Jim Farley: EV adoption will take longer than expectedFord reported another nice BEAT for Q2 which was derived from continuing to fleece its ICE customers. Profits are so strong that Ford increased its earnings guidance for 2023 by $2 billion up to $12 billion
Meanwhile, Ford sustained a $1.1 loss on its EV division for the quarter which means that the company will lose more than $4 billion this year trying to figure out how to build a profitable EV.
Here is a question for all of "gas powered vehicles forever" crowd:
Why would Ford choose to lose $4 billion+ this year on EV's?
I can answer that question for you, but I want you to think about it.
When you have chewed through that one, I want to ask you another question:
How you feel about buying a Ford when you know that they are not even trying to hide the fact that they are massively over-charging for their ICE vehicles in order to fund the development of their EV platform?
Ford has openly admitted that they are transitioning to EV's. They have also admitted that they are transitioning as fast as they can. To that end, they recently slashed the price of the EV trucks by $10,000. Of course Farley said the price cut was due to lower costs despite the fact that the company lost almost $50k per EV that they sold in Q2. I guess the price cut had nothing to do with the fact that Tesla will be introducing its Cyber Trucks by the end of Q3.
Don't worry, we all know that we can TRUST Ford to look after our best interests.
How do you think existing Ford Lightning customers feel about suddenly seeing the value of their Lightning's drop $10k?
Existing Lightning owners are assured of facing further price deterioration when Tesla starts pumping out hundreds of thousands of Cyber Trucks at lower prices. To that end, Elon recently said that the Lightning was a good truck but expensive AFTER Ford announced the $10k price reduction.
For years now, the good ol' boys have financed the construction of Tesla factories through the payment for environmental credits. Tesla has used those credits to put legacy auto makers up against the wall.
Instead of asking why the legacy auto makers have been so stupid, you might consider that they have simply been passing the costs on to every ICE car buyer for years. In fact, if you have bought an ICE vehicle in the past few years, you have actually been paying Tesla to build EV factories.
The next time you think about over paying for an ICE vehicle (which you will because the legacy auto makers are not even trying to hide the fact), remember that you are subsidizing EV makers that are going to make your ICE vehicle obsolete long before the end of this decade. Every day that goes by, that reality increases.
Meanwhile, congratulations to Ford and GM and Stellantis who are making historical profits from the undying loyalty of their customers.