F: Ford’s EV Investment Burdened its 2022 Finances, Fleet Profits Soften the Blow
- Development of Ford’s EV business is costing the company billions each year.
- Ford’s 2022 EV losses were made up for with $10bn profits in its fleet and internal combustion businesses.
- It’s EV business has grown quickly, and became the 2nd-highest EV seller in the US last year.
When one thinks of electric vehicles, they often think of Tesla (despite Chinese automaker BYD now commanding almost double the share of the global EV market that Tesla does). How could it not be Tesla? With its futuristic-looking cars, humanoid robot launch events, and larger-than life CEO. For some time now, Ford has been trying to change that – at great cost. Let’s check in with how they’re doing.
A hefty investment
Ford has reported that over the course of 2022, the company lost $2.1bn in the operations of the EV portion of its business. What’s more is that the automaker is predicting 2023 to follow the same trend, with an even greater forecasted loss on its EV unit of around $3bn. The good news for Ford however, is that last year’s loss was more than negated by the success of the company’s fleet and internal combustion businesses which generated $10bn in profit over the same period. Ford’s also sticking to its goal of being able to produce 2m electric vehicles per year by the end of 2026.
The electric effect
Ford is ready to go toe-to-toe with big names in the EV industry, and is so confident that they’re going to begin reporting their financials by business unit as opposed to region. This will allow for detailed insight into the funding behind its EV unit specifically. It could take a while however before the unit turns profitable, as analysts predict that Ford currently loses $9k on every EV it sells. Last year, Ford became the 2nd-highest seller of electric vehicles in the US after Tesla, but its eyes are set on the number one spot.