Ford has once again hit the brakes on battery electric vehicles as it shifts focus to hybrids in the European market as local customers’ demand moves in that direction.
Ford attends to European customers’ preference for hybrids
The American legacy automaker announced a major pivot from its original plan to become an all-electric brand in Europe by 2030. Now, Ford has confirmed that gas-powered vehicles will remain available in the local market past that date.
Ford’s European business head also implied that Ford could focus on hybrids instead of all-electric vehicle models, Reuters reported, citing Ford’s exclusive statement.
“As EV adoption in Europe has slowed, we believe we need to offer our customers ICE and hybrid vehicle options beyond 2030.”
Ford
Ford’s Head of European passenger car business reiterated the company’s new strategy.
“If we see strong demand, for instance, for plug-in hybrid vehicles, we will offer them.”
Martin Sander, Head of European passenger car business at Ford
Hybrid electric vehicles have emerged as a strong alternative to expensive battery-electric vehicles. In effect, they have witnessed remarkable demand and sales growth over the past year. It prompted numerous automakers to delay or cancel their prior EV strategies.
Q1 2024 losses
Ford’s electric vehicle unit, Model e, suffered huge losses in the first quarter of 2024.
Ford Model e lost a total of $1.3 billion in Q1 2024, equating to $132,000 for every unit of the 10,000 EVs it sold then. As a result, its total earnings also recorded a huge decline.
It is also worth noting that the 10,000 EV sales from January to March 2024 represent a 20% year-on-year drop, according to Ford’s report.
It also recorded a tremendous revenue drop of 84% to about $100 million due to the intensifying industrywide price cuts, as explained by Ford.
Ford remains committed to an all-electric future but with a less aggressive push
Ford will have no choice but to shift to all-electric vehicles by 2035 with the imminent ban of new gas-powered vehicle sales in Europe by 2035.
Fortunately, the company remains committed to a total transition even with a less aggressive strategy.
“We are not going to pay penalties. We are not going to sell electric vehicles at huge losses just to buy compliance. The only alternative is to take our shipments of ICE vehicles for the United Kingdom and sell them somewhere else.”
Martin Sander, Head of European passenger car business at Ford
Ford’s strategy pivot is unsurprising, considering how its BEV sales fared in the past quarters. It demonstrates the company’s unpreparedness to fully commit to all-electric vehicle models and the customers’ stronger preference for an alternative that bridges the gap between gas-powered cars and BEVs.
