Ford’s Model e electric vehicle segment faced a significant loss of 1.3 billion USD in the first quarter, which translates to 132,000 USD for each car sold. Despite selling 10,000 electric vehicles in the first quarter, a 20% decrease from the previous year, revenue from this segment decreased by 84% to just 100 million USD due to intense competition in the industry.
Ford CEO Jim Farley stated that the price war among electric vehicle manufacturers has made it challenging to achieve profits. Although they reduced costs by $5,000 per Mustang Mach-E, sales continued to decline rapidly. However, Ford is making changes in the electric vehicle segment to potentially achieve profitability with the next generation of cars.
Ford Pro, which handles high-volume sales to business and government customers, has shown substantial demand for electric vehicles. Recent orders for electric vehicles like the E-Transit and F-150 Lightning have shown promise. While Ford mainly focuses on selling gasoline cars and witnessed more than double the pre-tax profit in the last quarter due to an increase in revenue and units sold, Ford Blue, which sells gasoline cars to consumers, experienced a decline in revenue and units sold but recorded a profit of 905 million USD.
Competitors like General Motors and Stellantis have reported positive business results in the electric vehicle segment, indicating varying success across the industry. Tesla reported a decrease in profits and revenue in the first quarter of the year despite being one of the largest electric car companies globally.
In conclusion, while some traditional car manufacturers are transitioning from gasoline cars to electric cars successfully, others face significant challenges achieving profitability with their EV segments. The price war among manufacturers continues to impact profits before taxes for some companies while others witness more than double pre-tax profits with an increase in revenue and units sold.
Furthermore, Ford’s efforts towards changing its EV segment strategy could potentially lead them towards achieving profitability with their next generation of cars while also remaining competitive within their market space.
As such, it is crucial for traditional car manufacturers like Ford to continue innovating their EV technology while keeping an eye on market trends and consumer demands if they wish to remain competitive and profitable long term.
Overall, while there are significant challenges facing traditional car manufacturers like Ford when it comes to transitioning into EV technology fully successfully