Ford EV Overhaul Raises Profitability Concerns

about 1 month ago

Lisa Mateo

"Okay, I want to start with Ford ticker F. uh their shares have been up as much as 1%. So we've been talking about it. Ford taking a nearly $20 billion in charges tied to that overhaul of its EV business. Um the majority of those charges are going to come in the fourth quarter. So what it includes it it's cancelling this planned electric F- series trucks. It's shifting production toward gas and hybrid vehicles. It's repurposing an EV battery plant. And we know Ford's been struggling for years, right, to make that unit profitable. Uh the division lost 5.1 billion last year. The company expects losses could be worse this year. Uh the changes make Ford's EV operations profitable by, get this, 2029. That's when they expect to be profitable. But you we heard Jim Farley tell Bloomberg TV it just didn't make sense to keep putting billions into products that they knew would would not make any money."

The commentary highlights Ford's significant restructuring of its EV division amid nearly $20 billion in charges and persistent profitability issues. With an expectation to turn profitable only by 2029, the analysis questions the rationale of continuing heavy investments in unprofitable EV products, implying a bearish stance on the stock.

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