Ford honest about EV transition: ‘We were all a bit wrong’

Ford announced yesterday that the brand is reviewing its strategy for the coming years. The idea was to release an all-new electric SUV with three rows of seats and a new electric pickup next year. This deadline has now been extended to 2027. The reason is that the demand for EVs seems to be disappointing and it is very difficult to make a profit on plug-in vehicles.

Marin Gjaja, general manager of Ford’s EV business, talks to Detroit news. He explains that years of chip shortages painted a negative picture of the popularity of EVs. People took what they could get and if it happened to be an electric car, they took it. Buyers weren’t crazy about EVs, there was little alternative.

Fewer chips, more petrol cars

And the forecast is based on sales in years when there were few gasoline cars. Now that the world is slowly returning to the old normal, it seems that more and more people are choosing the petrol car again. By the way, it is not as surprising as it sounds: instead of EVs more than 70 percent, car brands sold EVs more than 50 percent in America in 2023.

He gives himself up Detroit news that patience runs out from making these kinds of mistakes, but he also says that the entire auto industry was a little bit wrong: “The truth is that we all made a little mistake.” The fact that Ford’s competitors have yet to succeed eases the pain.

It is difficult to reduce the price

It is also very difficult to reduce the prices of EVs without taking a lot of profit. “In general, EV pricing is very difficult,” a Ford employee said. Ford’s CEO says they need to be more efficient in building EVs so they can compete with Tesla and other automakers overseas.

The car brands are incorrect

Sales expectations for many auto brands were not met in the first quarter, according to Boston Consulting Group. For example, Tesla expected to sell 430,000 vehicles in the first quarter. There were less than 390,000. So even Tesla that is cutting prices so much is not meeting its stated goals. And that is reflected in the stock price.

Diversification will remain important in the near future

What is going in the right direction is the sale of hybrids. These vehicles with combustion engine and electric motor still play an important role. Buyers love it and it seems car brands can make a lot of money from this. BCG thinks manufacturers will be wise to invest at least as much in hybrids as in fully electric vehicles over the next five years.

Ford has announced that a hybrid version of every model will be available by 2030. This does not mean that Ford is stopping the EV transition. The brand is still on its way to a full electric range, but it just wants to get to this point a little later. Ford CEO Jim Farley says the company is committed to building a “profitable EV business.” According to him, the right time is needed for suitable petrol, hybrid and electric vehicles.