Ford Reports Massive Loss on Every Electric Vehicle It Sold
They lose money on every vehicle sold, but make it up in volume.
The electric vehicle market continues to crash and burn.
Last week, it is being reported that Ford took a massive lost on each and every electric vehicle (EV) that it sold.
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.
Furthermore, a new report finds electric vehicles depreciate much more rapidly than those with an internal combustion engine (ICE). And the drop is dramatic….10 times faster than traditional cars.
According to a recent study showing the average used car price for an EV fell nearly 32% in the past year, compared to the decline of 3.1% for gas power vehicles.
Used electric vehicles are depreciating 10 times faster than their gas-powered counterparts, according to a new study from iSeeCars.com. The average price of a used electric vehicle plummeted 31.8% over the last 12 months, compared with a 3.6% decline overall.
“Elon Musk’s initial price reductions on new Teslas were already impacting EV values a year ago,” iSeeCars Executive Analyst Karl Brauer said in a statement. “But his repeated price cuts kept pushing used Tesla prices down, which spread to all electric vehicles, creating weakness across the used EV market.”
Last year, Tesla dropped the price on its standard Model 3 sedan by about 17% and its Model Y long-range version by about 26%. Last month, the company temporarily cut prices on two versions of its Model Y by another 2%.
Finally, I arrive at the news that brings be great joy: General Motors has just announced a big jump in profits for the first three months of the year, based on the strength of its gasoline vehicle business.
The company saw slow growth in electric vehicles, but robust sales of internal combustion vehicles, especially pickup trucks, helped raise its profit to $3 billion in the first quarter, a 24 percent jump from a year earlier. G.M. also said it now expected to make $10.1 billion to $11.5 billion in profit this year, up from a previous forecast of $9.8 billion to $11.2 billion.
Sadly, GM is going to continue with its EV plans. But I am heartened to see that “climate crisis” cultism is being ignored by the consumer.
As I have noted before, until there is a charging infrastructure network that can accommodate the entire American public, an electric grid that can handle capacity, enough natural resources to build models at a moderate price, and technology that doesn’t ignite when it gets wet or won’t start when it gets too cold, EV will remain a niche market.
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And that’s with the government subsidies, right?
Ford and the others got sucked in by the Bidenistas.
You can’t sell not ready for primetime vehicles with minimal infrastructure and expect to succeed.
YOu misspelled ‘Kenyan Fanook…’ 🙂
Elon Musk (Tesla) is a HUGE supporter of electric vehicles.
Yes, he is, but he’s also pointed out the problems such as the lack of infrastructure and the fact that there is not enough solar and wind that can power a nation of EVs.
no CURRENTLY enough
Oh, that’s okay. They’ll make it up in volume.
As for the sales they did get: how many were municipal, state, and federal purchases?
Like the old Saturday Night Live skit -First national Change Bank…
I’m so old I remember when Saturday Night Live was funny….
This YouTube site releases an almost daily video on electric vehicles.
https://www.youtube.com/@MGUYTV
Real depressing for EVs.
“We’ve joined their army, now we must fight to our death.”
Green new deal or trillion dollar boondoggle?
Correction, quadrillion dollar boondoggle.
EV’s don’t run on electricity. They run on subsidies.
And, a used EV is not a used car. It’s a used battery.
It’s simple Marxist economics: When the market presents a choice between an EV and a gas or diesel, the consumer is free to pick whichever.
But when you remove the gas and diesel from the market, now the consumer is free to pick an EV or walking.
For 2025, Toyota will not have a gas Camrys for sale.
That’s insane
They will be hybrids. Last I looked, hybrids like my present ride – a Kia Sorento hybrid – and my past ride, a Chrysler Pacifica hybrid, ran on gasoline.
Toyota’s CEO has written and spoken extensively about Toyota’s decision not to invest his Yen in EVs, his rationale, and the success for nearly three decades of their hybrid engines, which are the best on the market.
https://www.businessinsider.com/toyota-electric-cars-ceo-hybrids-plug-in-silent-majority-resistance-2022-12?op=1
Am considering my next car to be a RAV4 hybrid, my only concern is what is the actual life of tge hybrid battery and its reokacem3n5 cost? The 2 figures for lifespan are 3-5 years and 10-15 years, that’s quite a difference with no in-between guesstimates. So which is real bad which is not? And replacement price is quoted as $1,500 to $6,000? The higher sticker price and lower battery lifespan and higher replacement life would kill any gas savings.
