For the first time in its 120-year history, Ford Motor Co. It reported on Tuesday the quarterly effects of its three key business sets in regions, such as North America, in a bid to show investors how the company is preparing for more competitive competition. . as the industry shifts to all-electric vehicles.
Ford CEO Jim Farley split the company a year ago into Ford Blue (gasoline, hybrid), Ford Model E (electric vehicles) and Ford Pro (commercial products). Ford has already revealed that it expects to lose billions of dollars in the transition to battery-powered vehicles, and in the first quarter a loss of more than $700 million for the Model e. Characterizing the effort as more like a startup, Farley and CFO John Lawler play on the fact that all startups lose cash in the beginning, from Amazon to Tesla.
“We plan to be surgical,” Farley told industry analysts on the earnings call, later adding, “We’re satisfied, but we’re not satisfied. “
Earlier Tuesday, Ford revealed plans to momentarily cut costs in 4 months on the Mach-E, a direct competitor to the Tesla Model Y. With the reopening of order banks and the renovation of a plant in Mexico to dramatically increase production more efficiently, Ford said. It may only cut costs in an attempt to increase its market share.
Ford Chief Financial Officer John Lawler said in a call to the convention that the new procedure “sharpens our focus, speed and accountability,” resulting in “solid” effects this quarter.
The company spent billions on electrification last year and plans to do the same this year, which Ford sees as an investment. The Ford Mode e is still profitable, but the Model e is on track to break even for its first-generation electric cars through the end of 2024, Lawler said.
He said the EV landscape is competitive and once other people buy a brand, they tend to stick to it. That’s why Ford aims to capture EV consumers from the start of the game, he said.
Farley said in a news release that running the company on behalf of separate visitor teams has produced “strong operational effects and insight into the promise of their new plan. “volume of products while creating revolutionary next-generation cars from the ground up. “
Ford’s market share is necessarily static, but transaction costs are not, according to a Cox Automotive report released Tuesday:
Garrett Nelson, senior equity analyst at CFRA Research, released a note Tuesday advising investors to buy Ford stock. First-quarter earnings are “much stronger than expected. “
On April 25, General Motors reported a pretax profit of $3800 million, down 6% from a year ago, due in part to costly electric vehicle deployments and production problems similar to portion shortages. GM has taken a $994 million fee to pay for its purchases of salaried workers and its buyback program for Buick dealers who don’t need to sell electric vehicles.
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Contact Phoebe Wall Howard: 313-618-1034 or phoward@freepress. com. Follow her on Twitter@phoebesaid