I have been following the consumer issues related to electric vehicle operation and maintenance: Battery problems, charging times, and power outages during emergencies are all factors that are not noted in glossy green-energy dialog.
Range anxiety and charger hogs are now terms in the modern lexicon. In June, I reported that a new study found that 46% of EV owners in the U.S. said they were “very” likely to switch back to owning a gas-powered vehicle in their next purchase. Thieves are targeting charging stations for their copper.
This spring, I noted that automotive giant Ford took a massive loss on every electric vehicle (EV) it sold. The firm’s electric vehicle unit reported 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.
Now it is being reported that it would delay the introduction of a new sizeable electric pickup truck by about 18 months to 2027 and scrap a three-row electric sport utility vehicle.
The company is also reducing the amount of money it plans to spend on electric vehicles in an effort to stem multibillion-dollar losses on the technology, while adding plans to introduce a new electric delivery van in 2026. A new medium-size electric pickup is expected in 2027 as well, the company said.“The competitive nature of the market is changing globally,” Ford’s chief financial officer, John Lawler, said in a conference call. “That means these vehicles need to be profitable, and if not, we will pivot and adjust and make those tough decisions.”Mr. Lawler said investments in electric vehicles would now account for about 30 percent of the company’s capital budget, down from 40 percent. The company will take a charge of $400 million to account for the cost of manufacturing equipment it purchased for the production of the canceled electric S.U.V., and it may have up to $1.5 billion in additional expenses related to the project.
The reason for the strategy shift is clear: Customers prefer other types of transportation. And the company wants to be…profitable.
If you’re a potential family car customer who’s holding off on buying an electric vehicle because of high prices and road trip anxiety, Ford is thinking about you. In fact, the automaker is hedging its electric vehicle plans, betting that most consumers would rather buy a hybrid than a full EV.“When you look at the three-row SUV, hybrid technologies or multiple propulsion technologies, for those customers, is the best solution.,” John Lawler, Ford vice chair and chief financial officer, said on Wednesday in a conference call with journalists….The strategic shift reflects Ford’s new requirement for any vehicle to become profitable within 12 months after its launch date — a tall hurdle for an all-electric three-row SUV. Add that to an EV market that’s been cooling on the consumer side even as businesses ramp up their offerings and competitive pressures, and Ford’s leadership saw fit to change course.
In fact, Ford now seems to remember that profit is a good thing.
The automaker previously said it would not launch a vehicle if there wasn’t a clear path to profitability within the first year. It was a change from selling EVs at a loss to grow share and assist in meeting fuel and emissions standards.Ford said it will continue to produce and update its current all-electric vehicles such as the Ford Mustang Mach-E crossover and F-150 Lightning pickup truck.The company said it plans to provide investors with an “update on electrification, technology, profitability and capital requirements” in the first half of 2025.
In conclusion: Market forces are real…and they are spectacular.
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