During the first quarter of 2024, Ford encountered substantial challenges within its electric vehicle (EV) department, resulting in a significant financial setback. With a staggering loss of $1.3 billion, or approximately $132,000 per vehicle sold, the company faced formidable hurdles in maintaining profitability in its EV segment. This notable deficit was attributed to various factors, notably the decision to slash prices of its electric models in an effort to remain competitive in the evolving automotive landscape. Moreover, substantial funds were earmarked for ongoing research and development initiatives aimed at advancing Ford’s presence in the rapidly growing electric vehicle market.
Despite generating $100 million in revenue from electric vehicle sales, representing a notable decline of 84% compared to the previous year, Ford’s financial performance in this sector fell short of expectations. The company’s outlook for the remainder of the year remained challenging, with projections indicating a total loss of $5 billion in its electric vehicle division. This forecast followed a difficult financial year prior, where Ford incurred a loss of $4.7 billion in its electric division, equating to approximately $40,525 per vehicle sold.
In contrast to the struggles faced by Ford’s electric vehicle segment, its Ford Pro department, primarily focused on internal combustion models, reported a substantial profit of $3 billion. Additionally, the Ford Blue department recorded a revenue of $21 billion, albeit experiencing a 13% decline. Despite these mixed results, Ford’s overall profit for the period amounted to $1.3 billion, marking a 20% decrease compared to the previous year.
While Ford grappled with challenges in its electric vehicle division, the broader market for plug-in vehicles in the United States showcased promising growth trends. During the first quarter, consumers purchased a total of 352,390 plug-in vehicles, underscoring the increasing popularity of electric vehicles among consumers. Ford’s contribution to this figure amounted to 10,000 car sales, highlighting its presence in the evolving electric vehicle market.
Meanwhile, Toyota emerged as a dominant force in the market, capturing 50% of EV sales in March alone. The Japanese automaker’s impressive performance reflected a growing consumer appetite for electric vehicles, with EV models accounting for 36.6% of Toyota’s total sales for the first quarter. This notable surge represented a remarkable 74% increase compared to previous periods, reaffirming the growing significance of electric vehicles in the automotive industry.