Ford Motor Co. is expecting its loss on electric vehicle (EV) business to grow to 3 billion U.S. dollars in 2023, The Detroit News quoted the U.S. automaker Thursday as saying, APA reports.
The Dearborn-based company lost 900 million dollars in EV business in 2021 and 2.1 billion dollars in 2022.
Ford Chief Financial Officer John Lawler attributed the uptick in EV losses to the large investments Ford is making to scale up its EV business. Ford is investing billions of dollars in developing its second- and third-generation EVs, and to build numerous EV battery plants, he said.
Meanwhile, Ford is moving to scale up EV production to an annual run rate of 600,000 units by the end of this year and further to 2 million units by the end of 2026. The automaker hopes to reserve the losses in the coming years as the volumes of EVs grow, and hit an 8-percent operating profit margin for the EV business by the end of 2026.
Ford will begin reporting results for each of its business units this year, instead of reporting key financial metrics by geographic region. The business units fall into three segments: gas and hybrid vehicles, commercial customers and EVs and software.
Ford is projecting 7 billion dollars in operating profit for the gas and hybrid business and roughly 6 billion dollars for commercial business this year.
In 2021, Ford's gas and hybrid business posted adjusted operating profits of 3.3 billion dollars, and the commercial business had adjusted operating profits of 2.7 billion dollars. Those results contributed to adjusted operating profits of 10 billion dollars for the year.
In 2022, the gas and hybrid business grew to 6.6 billion dollars in adjusted operating profits, while adjusted operating profits for commercial vehicle business grew to 3.2 billion dollars. The adjusted operating profits for the year were 10.4 billion dollars.