of 116,000 EVs, or an average of $40,525 per vehicle, just more than a third of the first quarter loss.
Model e doesn’t handle all of the company’s electric vehicle sales. Some are also sold in its Ford Pro unit, which handles fleet sales to businesses and government buyers. And Ford said it had strong demands for electric vehicle sales in that unit, including an order for 9,250 E-Transit vans from the US Postal Service, which are to be delivered through the end of this year, and an order for more than 1,000 of its F-150 Lightning pickups and Mustang Mach-E SUVs from Ecolab, a global sustainability company.
Despite the EV losses, Ford CEO Jim Farley said in a call with investors the company is making changes in its EV business, and that the company’s planned next generation of EVs will allow it to be profitable on that business in the near future.
Ford Pro, which primarily sells traditional internal combustion vehicles, was the primary profit driver for Ford in the quarter, posting EBIT of $3 billion, or more than double what it made a year ago, as revenue from the unit rose 36% to $18 billion. The number of vehicles sold by Ford Pro was up 21% to 409,000.
But Ford Blue, which handles sales of gasoline-powered cars to consumers, reported that sales fell 11% to 626,000, and revenue dropped 13% to $21 billion. That resulted in EBIT in those traditional sales falling by nearly two-thirds to $905 million.
Together Ford Blue and Ford Pro produced roughly the same level of profits as a year earlier, but the increased losses at the Model e unit meant that Ford’s overall net income fell 20% to $1.3 billion, while its adjusted earnings per share fell to 49 cents, down 21% from a year earlier, but slightly better than analyst forecasts of 44 cents a share.
Ford rival General Motors reported earlier this week that it remains on track to have its North American EV business turn profitable in the second half of this year, while Stellantis, which makes cars and trucks in North America under the Jeep, Ram, Dodge and Chrysler brands, said its European EV business was already profitable last year.
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NO ONE WANT THOSE DAMM EV TRASH! GROSSLEY OVER PRICE, LIMITED ON RANGE, TOOO MUCH RECALL! NOOO THANKS
I am a disabled 66 year old man and my last vehicle finally quit running three years ago. I use Uber once or twice a week but I never go more than thirty miles, so it isn't all that expensive to go shopping, out to eat, the movies, etc. While strolling about, I walked onto a Ford dealership to check out the cars and trucks. I laughed so hard snot was coming out my nose. I looked at one Ford truck and it had a sticker price of $105.000! The cheapest one had a puny V-6 engine and it was $79.000! These car makers are out of their frigging minds. I laugh even more when Biden wraps himself in the UAW banner during campaign visits, and talks proudly about "Made in America---the envy of the world". The stage is always chock full of the clods who make these overpriced rattle traps. The hourly pay these clods are getting is way out of line compared to what auto workers in Germany, South Korea, Japan, China, Italy, France, etc. are getting.
The change needs to be at the top. They are raping the company built by employees
So Ford is saying it costs almost $200 000 to make every Lightning? I think someone there needs to figure out how to make vehicles again.
Protecting them from the real competition will just weaken manufacturers.... And we're likely to see China be very thoughtful about how to hurt us the best in trade
Another example of the Car companies thinking they know what the consumer wants, more than the consumer does! I've always liked sedans and station wagons...but about 15 yrs ago, the big 3 saw that they could make tons of money off of Pickup & SUV'S ( because of bigger mark-ups on them compared to sedans ) which equates to waaaay more company profit. So what did they do? They forced SUV'S/Trucks on us by ending production on sedans over the next 10 yrs. They along with the gov't (Obama who bailed out GM & Chrysler/Dodge.. and later Biden who told us Americans want all EV's by 2030) .. constantly told us through the media and fudged data, we only want SUV'S/Trucks. If there are no sedans to buy, what else is there to buy? The American public once again, has been 'Hoodwinked'
The SUV acronym literally came from the mpg regulations which exempted sports/utility vehicles. They could still make sedans but they had to essentially be compact cars to comply, which most people don't want. An SUV or truck was the only full sized vehicle they were allowed to make, not their choice.
@@user-jb2om7cm8m ..I hear you and I am familiar. But please explain: AUDI, BMW, VW, MERCEDES, HONDA, HYUNDAI/KIA, TOYOTA/ LEXUS, NISSAN/INFINITY, and VOLVO! every last one of those companies still make sedans and SUVS and some pickups, sold in America. And people still buy their sedans which most are midsize but some are large luxury vehicles. I'll listen while you make another excuse defending why the poorly run big 3 no longer make sedans. By the way, outside of the FORD Fusion name me some sedans that the big 3 make? (I'll help you out, Caddy makes 3, Ford and Chevy make NONE !)
@@PopsRacer61 Sure, they can make sedans, but not as large and comfortable as they used to be, so people prefer SUVs which are less compromised. Those other auto makers sell in the US, but sell a lot more in Europe/Japan etc where gas and taxes are higher on larger vehicles.
