Ford Motor Co. is postponing about $12 billion in planned spending on new electric vehicle manufacturing capacity in North America. The move comes as the automaker noted on Thursday that customers are generally no longer willing to pay a premium for electric cars.
Ford’s electric vehicle sales are growing, and so are the sales of other automakers that are competing in the EV sector. The pace of the company’s EV sales, however, does not appear to be growing at the rate that Ford has projected.
In Ford’s Q3 2023 earnings report, the company stated that its Model e electric vehicle unit lost $1.3 billion on an operating basis in Q3, which was double its year-ago loss. The EV unit also lost $3.1 billion through the first three quarters of this year, which was roughly in line with the company’s $4.5 billion full-year operating loss estimate.
Despite these circumstances, Ford executives have maintained that they are not cutting back on spending on future EV models. If any, the recent results and the EV market’s current state would result in Ford moving through its electric vehicle plans in a more gradual manner. Ford CFO John Lawler described the company’s plans in a media briefing on Thursday.
“We’re not moving away from our second-generation EV products. We are, though, looking at the pace of capacity that we’re putting in place. We are going to push out some of that investment,” he said.
Part of the company’s revamped electric vehicle strategy is the postponement of about $12 billion in planned spending on EV manufacturing capacity. These include a tentative second battery plant at a new campus in Kentucky. The executive, however, also noted that the construction of Blue Oval City will be continuing forward.
“The customer is going to decide what the volumes are. Ford is able to balance production of gas, hybrid, and electric vehicles to match the speed of EV adoption in a way that others can’t,” Lawler said.
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