Ford’s electric vehicle division is bleeding billions, with losses growing year after year. Despite efforts to cut costs and improve production, the company warns that 2025 could be even worse.
Key Facts:
- Ford reported a **$5.1 billion loss** in its electric vehicle (EV) and software division for 2024, up from **$4.7 billion in 2023**.
- The company **expects losses to reach $5.5 billion in 2025** as EV challenges persist.
- Despite EV struggles, Ford’s **gas-powered vehicles remain profitable**, helping the company post a **$5.9 billion net income** in 2024.
- CEO Jim Farley warned that **potential tariffs on Mexico and Canada** could significantly hurt profits and lead to higher prices.
- While **General Motors’ EV division shows signs of profitability**, Ford’s EV lineup remains limited to **only three battery-electric vehicles**.
The Rest of The Story:
Ford’s push into the electric vehicle market continues to be a financial drag, with its Model e division posting billions in losses for the second year in a row.
The company’s struggles contrast with competitors like General Motors, which has expanded its EV offerings while keeping costs in check.
Although Ford remains profitable overall, thanks to its strong lineup of gas-powered vehicles, CEO Jim Farley acknowledged that 2025 could see a $2 billion decline in earnings due to the cost of new vehicle launches and declining prices across the industry.
Farley also addressed concerns over possible tariffs on Mexican and Canadian imports, warning they could devastate the U.S. auto industry if prolonged.
In an effort to adapt, Ford is pivoting toward a mix of powertrains, including hybrid and extended-range EVs.
However, its EV pricing remains a major challenge, with Farley admitting that just the battery pack for a Mustang Mach-E costs $18,000 to produce.
Ford hopes future manufacturing improvements will cut costs, but for now, its EV ambitions remain a financial burden.
Commentary:
Ford’s financial losses in the EV sector should come as no surprise.
The government’s relentless push for an all-electric future has forced automakers to rush production of vehicles that Americans aren’t buying in large numbers.
EVs remain expensive, have serious limitations in cold weather, and rely on charging infrastructure that isn’t nearly as developed as gas stations. Meanwhile, battery fires and high replacement costs add even more uncertainty.
Consumers have made their preference clear: they still want gas-powered vehicles.
Ford’s own sales numbers prove it—while EVs bleed billions, its traditional vehicles keep the company afloat.
The industry’s attempt to push EVs before the technology is truly ready has been a disaster, and Ford is a prime example of what happens when mandates override market demand.
Even Ford’s CEO acknowledges the issue. Farley openly admits that the cost of producing EVs is too high, yet regulations and corporate commitments have boxed companies like Ford into a corner.
Instead of letting consumer demand drive innovation, auto companies are being forced into an EV transition that isn’t working.
Ford’s pivot toward hybrid and extended-range vehicles is a step in the right direction, but the damage has already been done. The company is playing catch-up, and it’s unclear if or when its EV division will ever become profitable.
Meanwhile, competitors like GM are pulling ahead, adapting to market conditions without bleeding cash at the same rate.
Americans want a choice, not a forced transition.
Until EVs can match the affordability, convenience, and reliability of gas-powered cars, most consumers aren’t making the switch—no matter how much the government wants them to.
The Bottom Line:
Ford’s deepening EV losses show that forcing an industry-wide shift to electric vehicles isn’t working. As consumers continue to prefer gas-powered cars, Ford is pivoting, but not before burning billions in the EV experiment.
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