Eric Starkman’s Post

Ford Motor Company is cancelling plans for a large electric sport-utility vehicle and expects to take $1.9 billion in related special charges and write-downs as automakers continue adjusting their EV plans because of softer-than-expected demand. The automaker said it would delay plans for an electric three-row SUV by two years to a 2027 release date. On Wednesday, the company said it is scrapping the model altogether, citing tough pricing pressure as automakers resort to aggressive discounts to move their EVs. Ford instead will offer a hybrid gas-electric version of a future large, three-row SUV, a popular vehicle category that includes the brand’s Explorer and Expedition nameplates. The company also pushed back the launch of a new electric pickup truck by one year, until 2027. In addition, Ford said it would trim its capital spending on fully electric vehicles to about 30% of its budget, from 40%. “Based on where the market is and where the customer is, we will pivot and adjust and make those tough decisions,” Ford Chief Financial Officer John Lawler said. #ford #electricvehicles #automotive #sustainability #marketadjustments #hybridvehicles #suv #evplans #automotiveindustry #fordmotorcompany #capitalspending #pricingpressure #electricpickup

Automakers are warning of profit pressures in their traditional car businesses, a fresh worry that adds to the challenges already posed by the industry’s costly transition to electric vehicles. Ford Motor, Tesla and Jeep-maker Stellantis last week saw their share prices hammered after posting results that fell short of Wall Street’s expectations. General Motors beat estimates and raised its full-year profit outlook, but its shares also sank. Reasons for the pressure on profits ranged from warranty expenses and bloated vehicle inventory to trouble in overseas operations. Taken together, they signaled to investors that carmakers—while pushing toward a transformation to tech-infused electric vehicles—are facing speed bumps. One particular concern among auto investors has grown louder: The strong pricing power that carmakers have enjoyed in the pandemic era is slowly fading. Several auto executives warned that in the second half of the year, they expect the average price paid by customers will edge lower. “The results of our competitors are not demonstrating that price pressure is going to vanish,” said Carlos Tavares, chief executive of Stellantis, which also makes Ram vehicles. Car companies for years have made the case that they are ready to become technology companies, with plans to transform cars into battery-powered smartphones on wheels. Wall Street’s enthusiasm for that vision has faded, as U.S. electric-vehicle demand hasn’t taken off as expected. With signs that pricing is losing steam as the American car buyer grapples with high interest rates, investors are looking for reasons to stick around. “The overarching feeling for the auto industry is that the good times can’t last,” said Martin French, managing director at auto consulting firm Berylls Strategy Advisors. Automakers have touted bold makeovers before, only to see their visions fade and return to their industrial, low-margin roots. Many automakers invested heavily in driverless cars and vehicle-sharing ventures in the mid-2010s, for example, only to unwind those projects after they hit technical hurdles or the business case didn’t materialize. Traditional automakers say they aren’t abandoning their push into electrics, although some continue to curtail investments in new factories and EV models. Those massive investments are pressuring legacy carmakers to wring every penny from their traditional combustion-engine businesses. The record sums American shoppers have been paying in recent years have helped, driven by pandemic-related vehicle shortages that created a seller’s market. Analysts say that if pricing reverses too much, it will eat into the profits the automakers are counting on to help fund that EV transition. Last week GM said it expects to spend more on discounts to keep buyers interested, a move that will likely ding its bottom line by about $1 billion in the second half of the year.

Another heavy, inefficient EV biting the dust. Losing $5B is a serious hit and with VW's announcement to close three plants in Germany, we're starting to see the Automakers get in real trouble over their EV investments. One day soon enough people will see the logic behind the Aptera and the market will swing in our direction. https://lnkd.in/g5yw2-RD Ford Motor Co. plans to shut down the Michigan factory that produces its F-150 Lightning plug-in pickup truck, its signature electric vehicle, through the end of the year as demand for EVs continues to wane. Farley spoke of the “slow uptake of EVs” during Ford’s third-quarter earnings call with analysts Oct. 28 and predicted Ford would lose US$5 billion this year on its battery-powered models.

They can’t even give their EVs away: Ford Credit is offering 0% financing for 72 months to qualified buyers, plus a $7,500 cash incentive on leased vehicles. Marketing teams and Governments seem to have forgotten you have to create products that people actually want. Consumers can be very harsh when they vote with their pocket or the ballot box. Yes consumers care about the environment but no they are not going to be taxed or greenwashed or harshly bulldozed into buying an inferior product that does not have the life of an ICE engine. Porsche get it, the future is synthetic fuels, carbon offsetting and then electric vehicles for short city trips, but no we don’t want to be bulldozed into a major purchase of an inferior product, Diesel is still the highest density fuel… and it’s vegan and recyclable. EVs work in cities but definately not out of the city and at -20 where you need the ground clearance of a Toyota Hilux or Ford F150. So now if you buy an EV car you are subsidised by the Tax payer, Ford the company and its shareholders and the consumers of ICE Ford vehicles and city regulations and consumers still don’t want them. The definition of insanity is repeating the same thing and expecting a different result. Maybe it’s time to go back to the drawing board? #electricvehicles

I've observed similar trends across the broader automotive industry, with fully electric vehicles collecting dust at dealerships nationwide. I believe this trend will persist not just with Ford, but across other manufacturers as well. However, I am confident that plug-in hybrids and gas engines will continue to gain significant momentum in the market. Ford has announced significant cuts to its electric vehicle (EV) rollout plans, including the cancellation of a large electric SUV and a reassessment of its overall strategy, driven by disappointing demand. The company expects to incur $1.9 billion in special charges and write-downs related to this shift. Due to tough pricing pressures and the need for aggressive discounts to sell EVs, Ford will replace its canceled electric SUV with a hybrid gas-electric version, catering to the popular three-row SUV market, which includes models like the Explorer and Expedition. The launch of a new electric pickup truck has also been delayed by a year, now set for 2027. Moreover, Ford has reduced its capital spending on fully electric vehicles from 40% to about 30% of its budget. #Ford #ElectricVehicles #EV #HybridCars #AutomotiveIndustry #SustainableMobility #PlugInHybrid #GasPowered #CarTrends #SUV #FutureOfTransportation #AutoNews #GreenTechnology https://lnkd.in/gJ-7KxAJ

