Wednesday, May 31, 2023

Ford advocates electric cars despite having a loss of 3,000 million

Conviction, certainty or confidence in an idea, concept or project can be more than money. This is demonstrated by Ford, which by 2023 expects a negative balance of 3000 million dollars in its electric vehicles, but will still continue in this segment, according to the Wall Street Journal and confirmed by our colleagues from Business Insider.

But this data is aggravated if we compare it with those of 2022, where it lost approximately 2,100 million dollars, which reduced the global operating profit of Ford to 100,400 million dollars. But, as we said, the task of electrification is firm, which in 2021 announced the largest expenditures in its entire history, 11.2 billion dollars for electric vehicles.

Ford’s chief financial officer, John Lawler, blames this financial hole in Ford’s investment for increasing EV production in recent years. This includes the construction of two new battery cell factories in Kentucky and a third in Tennessee, along with a new plant to manufacture 100% electric vehicles.

The American company has constructed a new financial information structure to give a better understanding of the results of its 3 business units: its electric vehicle business; Ford Blue, a supplier of parts of the company that sells internal combustion engine vehicles; and Ford Pro, its commercial vehicle division.

Faced with this economic imbalance, Ford is going to reduce fleet units and look for new partnerships like the one it did with the Volkswagen Group to manufacture the new Ford Explorer. A 100% electric SUV based on the MEB platform of the German company.

The financial director of the American brand is convinced that the model of business growth, losses will gradually stop and the operating profit will reach a margin of 8% by the end of 2026, close to the target of 10% set for the company. . Last year, Ford’s operating profit was 6.6%.

If we stick to the production figures handled by the Detroit firm, we see that it expects to reach 600,000 units by the end of this year and exceed two million vehicles by 2026. It will also be a difficult time for the rest. brands offer electric products with lower costs than Ford.


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Nation World News Desk
Nation World News Desk
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