Ford lost billions of dollars on its electric vehicle (EV) product lines last year, according to corporate documents.
The company lost $4.7 billion on EVs in 2023, a greater loss than the $4.5 billion the company expected it would lose in 2023 at mid-year, according to a summary of the company’s annual earnings. The company pointed to “an extremely competitive pricing environment” as a key reason for the losses.
Ford sold 72,608 EVs in 2023, meaning that the company lost nearly $65,000 on each EV that it sold. The company is expecting to lose between $5 billion and $5.5 billion on its EV products in 2024, according to the earnings document. (RELATED: Morgan Stanley Throws Cold Water On Biden’s Lofty EV Targets)
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“The customer insights we’re getting by being an early mover in electric pickups, SUVs and commercial vehicles are invaluable – especially as we’re developing next generation EVs that are going to surprise customers and be profitable within a year of launch,” John Lawler, Ford’s CFO, said of the company’s 2023 results and its outlook for the future. “EVs are here to stay, customer adoption is growing,” added Lawler, who also commended the “long-term upside” of the products.
In January, the company announced that it is cutting production of its F-150 Lightning EV pickup truck amid slower-than-anticipated growth in EV demand. President Joe Biden took a F-150 Lightning for a test drive during a visit to Michigan in May 2021 to promote his administration’s EV agenda, which aims to have EVs constitute 50% of all new car sales by 2030.
General Motors(GM), one of Ford’s main competitors, lost about $1.7 billion on its EV product lines in the fourth quarter of 2023 alone. The company announced in October 2023 that it has dropped a goal to produce 400,000 EVs by the middle of 2024, citing profitability and demand concerns.
The Biden administration is using large government subsidies and aggressive market regulation to push EVs on Americans. Despite these efforts, the industry as a whole finds itself in a tenuous position to start 2024: Ford and several of its competitors are losing vast sums of money on their EV product lines while executives are backing away from short-term production targets.
“We said yesterday that we will launch our second-generation EVs when they can be profitable and deliver the kind of returns we want, and we will build a stand-alone profitable EV business,” a Ford spokesperson told the Daily Caller News Foundation. “Meantime, we’re improving the contribution margin of our first-generation EVs.”
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