Ford adjusts EV lineup as it aims to lower vehicle cost

Ford announced Wednesday fresh changes to its electric vehicle lineup, including the scuttling of a planned SUV model, lifting shares despite a hefty near-term profitability hit.

The adjustments -- which reflect a slower-than-expected transition to EVs in North America -- will result in around $1.9 billion in cost hits to Ford's earnings, according to a Ford securities filing.

A company news release describing the changes highlighted competitive pressures including low-expense Chinese EV producers and the heightened cost focus of current EV consumers compared with early EV adopters, who view the autos "as a practical way to save money on fuel and maintenance, as well as time by charging at home."

Ford's EV business lost about $2.5 billion in the first half of 2024 as the company contends costly production ramp-ups amid demand uncertainty.

Among the changes, Ford is dropping a plan to produce a three-row electric utility vehicle that had previously been expected to be constructed in Oakville, Ontario.

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Ford, which had previously pushed back the timing of the offering, will no longer produce the vehicle at all but plans to employ some of the technology for a hybrid offering.

Ford also pushed back the timeframe for a new "next-generation" EV pickup truck to the second half of 2027 after previously saying production would commence in 2025.

Ford also announced plans for a more affordably priced EV pickup that will be midsized and launch in 2027.

Finally, Ford plans a new EV commercial van to begin production in 2026.

"We have built a plan that gives our customers maximum choice and plays to our strengths," said Chief Executive Jim Farley, adding that the company has "learned a lot" from its EV business so far.

Shares of Ford rose 2.1 percent in morning trading.

Source: AFP