Just four years ago, Ford Motor seemed poised to give Tesla a real run for its money in electric vehicles.
In 2021, the company introduced a stylish electric sport-utility vehicle, the Mustang Mach-E, and quickly followed it a year later with a battery-powered version of its best-selling pickup, the F-150, and an electric van. The three new models gave Ford a jump on other established automakers like General Motors.
But then the growth of electric car sales slowed and Tesla started slashing car prices. At the same time, higher material costs made it harder for established carmakers to make money on electric vehicles.
Over the last two and a half years, Ford’s electric vehicle division has lost $12 billion, including $2.2 billion in the first half of this year. This year, sales of its electric models have stalled, falling 12 percent in the first six months.
Now Ford has come up with a new plan. On Monday, the automaker said that it has developed new, lower-cost electric vehicle components that will allow it to sell more affordable cars. The first will be a medium, four-door pickup truck that will arrive in showrooms in 2027, Ford said. At the same time, the launch of a new large electric pickup truck will be delayed by a year to 2028, the automaker said.
The company also said it has developed a new manufacturing process that should also lower costs while improving quality.
“To be fully competitive, we felt we needed to start with a clean sheet,“ said Jim Baumbick, Ford’s vice president of advanced product development.
Turning around Ford’s electric vehicle business is a key task for Ford’s chief executive, Jim Farley. He was named to the post in 2020, and promised a new era of growth and profitability for a company that struggled under two previous chief executives.
Mr. Farley has made some progress. The company’s European operation is performing better financially than before he took over, as are its joint-ventures in China. Its stopped selling money-losing cars in India.
But Ford is still grappling with significant issues. In addition to its money-losing electric vehicle business, the company has spent billions of dollars in recent years to recall and repair gasoline-powered cars.
As a result, profits from Ford’s main business of selling internal-combustion trucks and S.U.V.s have slumped in recent quarters. In the first half of this year, Ford’s division that makes gasoline cars and trucks for individual buyers made $757 million, down from $2.1 billion in the same period in 2024.
Mr. Farley has previously scaled back some of Ford’s electric vehicle efforts, lowering investments and putting on hold one of four new battery plants the company had planned.
Ford’s troubles stand in contrast to what has been happening at G.M., which took a slower path on electric vehicles by taking time to develop standardized batteries that helped lower costs. G.M. also formed joint ventures that relatively quickly built two factories to churn out batteries. For the last few years, G.M. has reported near-record profits, although in the second quarter its profit fell by about a third to $1.9 billion in part because of high costs related to tariffs imposed by President Trump.
In the second quarter, G.M. sold more than 46,000 electric vehicles, second only to Tesla and more than twice as many as Ford. G.M. also has more than 10 electric models on sale, ranging from the $35,000 Chevrolet Equinox EV to the $130,000 Cadillac Escalade IQ.
Ford executives are counting on a new $3 billion battery plant it has built in Marshall, Mich., about 100 miles west of Detroit, to help revive its electric vehicle business. The plant will make batteries cells using lithium, iron and phosphate, a combination referred to as LFP. Such batteries costs less than those most commonly found in U.S. electric vehicles because they do not use nickel and cobalt, which are relatively expensive.
Ford licensed the LFP technology from a Chinese company, CATL, the world’s largest battery maker. Ford and SK On, a South Korean company, are also building two battery factories, one in Kentucky and the other in Tennessee.
The electric vehicle assembly process that Ford has developed is modification of the moving assembly line that was first pioneered a century ago by its founder, Henry Ford. Instead of using one long assembly line, the new process has three: one to build the front end of the electric pickup, one for the back and one for the battery pack and cab.
Ford said the three branches come together into a single line where the three pieces are joined. The company estimated that will reduce the time it takes to assemble a pickup by 15 percent.
The new line will be set up at a Ford factory in Louisville, Ky. Ford said it would invest $1.9 billion in the facility, where it makes the Ford Escape and Lincoln Corsair small S.U.V.s. Production of those vehicles is scheduled to stop next year.
Ford said that once production in Louisville ends, it will no longer offer the Escape. That model was introduced in 2000 and has been one of the company’s best-selling S.U.V.s.
Neal E. Boudette is based in Michigan and has been covering the auto industry for two decades. He joined The New York Times in 2016 after more than 15 years at The Wall Street Journal.
The post Ford Rejigs E.V. Plans After Suffering Billions in Losses appeared first on New York Times.