Drove a Gen 3 Prius for a number of years. It ran on gasoline, of course, and it had impressive mileage. I averaged about 51 mpg in city/suburban driving. I had previously driven a Buick that on a good day was about 17 mpg, so it was a big win for me in that regard.
Of course, folding my 6’4″ frame into a Prius wasn’t such a big win…
Loved my 2-door 1997 4-banger Geo Tracker (Suzuki Sidekick). Had MORE room (including headroom) for a 6’6″ 300lb. driver than any of the larger jeepy alternatives, including full-sized Jeep vehicles. Got excellent gas mileage. Even towed a work trailer regularly. When the engine flew apart, looked for a replacement. Couldn’t even find a 2-door anything with 4WD (necessary to reach many of my customers out here). Learned you could still buy the successor to this exact vehicle anywhere in the world… except the USA. (Canada no problem.) Gee, I wonder why.
Given California’s electricity woes, choosing between an EV and walking is choosing between walking and walking, where one fills up your garage and the other doesn’t..
The CEO of Toyota who had received a ton of criticism over his reluctance to embrace EVs and instead push all-in on hybrids is looking surprisingly prescient. My daughter has owned a 2024 Camry for a few weeks and in highway driving, is getting an astonishing 50mpg+. My wife has a hybrid SUV (PHEV) and she can go weeks without having to fill up but has none of the range anxiety of driving an EV. I drove an EV for about 6-mos and while it was fine around town, any trip over 100-miles was borderline disaster because there simply aren’t enough places to charge these things. When’s the last time people driving ICE vehicles and to give any thought to where they were going to get fuel on a long trip? The 1920s?
EV trucks and SUVs simply make no sense and EV sedans don’t make much sense with hybrid counterparts are getting 50 MPG or more.
Rooftop solar isn’t going to do it for Japan, considering average family lives in tiny condo/apartment. While Japanese are extremely reluctant to build more nuclear power reactors after Fukushima melt down. Wind turbines will never make up that difference. Taxis are natural gas powered in Japan.
I had 2 hybrids, Prius, never again. Once the battery goes it’s all downhill, poor resale and that battery is not recyclable
Nightmare
Not even the 1920’s because you simply loaded up some extra gas cans.
As Ford goes deeper down the rabbit hole with this EV business, I have to winder if they’re damaging their reputation enough that GM might be able to overtake them in the pickup market.
Of course, as you noted, GM is also trying to push EVs, but they don’t seem to be quite so publicly “all in” on it like Ford.
Ford could be killing themselves in more ways than one. Their ICE vehicle sales are what allow them to absorb the enormous losses they’re sustaining in EVs, if they start losing ICE market share…especially in light trucks, that could spell their doom.
Of course, they’re “too big to fail” (and have massive unions who donate and lobby in DC extensively) so I suppose they’ll just have to ask for government handouts like GM did in the past.
Or you can think of it in business terms where they are spending the resources to ‘go electric’ and writing off the losses to counterbalance the profits they make off massive gas/diesel trucks. If they had not made these investments, a giant lump of cash would have escaped their grasp and winged its way to Washington.
I bought 2002 F550 with the 7.3 diesel in very good condition last year. Every diesel engine they have produced since has been inferior, though that is government’s fault. They just couldn’t leave a good thing alone.
Besides all the losses on RV’s for the last few years Ford has lead the auto industry in recalls. The poor quality of Ford products and seemingly never ending recalls has moved people away from the brand and this is coming from a Mustang owner.
Ford was also the only one that broke out their EV business into a separate division which means that it’s very plain to see that it cannot stand on its own.
“that GM might be able to overtake them”
GM beats Ford in the truck market quite handily and has for several years. Fords claim to #1 is based on brand (ford Vs chevy, leaving out GM’s other truck brands).
GM out sales Ford by roughly 10%
“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.”
In other words, it’s clickbait. “Far beyond” means we added in fixed costs to fudge the numbers. The IRS doesn’t even let you do that, you have to capitalize the costs so only a little of it offsets profits.
Not a Generally Accepted Accounting Practice.
So, Ford isn’t reporting GAAP?
Someone call a bunch of three letter agencies. IRS, SEC and I am sure a bunch of others.
The climate cultists keep trying to push this crap where I live, which is patently ridiculous because not only do we lack the necessary infrastructure, it’s also one of the coldest places in the lower 48. Winter temps of -40F are the norm.
Gonna call BS on that.
Common -40 wind chill, maybe; -40 static temps common? I don’t think so.