Caddy and Chevy are both GM. Chevy has made trucks for>100 years, Cadillac has always been associated with sedans so I'd say that's more a branding thing.
F150 has been the best selling vehicle in the US for decade, so Ford has done a great job focusing on that lucrative market.
@@user-jb2om7cm8m ..hate to break the news to you but the FORD F-150 has been the top selling Truck in the world for quite a few years. But as far as vehicles go in America (which you stated) ..the Toyota Camry since 2002 has been the top selling vehicle in America surpassing...YES, the F-150! The Camry is a sedan by the way that's been made in America along with the Honda Accord, and people fit in it very well. Stop making excuses for the dilapidated Big 3. They cannot compete globally anymore, and here in America they tried to convince us that EV'S are the here and now. All because they saw how well Elon Musk did. Everyone is copying MUSK/TESLA, who by the way make 2 sedans, an SUV, and an ugly pick up. I'm still waiting to see how many Americans will wait in line to buy the avg pickup that costs between $50 &70k. Those that can afford those prices have already done so. The rest of us can't or won't pay those ridiculous prices. The bubble is about to burst on the American Auto Co's bcs instead of continuing to make sedans and Hybrid vehicles ppl can afford , they chose to make expensive EV'S and only pick ups/SUV'S. Looks like they got caught with their pants down to me!
@@PopsRacer61 Motortrend : "To no-one's surprise, the Ford F-Series pickup family was America's best-selling vehicle for the 42nd year in a row (2023), with more than 745,000..."
carfigures:
Toyota sold 290,649 Camry in 2023.
Not sure where our discrepancy in figures lies- but it can sometimes get confusing where they split submodels up in the figures etc, or include used sales?
But on top of that, pickups and SUVs have more profit margin, and have a high percentage sold for commercial use.
I think we agree on the EV mistake, but again that was under pressure from the govt, not consumer demand, they are all compelled to produce 'compliance' cars.
I blame Biden for the mess with electric vehicles. NO ONE wants them now because not only are they expensive to begin with but when it comes to replacing the batteries, the cost is insane and there aren't enough trained mechanics to work on them. I feel these vehicles were forced on us and I resent it. I decided to buy a used Dodge Challenger w/V8! When I buy a pickup next, it will be used with a V8. No turbo 4 or 6 cylinder powered truck at $100,000 for me and certainly NO ELECTRIC VEHICLES either.
This was Ford’s decision. You don’t see Toyota going full bore into electric vehicles, even though they have to comply with all the same rules as Ford. It’s bc Toyota makes prudent decisions. Ford got carried away. They wanted to be the leader in EVs. And now they’re paying for it.
@@damnjustassignmeone guess you never heard of what the EPA has been doing to auto makers and the need to buy carbon credits just to sell ICE vehicles. This is all Biden
why are evs only for the ultra rich? don't they know that cost of living is soo high now, that not many people have $100,000 laying around just to put into a car.
Few to non are now buying the Mach-E with the Tesla Model Y within a few thousands dollars of the Mach-E. That means it's the Lighting pickup that costing $100,000 over manufacturing costs. The Lighting is the only full size EV from a US legacy manufactures that's a good very likable vehicle. It doesn't have a regular record of bricking and stranding its drivers such as GM's full size EVs.
I just may have to pull my ford stock, smh!!!!!
how can rivian be so unreliable boggles my mind, it's full EV with no engine, shouldn't have any problems at all unless they fisher price the electronics.
Well scripted and presented, and good info to know. I imagine Ford is counting on a government bailout since it was government mandate that forced manufacturers to pursue alternative fuel sources.
Years ago, I bought a new Ford. The brakes failed within the first five thousand miles as I was driving on a highway. I almost died in that accident. The state I was living in investigated the crash and found that the workers at Ford improperly installed the brakes on the vehicle. The radio also failed within the first two thousand miles; I know it is a minor problem. I complained to a Ford Zone Representative, who informed me that once I purchased the vehicle and drive it off the dealer lot, they do not warranty the breaks; it was my problem. I talked to several lawyers who said you cannot win suing Ford; they have an army of attorneys.
I WILL NEVER EVER BUY A FORD vehicle for the rest of my life. Since then, I have purchased several Honda products and a Mercedes-Benz. I have not had a problem with any of those vehicles. The Mercedes-Benz I have has over 280,000 miles, and my latest Honda product has more than 149,000 miles. Frankly, since Ford did not care if I almost died in a car accident, I do not care if Ford goes out of business. FORD = GARBAGE! The next vehicle I purchase will either be a Honda or Toyota; I would not even look at the garbage the big three put on the market - especially not a Ford.
This EV mandate is going to tough on Ford, GM and Stellantis. The government is forcing them to make vehicles that nobody wants. They had to revamp all their factories too. They have over priced inventory along with high interest rates, is a recipe for disaster.
The results of bad business decisions are showing.
