Top American automaker Ford hemorrhaged over a billion dollars on electric vehicles (EV) in the first quarter, leading to massive losses per vehicle.
Ford sold 10,000 vehicles in its EV Model e unit in the first three months of the year, losing $1.3 billion on the line altogether, equating to a loss of $130,000 per vehicle sold, according to data from the company’s first quarter earnings report. Despite the loss on EVs, Ford’s net income was $1.3 billion, selling over a million vehicles with $42.8 billion in revenue in the quarter. (RELATED: Boeing Posts Massive Loss Following Slew Of Safety Issues)
The Biden administration has sought to boost demand and production of EVs as part of the president’s sweeping environmental agenda, offering a $7,500 tax credit for some EVs in an attempt to ease high costs using funds from the $750 billion Inflation Reduction Act. Federal regulators have also put in place tailpipe emission standards for consumers that will effectively require 67% of all light-duty vehicles sold after 2032 to be electric or hybrids.
“Ford Model e revenue was down, as wholesales declined and significant industrywide pricing pressure continued to affect electric vehicles currently on the market,” the company’s first quarter report reads. “The segment had an EBIT loss of $1.3 billion, with costs that were flat year-over-year. The company expects EV costs to improve going forward, but be offset by top-line pressure.”
I like how Ford breaks their earnings out by division.
You can see how much of a disaster the EV market is. pic.twitter.com/0ig3TGdijj— Frog Capital (@FrogNews) April 24, 2024
Sales for Ford’s EV line were down 20% compared to last year, and revenue was down 84%. Ford’s combustion engine line, Ford Blue, sold 626,000 vehicles, which is a decline of 11% from last year, with revenue down 13% in that same time frame.
Not all EVs sold by Ford fall under its Model e unit, with commercial fleets being sold under the Ford Pro unit, including an unspecified number of EVs, according to the earnings report. The Ford Pro unit sold 409,000 vehicles, up 21% since last year, with revenue up 36%.
Ford lost $4.7 billion on EVs in 2023, higher than the $4.5 billion loss the company predicted mid-year. Other automakers have seen similar losses on EVs, such as General Motors, which reported a $1.7 billion loss in the fourth quarter of 2023.
EV demand across the whole U.S. economy slowed in the first quarter of 2023, with growth in EV sales decelerating to 2.7% compared to 5% for all vehicles. As a result, EVs’ market share dropped from 7.6% to 7.1%.
Ford did not immediately respond to a request to comment from the Daily Caller News Foundation.
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