Ford CEO Fumbles Its EV Failure

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Ford CEO Jim Farley keeps changing his view on EVs. Two years ago, Ford planned to invest as much as $30 billion in EVs. Suddenly, the company’s bright figure is its “Pro” division. He asked analysts to ignore Tesla and look closely at Ford’s highly profitable operations as if the change in direction could fool anyone.

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According to CNBC: “Ford Pro is made up of the automaker’s traditional fleet and commercial businesses as well as emerging telematics, logistics and other connective operations for business customers – ranging from local plumbers and electricians to massive corporations. It also includes parts and services for businesses.”

Pro should make $8 billion to $9 billion this year. Ford’s traditional car business should make as much as $7.5 billion. Ford’s EV business is expected to lose as much as $3.5 billion.

Farley is trying to downplay the largest failure in Ford’s history, and that failure may get worse as China’s EV companies move into the US market. Ford’s F-150 Lightning and Mustang Mach-E should have been successful EVs based on the power of their brands. Ford sold fewer than 3,000 Lightning units and 2,000 Mach-E models in the first month of the year.

Farley made two astute comments reinforcing Ford’s problems as it tries to get an even modest amount of the EV market. The first is that Ford will have to reconsider its EV plans because of a new, rich UAW contract, which will cost Ford $8.8 billion over the course of the deal. And, Chinese EV companies may move production to Mexico, which is a back door to the US and an opening for the Chinese to get sub $20,000 price cars into America. The day that happens, Ford runs out of EV options. It will have lost its chance.