Ford Motors Loses Billions on Electric Vehicles

Ford says EV unit losing billions, should be seen as startup

Ford Motor Co.’s electric vehicle business has lost $3 billion before taxes during the past two years and will lose a similar amount this year as the company invests heavily in the new technology.

The figures were released Thursday as Ford rolled out a new way of reporting financial results. The new business structure separates electric vehicles, the profitable internal combustion and commercial vehicle operations into three operating units.

Company officials said the electric vehicle unit, called “Ford Model e,” will be profitable before taxes by late 2026 with an 8% pretax profit margin. But they wouldn’t say exactly when it’s expected to start making money.

Chief Financial Officer John Lawler said Model e should be viewed as a startup company within Ford.

“As everyone knows, EV startups lose money while they invest in capability, develop knowledge, build (sales) volume and gain (market) share,” he said.

Model e, he said, is working on second- and even third-generation electric vehicles. It currently offers three EVs for sale in the U.S.: the Mustang Mach E SUV, the F-150 Lightning pickup and an electric Transit commercial van.

Why is everyone trying to reinvent the wheel?

Tesla lost money it’s first 8 or 9 Years and billions of dollar!

Tesla is so far ahead of the game, it's not even funny.  It's the only profitable EV company.   CEO Farley of Ford recently stated that Tesla has a $10k cost advantage "on every" vehicle they sell.  Think about that.  No dealer network, no Unions for Tesla....Tesla has a big cost advantage.   

Ford, Chevy, et al have so many legacy costs that will make it difficult for them to scale quickly to compete in the EV space.  The investment community and bean-counters at Ford & Chevy  will determine how successful the legacy automakers can transition to EVs.  And I am skeptical how quickly and successful they will be able to make that transition. 

Investors were/are incredibly patient for Tesla to finally make $$ and be a profitable company, not unlike Amazon.   People will find out that investors don't have the same patience with these legacy automakers like Ford & Chevy to be profitable in their EV businesses.  This will turn out to be a big impediment in their EV ambitions.  The scale up to EV for these companies will take much longer than people think. 

Stick w/ Tesla.