Please provide links to daily high/low temps in your area so I may peruse them.
(Says DJ, who lives in the coldest state in the lower 48)
This is false. If you live in the USA, there are no average winter temps of -40 F. You are just making s__t up.
Have you never heard of this place called alaska? I’m pretty sure that’s in the United States
Do you not know what “lower 48” means in SField’s above comment? His claim is about one of the lower 48 (contiguous) states, which excludes Alaska.
Plus, JR specified average winter temps in his response, and he’s correct in that claim.
That’s not a correct summary. What the study found was that “Used EV prices fell 31.8% in February compared with a year earlier; used gas-powered car prices fell 3.6% over the same timeframe”. That doesn’t mean gas-powered cars depreciated by 3.6% over a year. Average depreciation is about 15-20% per year for the first few years of a car’s life. Similarly, the price of a used Porsche 718 Cayman increased 29.4%. That doesn’t mean the Porsche appreciated in value unless you were to claim that a two-year-old Porsche is worth more than when it was new. It just means it depreciated less than before.
As noted, part of the reason used EV vehicle prices have dropped is because of dramatic price cuts for new EV vehicles. Why buy a used Tesla from three years ago when you can buy a new EV for less and with more bells and whistles?
https://www.iseecars.com/used-car-prices-study
Leslie Eastman: But I am heartened to see that “climate crisis” cultism is being ignored by the consumer.
Anthropogenic global warming is occurring whether you like it or not. Meanwhile, global consumers are rapidly moving towards EVs. The United States and lead or follow, export the latest technology or import from others at a cost, but the green transition is occurring.
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You live in dream world. Toyota is world’s biggest auto maker. Top exporters of oil, OPEC + Russia will never give up their single biggest source of currency. Half the world will never adopt EVs. Biden’s green new deal boondoggle won’t lower temps by 1 degree.
smooth: You live in dream world.
We cited actual data.
smooth: Toyota is world’s biggest auto maker.
Toyota to invest $1.4 bil to set up 2nd EV production site in U.S.
smooth: Half the world will never adopt EVs.
Alt-smooth: “Get a horse!“
Biden green new deal is trillion dollar fraud. smh
You are a liar, you lie about everything.
You called Zachariel….
Clearly, you are a climate cultist. Clearly, my derision of your pseudoscience is so upsetting to you.
We are in an interglacial period…and temperatures are always going to get warmer. – with our without humanity. I prefer they do so with me having access to air conditioning.
https://www.usgs.gov/faqs/how-long-can-we-expect-present-interglacial-period-last
Furthermore, carbon dioxide levels were 2000 ppm in the early Eocene period, about 50 million years ago. Humans weren’t a species, there levels are 1500 ppm higher than they are today…and both plants and animals thrived at that time.
https://pubmed.ncbi.nlm.nih.gov/10963587/
Climate cultists cannot embrace geologic history or the significant role the Sun plays i are climate,
Leslie Eastman: Clearly, my derision of your pseudoscience is so upsetting to you.
Merely pointing out the facts.
Leslie Eastman: We are in an interglacial period…and temperatures are always going to get warmer. – with our without humanity.
Simply saying “interglacial” doesn’t indicate whether the Earth will get warmer or cooler. The USGS link you provided indicates that the length of the natural interglacial is not known with certainty. However, recent studies have shown that the next natural glacial period has been postponed for about 100,000 years. See Ganopolski et al., Critical insolation–CO2 relation for diagnosing past and future glacial inception, Nature 2016.
Leslie Eastman: Humans weren’t a species, there levels are 1500 ppm higher than they are today…and both plants and animals thrived at that time.
Sure. And life will survive anthropogenic global warming. But you wouldn’t want to suddenly thrust the Earth into a climate regime associated with the Eocene, wherein the Eocene Optimum saw sea levels 150 meters higher than at present.
Regardless, anthropogenic global warming will cause substantial disruption of human civilization, which has developed over a long period of relatively stable climate. Global warming will destabilize ecosystems, inundate coastal settlements, hinder agriculture, and induce mass human migration with all the attendant social and political disruptions that entails.
The key is that much of the worst aspects of global warming can be avoided, even though some damage and costs are inevitable. Humans can adapt and humans can mitigate. It is cheaper in the long run to address the problem earlier rather than later, which will also avoid more permanent damage to humanity’s shared natural inheritance.
