Amid a shift in strategy, Ford (F) reported first-quarter effects on Wednesday, beating analysts’ expectations. However, due to price pressure, Ford’s EV earnings fell as much as 84% in the first quarter of 2024.
Despite an 86% increase in EV sales to 20,233 in the first 3 months of 2024, Ford is pulling back. All of Ford’s electric models saw double-digit (or 3-digit) sales growth.
The F-150 Lightning remained the best-selling electric pickup truck in the U. S. The U. S. is the largest U. S. model, with 7,743 models sold, up 80% from last year. Ford’s Mustang Mach-E, the second best-selling electric SUV in the U. S. The U. S. is leading the U. S. , with 9,589 cars delivered, up 77% from the first quarter of 2023.
Meanwhile, Ford’s Pro unit continues to look like a dark horse for the automaker, with EV adoption up 40%. Ford E-Transit sales increased 148% in the first quarter, with 2,891 units sold.
Ford’s expansion has propelled it into second place in the U. S. electric vehicle market. (excluding combined Hyundai and Kia sales).
The increase in sales comes after Ford implemented significant price cuts and savings on Mach-E and Lightning earlier this year.
Despite rising EV sales, Ford has announced that it will postpone EV production at its BlueOval City plant until 2026. It’s also delaying the launch of its three-row electric SUV for smaller, more affordable EVs.
Meanwhile, Ford has announced that it will introduce more hybrids as its next-generation models are developed.
Ford’s Model e EV unit posted a loss of about $4. 7 billion last year on “extremely competitive pricing” and new investments. Meanwhile, the EBIT loss fell to $1. 6 billion in the fourth quarter.
Analysts expect Ford to report a profit of $40. 10 billion in its first-quarter 2024 earnings report. Ford’s Model e EV unit is expected to generate a profit of about $24. 5 billion with an EBIT loss of $1. 65.
Ford reported that its first-quarter 2024 profit rose 3% to $42. 8 billion, beating estimates by about $40. 1 billion. Ford also beat adjusted EPS estimates by $0. 49, consistent with the constant percentage in the first quarter compared to $0. 42 expected.
The automaker posted a profit of $1. 3 billion, up from $1. 8 billion last year. Adjusted EBIT fell 18% to $2. 8 billion due to lower costs and the F-150 launch schedule.
Ford Blue, the company’s ICE business, posted a 13% profit drop due to the launch of the new F-150.
Ford Pro was the driving force behind the growth, with volume and earnings up 21% and 36%, respectively. The business and software business reported an EBIT margin of approximately 17%, with a profit of $18 billion in the first quarter.
Meanwhile, Ford Model e earnings fell 84% due to “industry-wide” price pressure. With lower prices, the unit’s EBIT loss increased year-over-year to $1. 3 billion. That’s a loss of about $64,000 for every electric vehicle sold. in the first trimester. However, this is still lower than the EBIT loss of $1. 6 billion in the fourth quarter of 2023.
Meanwhile, Ford has announced that it will introduce more hybrids as its next-generation models are developed.
Yes, it makes perfect sense to build a more complex vehicle that requires more portions to reduce prices and generate revenue. ?
Ford expects EV prices to rise in the future, but this will be offset by pressure on earnings.
The automaker maintains its full-year EBIT guidance, expecting to reach the upper end of the $10 billion to $12 billion range. The company now expects to generate between $6. 5 billion and $7. 5 billion in adjusted cash flow, compared to $6 billion at $7. billion before.
According to Ford, the updates reflect recent cost-cutting measures, such as delayed investments in electric vehicles. Ford’s update comes after rival GM also raised its full-year guidance this week.
Meanwhile, Ford is launching a new logo campaign called “Freedom of Choice” to promote its gasoline, hybrid and electric lineup starting with the strategy update.
Peter Johnson covers the automotive industry’s step-by-step transformation to electric vehicles. He is a seasoned investor, money writer, and electric vehicle enthusiast. His enthusiasm for electric vehicles, primarily Tesla, is one of the main reasons he pursued a career in investing. If he doesn’t tell you about his latest discoveries in the 10K, you can spot him enjoying the outdoors or exercising.