Ford with a new strategy for electric cars

The US car giant Ford wants to invest more money in the development of smaller electric cars instead of larger vehicles. He assumes that this will also be an industry-wide trend, said Ford boss Jim Farley on Tuesday. It turned out that customers are interested in electric vehicles, but many do not want to pay a high premium for them. At the same time, Farley reiterated that the transition to electric cars was inevitable from the group’s perspective.

• also read: Upheaval in the e-car industry

During the corona pandemic, the rapidly increasing electric car sales at the time fueled exaggerated expectations of future demand, said Farley. Investments should now be more closely aligned with actual interest. The cheaper Tesla model and vehicles from Chinese manufacturers would become “the ultimate competition” in the future. Tesla is expected to begin production of its new vehicle at the end of 2025.

Waiver of certain functions

Ford also wants to save money by foregoing functions that are of little interest to customers. As an example, Ford manager Kumar Galhotra cited the automatic parking system, which “very, very few people use.” So Ford could remove the function – and save $60 per vehicle, which amounts to around $10 million a year.

The electric car division’s operating loss rose to $1.57 billion (1.46 billion euros) in the last quarter. In contrast, the commercial vehicle business generated an operating profit of $1.8 billion. Beyond that, Ford earned $813 million from combustion and hybrid vehicles.

Hybrid drives as bestsellers for US car companies

Hybrid drives have become a bestseller for US car companies in recent months – also because they are cheaper than battery-powered vehicles. At the same time, Ford emphasizes that more electric models are also being purchased for commercial vehicles.

In the last quarter, the US car giant continued to make high losses with electric cars. Ford posted a loss of $526 million (around €489 million). In the same quarter last year there was a profit of around $1.3 billion. However, Ford management emphasized that the weeks-long strike by the US union UAW had cost the company $1.7 billion. Meanwhile, sales grew year-on-year from $44 to $46 billion, as Ford announced after the US stock market closed on Tuesday.

Ford shares rose around six percent in after-hours trading. The numbers were above analysts’ expectations.