February 8, 2024: Ford looks set to continue a freeze on selected investments in its EV business after revealing the unit’s $4.7 billion loss outstripped overall net income of $4.3 billion in 2023, which one industry commentator said equates to nearly $65,000 for each EV it sold.
CFO John Lawler (pictured) said on February 6 that mainstream customer take-up of EVs was happening at a slower rate than the industry expected — and he reiterated last year’s shock announcement that the auto giant had “deferred certain capital investments” in EVs until they’re justified by demand.
However, Lawler insisted EVs are here to stay and said it is developing next-generation EVs that will “surprise customers” and be profitable within a year once launched.
Industry observers have told Batteries International the move will unsettle investors in the lithium battery supply chain — and the slow-down in sales of EVs will likely lead analysts to revise forecasts for the fortunes of the lead battery sector.
Meanwhile industry commentator Robert Bryce — who said last November that Ford was facing up to the “truth bomb” that motorists don’t want to pay a premium for EVs — said on February 7 the firm’s losses are only part of a train wreck in the EV market.
“Perhaps the most remarkable thing about the staggering losses at Ford and the other automakers is that the carmakers didn’t understand the limited appeal of EVs,” Bryce said.
According to him, who hosts the Power Hungry Podcast, EVs are a niche market, primarily defined by class and ideology, with some 57% of EV owners in the US earning more than $100,000 annually, 75% are male and 87% are white.
Last October, Tesla CEO Elon Musk said he was concerned about the impact of high interest rates on car buyers and said the firm was hesitating on its plans for a factory in Mexico as it assesses the economic outlook.
You know the EV business is in trouble when Musk makes such comments, Bryce said.