FORD LOST $130,000 ON EVERY EV IT SOLD IN THE FIRST QUARTER
- Ford's Model e EV division reported a net revenue of around $100,000 in the first quarter.
- Adding in expenses, though, the Blue Oval's EV arm lost $1.3 billion for the quarter.
- Ford largely blames margin-cutting price cuts for the massive drop in revenue compared to Q1 2023.
Ford reported a net income of $1.3 billion for the first quarter of 2024, a figure largely bolstered by the success of the company's Ford Pro fleet division and the $3 billion it brought in—more than three times that of the internal-combustion-engine-focused Ford Blue arm. The Blue Oval's battery-electric–oriented Model e division, however, remained a drain on company funds, losing $1.3 billion for the quarter—around twice what it lost during the same period in 2023. The company blamed "industry-wide pricing pressure" in its first-quarter earnings presentation.
To put these numbers in perspective, Ford Pro made approximately $7300 for each of the more than 400,000 vehicles it sold after accounting for expenditures but not interest or taxes (EBIT). Ford Blue pocketed close to $1400 for each of the more than 600,000 vehicles it sold under the same conditions.
Model e, on the other hand, lost close to $130,000 per vehicle on the approximately 10,000 EVs it moved in the first quarter of 2024. And that's before putting interest or taxes into the equation.
Even the good news for Model e is... well... not that good. Take the division's reported revenue of around $100 million, which should be cause for some celebration. Because even if that figure falls far short of covering the Model e's various expenses, it's at least a positive figure on its own. Except that $100 million in revenue marks an 84 percent drop compared to the first quarter of last year. This is despite sales only being down by around 20 percent relative to the same period a year prior.
Why the big hit to revenue then? Ford blames the losses on the price cuts it made to its EVs in response to changing market conditions. With the battery-electric space continuing to grow, Ford may find itself in a position to need to cut prices again—something it appears that the automaker quite literally cannot afford to do.
At the same time, Model e's rising expenses will hopefully put it and Ford in a better position in the coming years, as some of that money is going toward the development of the company's next-generation EVs. If all goes according to plan, these battery-powered Fords will greatly increase Model e's future revenue figures.
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