Ford loses almost $50k on every electric car. But it's not so clear-cut

Ford is investing billions of dollars in electric vehicles, but, like many other automakers, has found that developing electric cars without incurring massive financial losses is a challenging task.

The financial report for Ford's second quarter indicates that the Ford Model E electric vehicle division incurred losses of $1.1 billion. During this period, the division sold 23,957 electric vehicles in the U.S., which translates to an approximate loss of $47,600 on each vehicle sold.

However, these calculations are not entirely accurate, and the per-vehicle loss figure does not provide a complete picture. Ford separated its internal combustion engine and electric vehicle production lines at the beginning of 2022. The newly established Ford Model E division is currently channeling substantial investments into developing new and innovative electric powertrains. These investments are not likely to recur annually, and they will benefit future electric vehicles. Therefore, it would make sense to spread the losses over a longer sales period. Such an analysis can only be conducted several years down the line.

Taking into account a poor first quarter, Ford Model E reported losses of $2.5 billion for the first half of this year, with total losses by year-end projected to range from $5 billion to $5.5 billion.

During the second quarter, Ford sold 536,050 vehicles in its domestic market. This represents an increase of less than 1% compared to the same period last year. Nevertheless, first-half sales grew by 3.6%, surpassing 1 million units. It is significant that demand for Ford’s electric vehicles surged dramatically in the second quarter, rising by 61%. However, electric vehicles still account for only a small fraction of Ford's total sales, approximately 4% in the first half of 2024.

At the same time, the situation in the electric vehicle market has turned out to be less promising than anticipated. In May, it became known that slower-than-expected sales of Ford's electric vehicles prompted the manufacturer to reduce the number of batteries it orders from suppliers.

Conversely, the supply of Ford’s hybrid models saw a substantial increase, reaching a record 53,822 units sold, marking a 56% growth. This surge was primarily driven by increased interest in the Maverick, while the Mustang Mach-E emerged as the brand's top-selling electric vehicle.

Source: carscoops