“With pricing and margin compression, we’ve made the decision to adjust our product and technology roadmap and industrial footprint to meet our goal of reaching positive EBIT within the first 12 months of launch for all new models.”
A significant shift in Ford’s strategy includes the decision to incorporate hybrid technology into its upcoming three-row SUVs rather than making them fully electric. This change is driven by the need for energy efficiency and cost-effectiveness. Consequently, Ford will write off approximately US$400m in non-cash costs related to manufacturing equipment for the now-cancelled all-electric three-row SUVs.
This adjustment could also result in up to US$1.5bn in additional costs, which Ford will report as a special item in the quarter when these costs arise.
Ford’s next wave of energy-efficient EVs will commence with a commercial van, set to be produced at the Ohio Assembly Plant in 2026. Ford already leads in the commercial EV space, particularly with the E-Transit, the top-selling electric van in the US. Commercial customers are rapidly transitioning to EVs, driven by the significant energy and cost savings these vehicles offer, alongside increased productivity.
Transforming EV development for greater energy efficiency
In 2022, Ford established a dedicated team in California to revolutionise how it develops energy-efficient EVs and reduce associated costs. This team uses a systems-integration approach, working across design, engineering, supply chain and manufacturing to streamline processes and drive down expenses.
