Ford delays electric vehicle goal, raises concerns about increased losses

Ford Motor announced on Thursday that it has revised its production targets for electric vehicles (EVs) due to slower-than-expected adoption. Instead of reaching a production rate of 600,000 EVs per year by the end of 2023, Ford now expects to achieve this milestone sometime in 2024. Additionally, the automaker no longer has a set timeline for reaching a rate of over 2 million EVs per year by the end of 2026.

Despite the adjusted projections, Ford’s Chief Financial Officer (CFO) John Lawler reassured stakeholders that the company’s EV spending plan and profitability goal for its EV business remain unchanged. Ford still aims for an 8% operating margin in its EV segment and has no plans to reduce its capital spending on EVs.

CFO John Lawler stated, “We’re committed to achieving that 8%, and we’re confident in our ability to do so.” He acknowledged that the transition to EVs may take longer than originally anticipated but emphasized that Ford is dedicated to navigating the evolving landscape of the industry.

CEO Jim Farley expressed optimism regarding the revised production timeline, suggesting that the slower pace of EV adoption could work in Ford’s favor. He highlighted the success of Ford’s first-generation F-150 Lightning and Mustang Mach-E EVs and stated, “While others are playing catch-up, we have revolutionary, next-generation products in advanced development that will exceed expectations.”

Although Ford reported overall profitability in the second quarter, its Model e unit incurred an operating loss of $1.8 billion.