Leslie Eastman: Climate cultists cannot embrace geologic history or the significant role the Sun plays i are climate
Turns out that scientists do study the sun and the role of greenhouse gases in Earth’s climate history. Indeed, the history of Earth’s climate can’t be understood without accounting for the role of the sun and of greenhouse gases.
As noted above, you’re a liar.
You don’t “point out facts”, you make them up.
Everything, and I do mean everything, you state is a fabrication.
You sound triggered Barry, if Zachriel is incorrect why not cite something that corrects him. Of course that would involve you actually looking at the claims and trying to understand them with actual evidence
Its pretty damning to your case when the article you cite states “No one knows for sure.” as the opening statement and “Other workers have suggested that the current interglacial might last tens of thousands of years”. Do you even read the articles you cite!?
” Used electric vehicles are depreciating 10 times faster than their gas-powered counterparts
That’s not a correct summary. What the study found was that “Used EV prices fell 31.8% in February compared with a year earlier; used gas-powered car prices fell 3.6% over the same timeframe”. That doesn’t mean gas-powered cars depreciated by 3.6% over a year.”
Fer Christ sake — you know the guy, sorry — that’s a perfectly correct summary; *literally* what it says, per your quote. You may object to the sampling, offer a contextual framing, claim the observation is over-generalized(*), or any number of other things. BUT, that’s literally what it says in what you quote.
“This here depreciation number. That there depreciation number. This one divided by that one is about 10.” Jeesus — sorry — go talk to your friend. By all accounts, he could count.
Zachriel’s math is as good as his climate science.
Ironic since you cant seem to come up with a coherent response to said maths
BierceAmbrose: that’s a perfectly correct summary; *literally* what it says, per your quote.
The article conflates depreciation with the change in the resale price. They measure different things. As noted, the claim would mean the depreciation on gas-powered cars is 3.6% annually, which is not correct. Consider a new car which sells for $100,000. After a year, it has a resale value of $90,000, a depreciation of 10%. If the price of the one-year-old car then drops to $80,000, the price of a one-year-old car has dropped 11%, while depreciation has increased 100% (doubled from 10% to 20%).
More lies and bafflegab bullshit. It’s all you do.
That’s a coherent objection, also succinct, on point, and impersonal. Thanks for that.
Best of all, that’s a testable objection. (Talking like that, we might all learn something, in common even. We better be careful with that. Can’t generate understanding, let alone common understanding. No political fodder in common understanding — what would we get all wee-wee’d up about? How Dare Us!)
One thing I take from this is noticing “depreciation” seems to have both colloquial, and term of art meanings. Another is that often the term of art and colloquial are the abstract thing, and a proxy, respectively. (We see this same structure with several domain experts who speak up around here.)
I’m reasoning about colloquial vs term of art by analogy from radioactive decay — there’s an abstract decay rate / stability constant, and a proxy emission which we can measure. We talk about “decay” and “decay rate” using the proxy all the time, including even technical applications where it’s good enough.
AIR, there’s a couple deeper abstraction steps in nuclear, meaning narrowly “of the nucleus” (another colloquial / formal pair, that) stability. I’m not recalling the particulars — my exposure was course work decades ago. BUT, perspective-shifting seeing an isotope chart that looks kinda like a periodic table with items tagged with decay rates, energy bands, emissions, and other stuff.
EV, buy it for the virtue signaling, keep it to roast hot dogs.
During the Covid insanity my Cadillac dealer offered me MORE than I paid for my then 3 year old XTS.
Somebody could buy up year-old, electric trucks, convert them to gas and make a fortune.
Redneck EV conversion kit:
https://twitter.com/brechtcastel/status/1570425739811459075?lang=en
I don’t know anything about corporate accounting but I guess they can write off losses in way similar to when I sell a stock at a loss and reflect that on my capital gains.
If EVs are so damn good then there’s no need for mandates or subsidies. Consumers will adopt them on their own.
For that to happen they would have to large and significant advantages over what we already have access to. They don’t.
“As I have noted before, until there is a charging infrastructure network that can accommodate the entire American public, an electric grid that can handle capacity, enough natural resources to build models at a moderate price, and technology that doesn’t ignite when it gets wet or won’t start when it gets too cold, EV will remain a niche market.”
HOW DARE YOU!!??!!
“But I am heartened to see that “climate crisis” cultism is being ignored by the consumer.”
“Sure, save the planet. Just Not In My Attached Garage!”
Where are the stock holders. If I owned Ford stock, I would be fuming and asking for the CEO and Board of Directors to resign.