Ford losing almost $60,000 for every EV it sells; ICE & CVs keep it profitable

RahulNagaraj · 9th May 2023, 15:46

Ford recently revealed its earnings for the first quarter of 2023. According to reports, the American car brand's EV operations seem to be losing out heavily, while its ICE and commercial vehicle sales are what's keeping the company profitable for now.

The American car giant listed the earnings of each of its three divisions: Ford e, Ford Blue and Ford Pro. As the names suggest, Ford e looks after the brand's electric vehicles and digital connectivity, Ford Blue deals with ICE-powered passenger vehicles, while Ford Pro is the commercial vehicles division.

Ford losing almost ,000 for every EV it sells; ICE & CVs keep it profitable-fordmustangmache1.jpeg

As per the earnings reports, Ford e lost $700 million in the first quarter of 2023, registering just 12,000 EVs during the period. This translates to losing an average of $58,333 per electric vehicle sold in the first 3 months of 2023. This is compared to the brand's revenue during the first quarter of 2022, when it registered $1.6 billion.

The reason for the loss is due to the reduced volume because of the scheduled downtime at Ford's plant in Mexico, which produces the Mustang Mach-E. The temporary shutdown is to help increase the plant's production output to 2,10,000 per year by the end of this year. The carmaker is also said to be haemorrhaging cash to scale production. Ford is said to have spent $3.5 billion on its battery plants in Michigan, as well as its Tennessee plant, which will produce Ford's next-gen electric truck in 2025 with a capacity of 500,000 units per year.

Ford Blue, on the other hand, reported a gross income of 2.6 billion in the first quarter, led by the F-150. Ford is also America's leading truck manufacturer, producing one every 30 seconds. This combined with Ford Pro, helped the carmaker register a profit with a 4.2% net income margin.

Ford is also predicting the company to register a $3 billion operating loss for EVs in 2023. However, with production and facilities scheduled to improve, Ford is hopeful to turn things around in the coming years.

Source: CarScoops

Link to Team-BHP news

SKC-auto · 9th May 2023, 16:26

I'm glad that Ford is reporting their EV numbers separately.

Just like Tesla, Ford E is currently facing losses due to investments in factories, vehicle design, and battery materials.

However, Ford understands that profitability will increase once they scale up their operations.

AnkitHJain7 · 10th May 2023, 12:59

The headline is definitely catchy and clickbaity, but all in all it isn’t anything to worry about. It makes it sound like the vehicles themselves cost too much and sell for way too less.

Ford is investing in their EV manufacturing capacity. I’m glad they’re seemingly not worried about the short term burn and focused more on the long term. If this burn doesn’t start slowing in the next year or two, then I think it’s a cause for concern. As of now, it’s nothing out of the ordinary.

9th May 2023, 15:46	#1
RahulNagaraj Senior - BHPian Join Date: Mar 2021 Location: Bangalore Posts: 2,666 Thanked: 25,331 Times View My Garage	Ford losing almost $60,000 for every EV it sells; ICE & CVs keep it profitable Ford recently revealed its earnings for the first quarter of 2023. According to reports, the American car brand's EV operations seem to be losing out heavily, while its ICE and commercial vehicle sales are what's keeping the company profitable for now. The American car giant listed the earnings of each of its three divisions: Ford e, Ford Blue and Ford Pro. As the names suggest, Ford e looks after the brand's electric vehicles and digital connectivity, Ford Blue deals with ICE-powered passenger vehicles, while Ford Pro is the commercial vehicles division. As per the earnings reports, Ford e lost $700 million in the first quarter of 2023, registering just 12,000 EVs during the period. This translates to losing an average of $58,333 per electric vehicle sold in the first 3 months of 2023. This is compared to the brand's revenue during the first quarter of 2022, when it registered $1.6 billion. The reason for the loss is due to the reduced volume because of the scheduled downtime at Ford's plant in Mexico, which produces the Mustang Mach-E. The temporary shutdown is to help increase the plant's production output to 2,10,000 per year by the end of this year. The carmaker is also said to be haemorrhaging cash to scale production. Ford is said to have spent $3.5 billion on its battery plants in Michigan, as well as its Tennessee plant, which will produce Ford's next-gen electric truck in 2025 with a capacity of 500,000 units per year. Ford Blue, on the other hand, reported a gross income of 2.6 billion in the first quarter, led by the F-150. Ford is also America's leading truck manufacturer, producing one every 30 seconds. This combined with Ford Pro, helped the carmaker register a profit with a 4.2% net income margin. Ford is also predicting the company to register a $3 billion operating loss for EVs in 2023. However, with production and facilities scheduled to improve, Ford is hopeful to turn things around in the coming years. Source: CarScoops Link to Team-BHP news Last edited by RahulNagaraj : 9th May 2023 at 15:47.
	(5) Thanks

9th May 2023, 16:26	#2
SKC-auto Senior - BHPian Join Date: Jan 2020 Location: KA01/AP31 Posts: 1,314 Thanked: 3,970 Times	Re: Ford losing almost $60,000 for every EV it sells; ICE & CVs keep it profitable I'm glad that Ford is reporting their EV numbers separately. Just like Tesla, Ford E is currently facing losses due to investments in factories, vehicle design, and battery materials. However, Ford understands that profitability will increase once they scale up their operations.
	(8) Thanks

10th May 2023, 12:59	#3
AnkitHJain7 BHPian Join Date: Feb 2014 Location: Dallas/Chennai Posts: 39 Thanked: 374 Times	Re: Ford losing almost $60,000 for every EV it sells; ICE & CVs keep it profitable The headline is definitely catchy and clickbaity, but all in all it isn’t anything to worry about. It makes it sound like the vehicles themselves cost too much and sell for way too less. Ford is investing in their EV manufacturing capacity. I’m glad they’re seemingly not worried about the short term burn and focused more on the long term. If this burn doesn’t start slowing in the next year or two, then I think it’s a cause for concern. As of now, it’s nothing out of the ordinary.
	() Thanks