I would ride a bike before I ever bought a Range Rover! They are absolute garbage!
Agreed. The old range rovers looked really good but quality was low.
WTF can't they make a light, economical Datsun style truck?
Ford Maverick.
@@pabs5270 I was thinking Fiesta.
Hybrids seem a much better alternative.We don’t have the infrastructure nor in-home charging stations. A hybrid is a perfect mix and recharge themselves.
Yes. I have owned a Ford Fusion Hybrid for 3 years. I see 40 and 50 MPG every day.
More complexity never makes a better product.
No, ICE cars are just fine, and simpler to maintain.
I bought a Toyota Highlander hybrid and love it. I’m not a tree hugger, my other vehicle is a diesel powered 2500. Toyota has the hybrid process down!
It is utterly shocking, bewildering and unbelievable that Ford, GM or Chrysler would ever make a bad decision. I am just stunned beyond belief. 🤪🤪🤪🤪🤪🤪
Stop building the damn SUVS. They are money pits
👍🙏💯💯
Great info! Every single EV startup, which includes Ford, GM, and now Stellantis, will face massive losses in the beginning. Tesla faced it more than once. Fisker is tanking as we speak. Lucid and Rivian are far from in the clear. Musk slept in the production plant during the ramp of the Model 3. It was a make or break vehicle. Thanks to the consumer reception, they couldn't build enough and quickly got to economies of scale. They INNOVATED in the production process, which gives them crazy margins. You can take an existing chassis and add batteries and motors but you're adding more complexity to an inefficient legacy production process. Now factor in this list of predicted reliability for legacy and we understand why consumers aren't trusting them with a new technology.
In the beginning??? No, from beginning to end. When BYD can produce a better EV for a FRACTION of the price it is game over in that space. Once the Chinese have a Mexican factory the vehicles will ship in tarrif free.
@@MikeS-7 Uhhh. ... that's why they're sitting in European ports taking up space being counted in sales numbers?
There's no way I buying EV vehicles it costs to much 😮!!
Nice Subaru furniture in the background!
Hybrids were always the answer. They should have listened and stay that course.
Excatlly
I agree. My son has a Ford C-Max and loves it.
EV cars Sucks
Tesla is making a profit selling EVs for $38.9k (before any tax credits). BYD is making a profit on EVs costing something like $11k. Maybe we should just give up on EV subsidies, because they are no longer needed to make affordable EVs. If Ford can only make a profit selling expensive trucks and SUVs, let them keep working that angle for as long as it lasts.
That's not true. Tesla makes a profit, but their cars lose money. Without subsidies, their charging network, and without sales on services and financing, Tesla would be losing money. This is even more the case with BYD, but BYD is state backed and doesn't have to worry about things like. They basically have a blank check for operation.
@@allentechpt9026 No doubt BYD is getting support from the government and that Tesla benefits from other government support. However, there is so much government money going into everything - including significant amounts of money being poured into subsidies for the oil and gas industry, that what is actually competitive is very unclear. However, the investment of support for the EV industry has led to the production of excellent vehicles that are fairly competitive. Strip away the subsidies and you will see several companies survive. They probably won't most be 'legacy auto'.
@allentechpt9026 That's not true. Tesla vehicles are hugely profitable. None of that makes a dent into their bottom line. Musk actually fought against the subsides. The $7500 per vehicle results on qualification. It wasn't an automatic thing and the carbon credits they sell to legacy barely account for anything on the bottom line. BYD and Chinese companies only make it because they reject HUGE govt subsidies directly PLUS credits to the consumer. Tesla could give away all their margins and still remain solvent just on volume. Tesla has millions of cars that get free supercharging plus all their cars come with charge at home kits. Sales is direct so money to be had there. There cars have the LEAST required maintenance in the country. No money there. Tesla JUST started experimenting with financing and insurance to make their vehicles more affordable. Not a bank like like GMAC or FMC where stealerships are allowed to rape you.
Are they making money because they keep laying off people? Thereby affecting the bottom line?
@@robshaw2990 You missed the part where EVERYONE had been laying off? That happens every few years to take out unnecessary redundancy. Tesla just went through an explosive growth and now that they've maximized efficiency they realized the opportunity. Another wave is coming and they'll probably repeat the same cycle with explosive hiring.
Their fault for jumping the gun and quickly drinking that koolaid from elon musk 👎🏽
SIMPLE SOLUTION- ALL Automotive manufacturers SHOULD QUIT producing EVs. The DAMNED THINGS ALL SUCK, and NO ONE WANTS THEM, ANYWAY...
Ford EV Division. Building a house on a bog.
what about the warranty claims. electrict battery car is what is should be called not electric cars
Oh Biden should pay out of his pocket. All the blues will never change.
Farley along with the rest of Ford's top management are morons. Ford needs to go back to building what people want. Quality affordable vehicles with V8s. Not EVs. Not turbocharged 4 and 6 cylinder crap boxes.