Ford Takes Billion-Dollar Hit After Failed EV Push

(RepublicanNews.org) – American motor giant Ford has announced delays to the planned production of electric vehicles (EV), opting instead to focus on hybrid engine models after experiencing painful losses in the first quarter of 2024. Ford’s EV section, known as Blue Oval, posted a loss of $1.3 billion for the January – March period of this year, twice the losses incurred in the first quarter of 2023. While the EV arm of Ford took approximately $100 million of revenue, its outlay for each car was too high to be able to turn a profit, with the company reporting a $130,000 loss for each EV sold.

Ford officials blamed the company’s economic misfortune on market conditions, with increasing competition in the electric and hybrid vehicle sector. Some business experts have also pointed to a lack of demand for such vehicles, despite a push from the White House to pivot the country away from traditional internal combustion engines. President Biden signed an executive order in 2021 in which he agreed to a target of half of new vehicles to be so-called “zero emission” types by 2030, although the order is nonbinding.

Ford is not alone in its EV-related difficulties, with rival Tesla’s adjusted revenue dropping by almost half in the first quarter of this year. Some automakers, however, have found a little more success, with General Motors reporting that it is on track to make some profit in its EV section in the second half of the year.

While Ford currently estimates that it will lose a total of $5 billion from its electric division by the end of the year, top figures in the business have tried to maintain a positive angle. CEO Jim Farley told investors that Ford would be making significant changes to its EV division and that he still believed that the next generation of Ford EVs would prove to be profitable, with the company aiming to have each EV sale able to cover the costs of its manufacture and turn a profit, instead of the sale price effectively being used up in covering the costs of research and development.