Ford Losses Continue to Mount with Billions Expected in 2025
Ford losses in the electric vehicle sector are set to worsen in 2025, with the company projecting financial setbacks of up to $5.5 billion. In 2024, Ford already recorded a $5.1 billion deficit linked to its clean energy vehicle operations. The persistent financial strain stems from the high production costs of electric vehicles, primarily due to expensive battery technology. Despite Tesla's struggles to achieve profitability until 2020, General Motors recently reported that it has begun turning a profit on EVs. Meanwhile, Ford's Model E division, responsible for its zero-emission lineup, has faced consecutive losses and is preparing for yet another challenging year.
Ford Losses in the EV Market
Ford's financial report for 2024 revealed an annual loss of $5.1 billion in earnings before interest and taxes. Looking ahead, the Dearborn, Michigan-based automaker expects its Ford losses to climb even higher in 2025, ranging between $5 billion and $5.5 billion. Despite the bleak outlook, the company remains optimistic, pointing to its continued investments in electric vehicle development. Ford also reported $1.4 billion in cost reductions last year within its Model E division, a step toward improving financial efficiency.
Although Ford losses in the EV segment remain substantial, the company's electric vehicle sales grew by 34.8% in the U.S. last year, with 97,865 new units sold. Meanwhile, hybrid models saw a 40.1% increase, reaching 187,426 units. However, gasoline-powered vehicles still accounted for the bulk of Ford's total sales, with 1,793,541 units sold, reflecting a modest 0.2% increase over 2023.
Electric Trucks Face Major Challenges
For the 47th consecutive year, the Ford F-Series remained the best-selling truck in the U.S. However, company executives acknowledged that the F-150 Lightning, Ford's flagship electric truck, faces considerable obstacles. During the 2024 fiscal conference call, CEO Jim Farley admitted that electric trucks struggle with towing due to their large and heavy battery packs. He also noted that EVs have worse aerodynamics and weigh significantly more than their gasoline counterparts, requiring even larger and costlier batteries to achieve competitive range figures.
With these challenges in mind, Ford has chosen to delay its next-generation electric midsize pickup truck by 18 months, pushing its expected launch to late 2027.
Future EV Strategy and Cancellations
In February 2024, Farley revealed that Ford had formed a 'skunkworks team' to develop a low-cost EV platform aimed at competing with Tesla and affordable Chinese electric vehicles. Additionally, Ford engineers are working on extended-range electric vehicles (EREVs) that use a small gas engine as a generator to charge the battery. Similar to the Mazda MX-30 R-EV, these models won't rely on the internal combustion engine for direct propulsion. Instead, electric motors will power the wheels, offering a hybrid-like range extension without traditional mechanical connections.
Meanwhile, Ford losses continued to pile up as the company abandoned its three-row electric SUV project for 2024, citing financial infeasibility. This decision cost the automaker a staggering $1.9 billion. Initially planned for release in 2024, then pushed back to 2027, the large SUV was ultimately canceled due to unfavorable market conditions.
While Ford has discontinued some projects, it still offers large electric SUVs in Europe, such as the Explorer EV, though this model is distinct from the gasoline-powered Explorer sold globally. The Explorer EV is essentially a rebadged Volkswagen ID.4, while the new Ford Capri shares its platform with the Volkswagen ID.5.
Looking ahead, Ford plans to utilize multi-energy vehicle platforms capable of supporting both combustion engines and electric drivetrains. This strategy will allow the automaker to reduce Ford losses while adapting to evolving market trends and consumer demands.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Arabiya
18 hours ago
- Al Arabiya
Tesla to build first grid-scale power plant in China
Tesla announced Friday that it signed an agreement to build its first grid-scale energy storage power station project in mainland China. The project will help with the flexible adjustment of grid resources, and 'effectively solve pressures relating to urban power supply,' Tesla said in a post to the Chinese social media platform Weibo. 'After completion, this project is expected to become the largest grid-side energy storage project in China,' Tesla added. Such energy storage systems help to enhance stability in the electricity grid at a time when there are greater supplies of solar and wind power. Chinese media outlet Yicai reported that Tesla Shanghai, Shanghai authorities and China Kangfu International Leasing Co. held a signing ceremony Friday for the project. It added that the deal involved investments of 4 billion yuan ($560 million). The contract comes at a moment of tension between Washington and Beijing, with the two sides yet to hash out a long-term trade agreement following tariffs announced by President Donald Trump. China and the United States negotiated a 'framework' agreement in London earlier this month following two days of marathon talks.
