When you click on links to various merchants on this site and make a purchase, this can result in this site earning a commission. Affiliate programs and affiliations include, but are not limited to, the eBay Partner Network.
Ford is re-thinking its EV plans, and will place more emphasis on hybrids...I move that I'd also like to see GM do. I'd seriously consider a hybrid Encore GX.
Moderators...I wasn't sure if this thread belonged in EV-Chat or Car Chat.....it seems right on the borderline.
Ford revamps electric vehicle strategy with push into hybrids
The automaker’s EV division has been losing money, but pivoting from all-electric vehicles to hybrid technology could cost Ford up to $1.9 billion more.
A line of 2024 F-150 and Lightning electric pickup trucks at a Ford dealership in Denver in May. (David Zalubowski/AP)
By Aaron Gregg and Maxine Joselow
Updated August 21, 2024 at 10:24 a.m. EDT
Published August 21, 2024 at 9:22 a.m. EDT
Ford is revamping its money-losing electric vehicle business, retreating from some plans for all-electric vehicles and instead prioritizing the development of hybrid technology, the automaker announced Wednesday.
The announcement underscores the challenges facing U.S. automakers as they seek to boost sales of EVs, a crucial technology in the fight against climate change, despite flagging consumer demand, supply chain challenges and increased competition with Chinese carmakers.
Ford is scuttling plans for a three-row electric SUV and spending less of its total resources on all-electric vehicles, withannual capital expenditures dedicated to pure EVs declining from about 40 percent to 30 percent.
Still, executives said production will begin on an all-electric commercial van in 2026. The automaker also has plans for two more electric pickups and long-range SUVs.
Ford is responding to consumer preferences, company executives said, as many drivers remain concerned about a lack of EV charging infrastructure and affordable EV models.
“We learned a lot … about what customers want and value, and what it takes to match the best in the world with cost-efficient design, and we have built a plan that gives our customers maximum choice and plays to our strengths,” chief executive Jim Farley said in a statement.
Ford is shifting to hybrid technologies for its next three-row SUVs and will take a $400 million write-down for “certain product-specific manufacturing assets,” the automaker said in a news release. The company warned that it may also see “additional expenses and cash expenditures” of up to $1.5 billion.
“We could not put together a vehicle that met our requirement of being profitable in the first 12 months,” Chief Financial Officer John Lawler saidon a Wednesday call with reporters and analysts. “If these vehicles are not profitable based on where the customer is, we will pivot and adjust and make those tough decisions, and that’s what we’ve done.”
The announcement deals another blow to President Joe Biden’s ambitious goal of electric vehicles and plug-in hybrids accounting for half of new car sales by 2030. It comes as EVs have emerged as a flash point in the 2024 election, with former president Donald Trumprepeatedly bashing the technology.
“Unfortunately, the administration’s goals of getting to over 50% market share for EVs by the end of the decade were always bit overoptimistic as were the announced targets by most automakers including Ford, [General Motors] and Stellantis,” Sam Abuelsamid, an auto analyst at the market intelligence firm Guidehouse Insights, said in an email.
“The inability of Ford to develop a competitive, profitable lower-cost EV in the near term is likely to be a major challenge going forward as it faces increased competition from the likes of Hyundai and Kia as well as the future potential from Chinese [automakers],” Abuelsamid added.
The outcome of the election has important implications for federal EV policies, including a tax credit of up to $7,500 for EV buyers. During a campaign stop in Pennsylvania on Monday, Trump said he had not made “any final decisions” on the subsidy.
“I’m a big fan of electric cars, but I’m a fan of gasoline-propelled cars, and also hybrids and whatever else happens to come along,” Trump said.
Ford also said Wednesday that it is delaying production of an electric pickup truck at a Tennessee plant to 2027. Production at the new $5.6 billion plant outside Memphis was initially expected to begin next year.
“In effect, this shifts back a new generation of Ford EVs from 2025 to 2027 — at the very least,” said Corey Cantor, a senior associate for EVs at BloombergNEF, an energy research organization.
Ford’s website still proclaims “the electric era is here,” touting fully electric models like the Mustang Mach-E and the F-150 Lightning pickup. But the company’s electric division reported a $1.1 billion loss, which it attributed in part to “ongoing industry-wide pricing pressure on first-generation electric vehicles.” Sales of the company’s hybrid vehicles, led by the F-150 and Maverick pickups, were up 34 percent in the second quarter of 2024 compared with the same period last year.
Farley said in a recent call with investors that his company has learned from its EV losses and will need to be more disciplined moving forward.
“This means we will not launch vehicles at a loss that are not good for our business, knowing what we know now about the reality of the market equation,” Farley said.
Ford certainly messed up lol. Along with Ford losing $25M a day because of their poor quality which has resulted in massive. recalls. Just more money lost because of very poor forward thinking.
i bet a lot of ford's (and gm's) inability to make profitable ev's is the staggering cost and inflexibility of the uaw (and pensions, healthcare of retirees, etc). whereas their main competitor has no such ball and chain and can proceed rapidly with better and better automation and techniques, using fewer and few people to build profitable ev's.
this move will ultimately crush ford and likely gm too. they'll make money on hybrids in the short term, but when the inevitable tidal wave of low cost chinese ev's also reaches the global market, ford and gm will be left with pocket knives at a gun fight.
From the Nashville Tennessean...Ford trying to put a good spin on the decision......
