Ford to Increase Hybrid Focus Following $1.1B EV Losses
Following slower EV adoption than expected, Ford CEO Jim Farley says you can expect the American automaker to increases its focus on partially electrified vehicles. “You’re going to see a lot more hybrids systems from us,” he said after the company’s second-quarter earnings revealed the company had lost nearly $1.1 billion on EVs.
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The company is still doing well overall. Its gasoline-powered business, dubbed Ford Blue, earned $2.3 billion through the quarter with a profit margin of 15%. Its commercial business, Ford Pro, earned $2.4 billion with a profit margin of 9.2%. You can thank the F-Series truck for that. However, Ford expects it will lose a total of $4.5 billion on EV business this year, up from $3 billion in losses from the previous year.
Losing money on emerging technologies is no surprise. Tesla was in business for over a decade before it began turning a profit. In recent years, Ford began investing heavily in electric technology in anticipation of future EV adoption, but that adoption was always going to be slow. Still, it’s even slower than expected, and like Toyota, Ford is beginning to think that for now, the best move may be to put extra focus on hybrid models.
Ford currently offers a limited number of hybrids, including optional electrified powertrains for the F-150, Maverick, and Escape. According to Farley, more than 10% of F-150 pickup customers are choosing to go for the hybrid model, and that percentage is rising. “We have been surprised, frankly, at the popularity of hybrid systems for F-150,” he said, adding that over half of Maverick buyers are spending the extra $1,500 for the small pickup’s optional hybrid powertrain.
There’s no indication yet as to how Ford will ramp up its hybrid offerings, but Farley also added that the goal of adding hybrid systems is not necessarily to make the cars more efficient. It can also be to add performance or an onboard generator system. “We’re seeing a lot of customers like that combination of using the batteries for something beyond just moving the vehicle,” Farley said. “And so we’re just listening to the market.”
Kurt Verlin was born in France and lives in the United States. Throughout his life he was always told French was the language of romance, but it was English he fell in love with. He likes cats, music, cars, 30 Rock, Formula 1, and pretending to be a race car driver in simulators; but most of all, he just likes to write about it all. See more articles by Kurt.