Al Arabiya
a day ago
- Al Arabiya
As Musk's 'robotaxi' rollout approaches, Democratic lawmakers in Texas try to throw up a roadblock
A group of Democratic lawmakers in Texas is asking Elon Musk to delay the planned rollout of driverless robotaxis in the state this weekend to assure that the vehicles are safe. In a letter, seven state legislators asked Tesla to wait until September when a new law takes effect that will require several checks before autonomous vehicles can be deployed without a human in the driver's seat. Tesla is slated to begin testing a dozen of what it calls robotaxis for paying customers on Sunday in a limited area of Austin, Texas. 'We are formally requesting that Tesla delay autonomous robotaxi operations until the new law takes effect on September 1, 2025,' the letter from Wednesday, June 18, reads. 'We believe this is in the best interest of both public safety and building public trust in Tesla's operations.' It's not clear if the letter will have much impact. Republicans have been a dominant majority in the Texas Legislature for more than 20 years. State lawmakers and Republican Gov. Greg Abbott have generally embraced Musk and the jobs and investment he has brought to Texas from his SpaceX rocket program on the coast to his Tesla factory in Austin. The company, which is headquartered in Austin, did not respond immediately to a request for comment from The Associated Press. The law will require companies to secure approval from the state motor vehicles department to operate autonomous cars with passengers. That approval, in turn, would depend on sufficient proof that the cars won't pose a high risk to others if the self-driving system breaks down, among other reassurances. Companies would also have to file detailed plans for how first responders should handle the cars if there is a problem, such as an accident. The letter asked Tesla to assure the legislators it has met all the requirements of the law even if it decides to go ahead with the test run this weekend. The letter was earlier reported by Reuters. Musk has made the robotaxi program a priority at Tesla, and a failure would likely be highly damaging to the company's stock, which has already tumbled 20 percent this year. Musk's political views and his affiliation with the Trump administration have drastically reduced sales of Tesla, particularly in Europe, where Musk's endorsement of Germany's far-right Alternative for Germany party in February's election drew broad condemnation. Tesla shares bottomed out in March and have rebounded somewhat in recent months. Much of the rise reflects optimism that robotaxis will not only be deployed without a hitch but that the service will quickly expand to other cities and eventually dominate the self-driving cab business. Rival Waymo is already picking up passengers in Austin and several other cities and recently boasted of surpassing 10 million paid rides. In afternoon trading Friday, Tesla shares were largely unchanged at 320.
Saudi Gazette
2 days ago
- Saudi Gazette
Chinese citizens flee Iran as conflict with Israel rages on
TEHRAN — Hundreds of Chinese workers, students and tourists have fled or been evacuated from Iran to neighboring countries as the conflict with Israel spirals. Masa Li, a 24-year-old Chinese citizen who has lived and worked in Tehran for the past few years, fled the city on Monday after three days of bombing. 'At night, we took turns keeping watch. There were explosions every night, lasting until two or three o'clock in the morning,' she said, adding that she saw several strikes hitting the city from where she lived. On the final day, Li decided to flee with nine colleagues and friends. It took them more than 30 hours to reach a border crossing in Armenia — a drive stalled by repeated car breakdowns and frequent stops for questioning and phone checks by police and military officers. 'I didn't expect this to really happen,' Li told CNN from the Armenian capital of Yerevan. 'There were two minor flare-ups last year, but I didn't expect things to escalate so quickly this time.' Many Chinese in Iran work for Chinese companies that have invested in the oil-rich country. China has for years been Iran's largest trading partner and the biggest buyer of Iranian oil. The Middle Eastern nation is an enthusiastic supporter of Beijing's 'Belt and Road Initiative,' a global infrastructure and investment drive. The Chinese Embassy started evacuating Chinese citizens from Tehran on Tuesday, according to state media. China's Foreign Ministry said Thursday that more than 1,600 Chinese nationals had been relocated from Iran, while several hundred Chinese citizens had been evacuated from Israel. China, a key diplomatic and economic backer of Iran, has condemned Israel for violating Iran's sovereignty and escalating tensions in the Middle East by launching the attack. It has urged both sides to de-escalate tensions and offered to play a 'constructive role' in resolving the conflict. — CNN
