Ford’s EV plans take latest backstep with European retreat in favor of hybrids

2024.05.09 3 min read

Ford’s electric vehicle plans have taken yet another backstep as its European business head hinted that the automaker could favor hybrid electric vehicles as consumers lead in that direction.

Ford reported massive losses on its EV business in Q1, and although sales in April were at an all-time high, it is no secret consumer interest is cooling off. It also said it would scale back EV investments from $10 billion to between $8 billion and $9 billion, CEO Jim Farley confirmed.

Hybrids are becoming a thorn in the side of companies that are committed to widescale EV efforts.

Ford doubles down on EVs despite heavy losses in Q1

Tesla even said in its Q1 Shareholder Deck that automakers are starting to put more energy and effort into hybrids, which has been a major pressure point of EV adoption, especially since late 2023 and into early 2024.

Ford is ready to adjust its game plan with EVs, especially in the European market. Today, Martin Sander, the head of its European passenger car business, told FT that hybrid EVs are definitely a potential offering, especially if consumers show interest:

“If we see strong demand, for instance, for plug-in hybrid vehicles, we will offer them.”

Regardless of whether Ford is ready to or not, it will have to transition to all-electric vehicles by 2035 due to European laws that plan to phase out gas-powered vehicles. It seems that Ford and Sander are ready for that as well, but their transition will be less aggressive than previously planned.

Sander said Ford will “manage our way toward 100 percent electric drivetrains,” but it is well aware that the financials have to make sense.

“We are not going to pay penalties. We are not going to sell electric vehicles at huge losses just to buy compliance,” Sander said, evidently wanting to avoid any further complications and financial implications because of regulatory hurdles. “The only alternative is to take our shipments of ICE vehicles for the United Kingdom and sell them somewhere else.”

Ford is scaling back its EV plans in an effort to remain afloat. It has not been an easy road thus far, and it evidently is not ready to make a full-fledged effort to produce only EVs if consumers are not ready to adopt them. They will simply go elsewhere.

Toyota is one company that has been more hesitant to dive into a fully electric lineup, opting for other modes like hybrids and hydrogen. Ford may want to consider taking a page out of the Japanese company’s book as it needs to avoid losing more money to an overcommitted EV narrative that is costing the company millions every quarter.

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