Ford CEO Jim Farley predicted that electric vehicle (EV) adoption will be slower than expected, at least in the near term. Ford recently released its second-quarter results, revealing a substantial loss in its electric vehicle division.
While the veteran automaker reported revenue of $45 billion, which represents a 12% increase year-over-year, Ford also shared that it had lost $1.1 billion before interest and taxes on its electric vehicle business during the second quarter. The figure is over twice as much as the previous year’s losses.
As noted in a report from The New York Times, Ford is now expecting to lose $4.5 billion before interest and taxes on its electric vehicles this 2023. Previous forecasts estimated losses to be at around $3 billion. Ford Chief Financial Officer (CFO) John Lawler shared a comment about the trend in a conference call.
“While the shift to EVs is unquestionably underway, the last few weeks have shown us the adoption by early, majority customers will be a little slower than expected,” Lawler said. He also noted that Ford was slowing its rollout of electric vehicles to some degree, with the company now expecting to make 600,000 EVs a year by the end of 2024. Previously, Ford aimed to reach such levels by the end of this year.
Despite the larger losses, Ford’s electric vehicle business is still growing. As noted by the company in a press release, revenue from Ford Model e’s first-generation electric cars rose 39% in the second quarter. Ford CEO Jim Farley remained optimistic about the matter.
“The near-term pace of EV adoption will be a little slower than expected, which is going to benefit early movers like Ford. EV customers are brand loyal, and we’re winning lots of them with our high-volume, first-generation products; we’re making smart investments in capabilities and capacity around the world; and, while others are trying to catch up, we have clean-sheet, next-generation products in advanced development that will blow people away,” Farley said.