Ford will lose $4.5B on electric vehicles this year
CEO Jim Farley says company’s future offerings ‘will blow people away’
While Ford Motor Co. and its gas engines are as popular as ever, its electric vehicle unit is expected to lose $4.5 billion in 2023, the company announced last week.
That loss comes even though revenues for Ford Model E, the company’s electric division, grew by 39% for first-generation models, year-over-year. Ford CEO Jim Farley vowed that the EVs to come will “blow people away.”
“The near-term pace of EV adoption will be a little slower than expected, which is going to benefit early movers like Ford,” Farley said in the announcement. “EV customers are brand loyal and we’re winning lots of them with our high-volume, first-generation products; we’re making smart investments in capabilities and capacity around the world; and, while others are trying to catch up, we have clean-sheet, next-generation products in advanced development that will blow people away.”
Michigan Gov. Gretchen Whitmer wants 2 million electric vehicles on the road by 2030. In Washington, President Joe Biden is all-in on using the federal government to accelerate the EV transition, from offering heavy subsidies for buyers, to giving states money to build charging resources, to using regulatory pressure to make the gas engine extinct.
The collection of subsidies and favors for the EV industry helped Michigan double its EV numbers in one year, up to 37,000 in 2022. Ford also recently received a $9.2 billion loan from the U.S. Department of Energy for its three EV facilities down south — two in Kentucky and one in Tennessee.
But even with all that help, Ford did not turn a profit building electric vehicles. Meanwhile, its gas engines are still popular. Ford vehicles were the top sellers in America for the first six months of 2023, the company said.
Ford Blue, its gas engine division, is expected to earn $8 billion for the year. But its EV effort continues to be a struggle.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.