Ford Says Americans Are ‘Unwilling’ To Pay More For EVs Than Gas And Hybrid Vehicles
EVs are a tight squeeze … on pricing.
Ford’s division dedicated to electric vehicles, Model e, reported a $1.3 billion loss during the third quarter due to in part to a slow production ramp amid big investments in future products.
Ford explained in a note that “many North America customers interested in buying EVs are unwilling to pay premiums for them over gas or hybrid vehicles, sharply compressing EV prices and profitability.”
Despite the EV investments, the automaker hasn’t committed toward going all-electric and is pursuing a long-term multi-energy strategy that includes internal combustion engine and hybrid models.
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“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,†said CFO John Lawler.
“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.â€
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Ford delivered 46,671 all-electric vehicles from January through September and 96,514 hybrids out of 1.5 million vehicles total.
CEO Jim Farley said on an earnings call that the company was putting a new focus on trimming costs for its upcoming electric vehicle production.
Ford also announced a new version of the F-150 Lightning called the Flash coming in 2024 that addresses the EV pricing issue by bundling a number of popular features from across the lineup at a lower price, albeit one that still starts at $69,995.
General Motors was similarly cautious about the speed of EV adoption during its earnings call earlier this week and recently announced it was delaying the planned opening of a second electric truck factory by nearly a year until late 2025.
Unlike Ford, GM has all but abandoned hybrid vehicle development, but has continued investments in V8s and other pure ICE powertrains.
This story has been updated with additional information
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