Ford Motor Co. (NYSE: F) was supposed to be the American car company leader in the electric vehicle (EV) sector. Its lead horse would be the F-150 Lightning, the electric-powered version of the best-selling vehicle in the United States for the past four decades. It hasn’t worked that way at all. Ford will cut the planned production of the Lightning in one large plant by half for next year. That is a huge retreat.
What’s the Problem With Ford EVs?
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Ford will be lucky to sell 25,000 Lightings this year. The forecasts for production in 2023 were many times that. The company pushed that forecast until next year. Ford management has to ask itself if it will have any year soon when Lightning sales will hit expectations.
It is hard to underestimate the blow to Ford. The company recently delayed its planned EV investment of $12 billion. Ford’s EV unit has lost $3.1 billion through the year’s first three quarters. Also, Ford has been financially pinched between the EV debacle and a new, highly expensive UAW contract. That means product development costs are under pressure.
Ford has struggled with the Lightning for well over a year. Ford raised the price of the Lighting four times. Then, in the middle of the year, it cut them. According to The Detroit Free Press, when it announced the reduction, Ford said, “Ford is taking advantage of increased plant capacity, continued work on scaling production and cost, and improving battery raw material costs.”
Ford has found that buyers want hybrids, which have small gas engines and electric ones. Such hybrids have been part of the American vehicle landscape for over a year.
Ford is also up against an American car-buying public skeptical about EVs. Do they have ranges long enough for multi-hour trips? Are there enough charging stations? How long does it take to charge an EV?
If EVs were supposed to be that bright future of Ford, what happens now?
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