Ford Motor Company, like many legacy ICE vehicle manufacturers, is stuck between a rock and a hard place. The fastest-growing vehicle segment in the United States is electric vehicles (EVs), which held a 7.6% share of the total vehicle market in 2023, up from 5.9% in 2022. The US EV market is expected to grow by 25.4% CAGR from 2024–2028, reaching a market value of $137.43 billion in 2028. So why is Ford pulling back on their EV strategy? Because, as their CFO confessed, they still haven't figured out to make profitable EVs... Here's the challenge facing US Big Automakers: it's very difficult to make profitable EVs without having major control over the EV supply chain. Ford is dependent upon (and at the mercy of) third party suppliers for major components like batteries, control units, etc. Another issue is that the American Big 3 (Ford, GM, Stellantis) and their dealers enjoyed very healthy profits during Covid when they were selling high margin trucks and other high trim vehicles and it's painful to go back to producing lower trim cars / trucks with less profit, be it ICE OR EV. Finally, Chinese OEMs enjoy a healthy head start and are able to produce cheaper, more profitable EVs thanks to economies of scale, fat government subsidies, less stringent vehicle safety requirements and a domestic market that is all in on EVs. Of course nothing is stopping the US government from handing a pile of cash to legacy US Automakers, but unless conditions are attached, requiring said funds be used to support EV R&D and manufacturing, the money would likely be spent on stock buybacks and other non EV stuff. Do you think Ford's new strategy is wise and will lead to success, profit amd growth, or will they continue to lose market share as North America and world transitions from EV to ICE? Keep climbing! 💪📈 https://lnkd.in/g4YVJXrc #electrification #evs #electricvehicles #Ford #Automakers #salesmountaineer

I remember when Ford Motor Company axed its small cars in 2018, something JPMorgan called "the sort of bold and decisive action we believe investors have been waiting for" to juice short-term returns. I wondered when this move—essentially becoming a truck company and ceding the small-car market to the Asian automakers—would come back to haunt them. I always thought it would be a huge spike in gas prices, but now, it's something arguably worse. Now, Ford and the American automakers have learned to run on profit margins from huge trucks and SUVs, and they have to fight China's automakers by doing something they've never been truly great at: making affordable, profitable small cars. And this time, they have to run on batteries as well. This isn't even meant as a dig at Ford's current administration, which I think is making better moves than they get credit for. But it shows the massive challenge ahead for the U.S. auto industry as a whole:

Electric Vehicles have been a hot topic in the automotive community for a while, however the market is being flooded with them in recent years. Ford released the Mustang Mach-E in December of 2020 as Ford’s new electric mustang SUV. The Mach-E was Ford’s attempt to enter the electric car scene. However, Ford ran into a few issues with this new car. A few of the issues include, overheating battery resulting in a no start situation, rusting motors which are prone to fail, and the battery even not charging overnight. On another case of Ford electric vehicles, the Ford F150 Lightening has had a better start. Some common issues include bad battery range when towing and inoperative lights. Customers have been happy with their F150 Lightnings as some trucks reportedly went 30,000+ miles in their first year. Ford has done better with the Lightening than the Mach E. Ford Motor Company has made slow improvements with their electric vehicles. They are making adjustments and recalls as they perfect the reliability and other systems in their cars and trucks. Other car brands are also experiencing similar issues with battery life and questionable longevity of the vehicles. Though electric cars and trucks are becoming more common on the roads and more available at car dealerships, questions are still lingering in thousands of automotive enthusiasts heads’. How sustainable and reliable are electric cars? Will they improve? What is the future of gasoline and diesel vehicles? #Ford #F150Lightning #MachE Tucker, Sean. “Ford Cancels Many F-150 Lightning Orders for Quality Pause - Kelley Blue Book.” Kelly Blue Book, 3 Oct. 2023, https://lnkd.in/gK6QEVmG. Brown, Laura Sky. “Thousands of Ford Mustang Mach-e Evs Could Be Re-Recalled over Battery.” Car and Driver, 21 Aug. 2023, https://lnkd.in/gzd9_QdY.

Ford Motor Company experienced a significant sales boost in May driven by a surge in sales of their hybrid vehicles and trucks. Notably, one of their truck models saw an impressive 96% increase in sales during the month. For more insights on Ford's sales growth, check out the details. #Hybrids #Trucks #SalesGrowth #Motorlease #WhateverItTakes

USA Automotive - Ford Hits the Brakes on F-150 Lightning Production Ford Motor Company will pause production of its F-150 Lightning electric pickup trucks for six weeks from Nov. 18 to Jan. 6. The decision is part of an adjustment for better sales growth and profitability. The company has scaled back its EV plans, canceling a three-row electric SUV and delaying a new electric F-150. Despite a 45% increase in U.S. EV sales and a doubling of F-150 Lightning sales to 7,100 units, they still represent only 3.6% of F-Series sales. In April, Ford cut production to one shift to reduce costs amid expectations of a $5 billion loss on EVs this year. The third-quarter net income was $900 million, affected by a $1 billion charge from its canceled SUV. #ev #truck #carmanufactrer #automotive #usa #ElectricSUV #carproduction #F150 https://lnkd.in/edGuQHPr