“Construction continues at BlueOval City, where we are excited to launch our next-generation electric truck, which will build on Ford’s century-long heritage of truck leadership,” Lisa Drake, Ford’s vice president of EV programs and energy supply chain, said in a news release. “While we incorporate new lower-cost battery technology, we will use the extra time to make the truck even more competitive-for the long-term benefit of BlueOval City and beyond.”
i bet a lot of ford's (and gm's) inability to make profitable ev's is the staggering cost and inflexibility of the uaw (and pensions, healthcare of retirees, etc). whereas their main competitor has no such ball and chain and can proceed rapidly with better and better automation and techniques, using fewer and few people to build profitable ev's.
History is repeating but IMO this time it will be much worse than 2009 when GM went under and Ford nearly did.
this move will ultimately crush ford and likely gm too. they'll make money on hybrids in the short term, but when the inevitable tidal wave of low cost chinese ev's also reaches the global market, ford and gm will be left with pocket knives at a gun fight.
In 2010 an EV battery (just the cells) was $1,200 per kWh today it sits at $78/kWh expect that to hit $50 in a few years. To put that context, today a 70 kWh battery costs about $10,000 to produce there is no way any auto maker can produce an engine/transmission for that price. The rest of the car, gas or EV is mostly the same although an EV has less to worry about when accommodating fuel/exhaust/emissions components. Too long didn't read, it is impossible to compete with an EV on cost to produce and that is only going to accelerate. I expect extreme pressure from legacy OEMs to heavily tariff Chinese EVs.
Last edited by LeX2K; 08-21-24 at 12:37 PM.
Reason: clarity
In 2010 an EV battery (just the cells) was $1,200 per kWh today it sits at $78/kWh expect that to hit $50 in a few years. To put that context, today a 70 kWh battery costs about $10,000 to produce there is no way any auto maker can produce an engine/transmission for that price. The rest of the car, gas or EV is mostly the same although an EV has less to worry about when accommodating fuel/exhaust/emissions components.
trying to unpack this.
at $78/kwh, a 70kwh battery is thus $5460, not $10,000, but perhaps you were including the motors as well since you compared it to (ice) engine/transmission, is that right?
but i think i agree with you.
and hybrids are kind of the worst of all worlds having to package ice and electric drivetrains together. there's pretty hard limits on how cheaply that can be made due to the number of parts and complexity.
at $78/kwh, a 70kwh battery is thus $5460, not $10,000, but perhaps you were including the motors as well since you compared it to (ice) engine/transmission, is that right?
Complete battery module is around $10,000 that includes onboard electronics, enclosure, sensors, wiring, insulation etc. the entire thing. I tossed out 10K as a general guide it could be less currently was being conservative.
but i think i agree with you.
and hybrids are kind of the worst of all worlds having to package ice and electric drivetrains together. there's pretty hard limits on how cheaply that can be made due to the number of parts and complexity.
Complexity has gone up the leader in hybrids is now stuffing turbos under the hood.
Complete battery module is around $10,000 that includes onboard electronics, enclosure, sensors, wiring, insulation etc. the entire thing. I tossed out 10K as a general guide it could be less currently was being conservative.
Complexity has gone up the leader in hybrids is now stuffing turbos under the hood.
Those tiny four bangers just don't cut it. Now get behind the wheel of a Model 3 or Model Y, and that smooth buttery power is heaven. Add in 120 MPGe, the ability to "fuel" at home, virtually no maint and no wonder us Californians can't get enough of them
The "new" Lightning is pushed back a year. That's an all new platform, T3, and it's been suggested T3 may sell alongside the current one rather than be a direct replacement. The current Lightning and Mach E are up year on year through July, roughly 80% and 50% respectively.
I strongly dislike them in a mid size or large SUV, which is basically all of them at this point compare the original RAV4 to now. Highlander is now gigantic compared to the 1st generation (I have a 1st gen).
Now get behind the wheel of a Model 3 or Model Y, and that smooth buttery power is heaven. Add in 120 MPGe, the ability to "fuel" at home, virtually no maint and no wonder us Californians can't get enough of them
I'm trying to convince a family member to go EV they refuse to even consider one let alone drive one. They've been in my Y but sill will very likely buy a hybrid with the wheezy 4 banger. I'm of the opinion you will never convince a certain demographic to go EV. Some tropes stick and stick hard, the reasons I hear is mining for EVs is super polluting, won't be able to charge, can't drive in the winter and they cost too much. Also the battery will fail in a few years.
I strongly dislike them in a mid size or large SUV, which is basically all of them at this point compare the original RAV4 to now. Highlander is now gigantic compared to the 1st generation (I have a 1st gen).
I'm trying to convince a family member to go EV they refuse to even consider one let alone drive one. They've been in my Y but sill will very likely buy a hybrid with the wheezy 4 banger. I'm of the opinion you will never convince a certain demographic to go EV. Some tropes stick and stick hard, the reasons I hear is mining for EVs is super polluting, won't be able to charge, can't drive in the winter and they cost too much. Also the battery will fail in a few years.
I let my coworker drive my Y and he ordered one a month later over the protests of his wife, who's anti Elon. He's a Porsche guy who daily drives a Prius...or used to at least .
This is what my company parking lot looks like now
The "new" Lightning is pushed back a year. That's an all new platform, T3, and it's been suggested T3 may sell alongside the current one rather than be a direct replacement. The current Lightning and Mach E are up year on year through July, roughly 80% and 50% respectively.
Last time I looked it was 46 percent uptick in sales for Mach-E and 77 percent uptick for Lightning....but close enough 😀
I let my coworker drive my Y and he ordered one a month later over the protests of his wife, who's anti Elon. He's a Porsche guy who daily drives a Prius...or used to at least .
This family member refuses to drive my Tesla.
Wow going from a Porsche to Prius is quite the......change. Saves a lot of money though so smart.
08-21-24, 11:02 AM
Ford backing away from EV commitment.
.
