Posted on 03/23/2023 9:21:08 AM PDT by Red Badger
KEY POINTS
Ford Motor said Thursday its electric vehicle business lost $2.1 billion in 2022 on an operating basis.
That loss was more than offset by $10 billion in operating profit between its internal combustion and fleet businesses.
The financials are the first detailed look at EV profitability as Ford unveils a new financial reporting structure.
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Ford Motor said Thursday its electric vehicle business lost $2.1 billion last year on an operating basis, a loss that was more than offset by $10 billion in operating profit between its internal combustion and fleet businesses.
The Detroit automaker expects 2023 to unfold along similar lines, forecasting an adjusted loss of $3 billion for its EV unit, adjusted earnings of about $7 billion for its internal combustion unit, and adjusted earnings of roughly $6 billion for its fleet business.
The financials are the first detailed look at unit profitability as Ford unveils a new financial reporting structure that aims to give Wall Street a better understanding of how its electric vehicle business is evolving — and how profits from its internal combustion businesses are funding its electric transformation.
The reformatted reports follow a sweeping reorganization, announced in March 2022, that divided Ford’s global business into five business units: “Ford Blue,” its traditional internal combustion engine business; a new “Ford Model e” electric vehicle unit; “Ford Pro,” containing its commercial and government fleet business; “Ford Next,” which includes nonautomotive mobility solutions and other future tech; and its existing Ford Credit financial services subsidiary.
“We’ve essentially ‘refounded’ Ford, with business segments that provide new degrees of strategic clarity, insight and accountability to the Ford+ plan for growth and value,” CFO John Lawler said in a news release. Lawler said the new reporting structure is a reflection of how he, CEO Jim Farley, and other senior Ford executives are now thinking about and operating Ford’s businesses.
Ford on Thursday shared versions of its 2021 and 2022 financial results that had been restated according to the new format to give analysts and investors a basis for comparison going forward. Those revised results show that while Ford Model e, the company’s EV unit, lost $2.1 billion last year, Ford Blue and Ford Pro generated $6.8 billion and $3.2 billion of adjusted operating income, respectively.
Those 2022 Model e losses more than doubled unit losses from 2021, as the company continues to ramp up EV production.
Ford reiterated Thursday that it expects to be building EVs at a rate of 2 million per year by the end of 2026. It hopes to achieve a 10% profit margin on an EBIT basis by that time, with an 8% adjusted EBIT margin for Ford Model e.
Before the restructuring was announced, some Wall Street analysts had urged Ford to spin off its EV business. But Farley and other executives argued that keeping the EV unit in house allows it to draw on the existing manufacturing expertise and other strengths now housed in Ford Blue and Ford Pro. This gives it a significant advantage over so-called “pure play” EV startup companies that have had to create manufacturing bases from scratch, they said.
The company hopes that the new financial reporting structure will help analysts and investors understand how profitable its core internal combustion businesses are, while making it easier to track the progress of Ford’s overhaul over time.
Ford will hold a “teach-in” to explain the new reporting structure to investors and analysts at 10 a.m. ET on Thursday. A live webcast of the event will be made available at Ford’s investor relations site.
The automaker will report its first-quarter results May 2 and will provide a deeper dive into its strategy and the progress of its restructuring efforts at its annual Capital Markets Day on May 22.
Ping!..................
Considering the cheap F-150 starts at $33,695 and goes up quickly from there, it’s no wonder their legacy lines are making profits.
Heard news this AM saying they expect to be making profit in 2026.
People are buying ICE cars and trucks in anticipation of them disappearing from the market in a couple of years!...............
For example, was one the reasons Ford heavily pushed the F-150 Lightning (EV), was it to increase their overall fleet miles per gallon to reduce CAFE fines? Or maybe they were hoping Ford would get some of the fake carbon credits that Tesla gets so that Ford could take in money every time the government jizya taxes, I mean carbon taxes, someone?
Phase 1: Build EVs
Phase 2: ?
Phase 3: Profit!
I expect to win the lottery by 2026..............
“People are buying ICE cars and trucks in anticipation of them disappearing from the market in a couple of years!”
Yup, or doing what I’m doing, restoring old Classics. We will look like Cuba in 20 years.
Classic cars will never be junked. Too valuable, because they can be repaired.
Government central planners forcing America to switch to EV’s is really about everyone driving less, pushing people to public transit, social-engineering cities, and limiting freedom
When the TRUE costs of EV’s are calculated, half of Americans now with cheap ICE cars now will not be able to afford to drive
They are counting on unicorns and leprechauns to save them😏.........
Ford got Biden’d!!!
Fords business model...
1. Build EVs and expect billions in losses per year
2. Continue to build ICE vehicles and expect huge profits from them each year.
3. Use the ICE vehicles’ profits to offset the expected EV losses every year.
4. Continue with the insanity until EVs become profitable, hopefully before 100 years of EV sales.
5. If the plan doesn’t work, kill the ICE divisions and force people to buy only EVs.
The Dims also get my attention when they persistently demand everybody drive an EV while also making it harder and more expensive for power companies to generate electricity. The main reason I'll probably always have an ICE pickup.
Fur that means not all of our transportation eggs are in one basket. If the Dims make gas hard to come by, we have an EV. If they make power hard to come by, we have the ICE pickup. And for the house and local driving we have our own solar power. Think less save the world gaia BS and more prepping against government control of energy and transportation.
Same as GM, Chrysler, Honda, Toyota, Nissan, VW, Volvo, Hyundai, KIA..................
Loosing money on EV’s? Simple. Move the assembly plant to Ukraine and collect government subsidies.
Yes, that's a good way to see it. Where I live, I expect NY state/Fed government to eventually destroy our local gas provider. NY state is already talking about banning gas stoves and furnaces.
Assuming woke-progressives will turn us into another South Africa, I would like to have solar on my house, to be independent of the crappy grid they will create.
That 2 billion dollar loss will be recouped via higher costs on their internal combustion cars and trucks. So when you buy an internal combustion vehicle, you are in effect subsidizing electric vehicles.
I have no problem with electric vehicles. I have a problem with subsidies for them and thus the distortion of true market forces. If the free market was allowed to operate few electric vehicles would be sold.
Below is a quote of President Ronald Reagan:
“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
“
No "rules for thee but not for me".
The Dodge CEO said recently they had to stop building and selling muscle cars because of their investment in EV’s.
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