Ford Losing $36,000 On Every Electric Vehicle It Sells

Ford has announced that it will cut back on electric vehicle investments following a rather challenging third quarter, in which the Blue Oval saw losses of $36,000 on every EV it sold during this period.

In its latest earnings report, Ford conceded that its Model e division — which focuses on electric vehicles and future mobility — posted losses of $1.3 billion between July and September 2023. The automaker says this significant loss can be attributed to «continued investment in next-generation EVs and challenging market dynamics.»

Interestingly, sales of electric vehicles increased in the third quarter, with 20,962 cars sold during this period. Mustang Mach-E sales increased by 42.5%, totaling 14,824 units. Unfortunately, sales of the F-150 Lightning have plummeted. Ford recently reduced production of its electric truck but cited other issues as the reason behind this decision.

«Ford is able to balance production of gas, hybrid, and electric vehicles to match the speed of EV adoption in a way that others can't. That's obviously good for customers, who get the products they want — and good for us, too, because disciplined capital allocation and not chasing scale at all costs maximizes profitability and cash flow,» said CFO John Lawler.

It's been a difficult time for Ford, which has struggled to match Tesla's drastic price cuts recently. To stay competitive, the automaker reduced pricing for the Mustang Mach-E and increased production. These reductions in MSRP were not enough to sway the buying public, with the company noting, «Many North American customers interested in buying EVs are unwilling to pay premiums for them over gas or hybrid vehicles.»

Ford isn't the only manufacturer struggling to sell new electric vehicles.

However, Lawler is convinced this doesn't mean the electric vehicle segment is stagnating. «The narrative has taken over that EVs aren't growing; they're growing. It's just growing at a slower pace than the industry and, quite frankly, we expected,» said Lawler in the earnings call, reports Automotive News.

While there will be investment delays, the automaker has clarified that it will not cancel its line of second-generation electric vehicles,