Ford Motor Company has revealed plans to develop a range of new hybrid models, despite its ongoing commitment to electric vehicles (EVs) [1]. CEO Jim Farley stated that customers appreciate the efficiency and added capabilities provided by hybrid systems, which may explain the company’s decision to expand its hybrid offerings[1].
Although Ford is not abandoning its EV initiatives, the company has acknowledged that the ramp-up of EV production may take longer than initially anticipated[1]. In the meantime, Ford is investing in hybrid technology, driven by the success of its current gasoline-electric options[1].
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This move comes as Ford and other automakers face challenges in transitioning to EVs, including costly recalls and reputation-damaging incidents such as vehicle fires and sudden power loss[3]. Ford has previously recalled around 20,500 Kuga plug-in hybrid crossovers in Europe due to safety concerns[3].
Despite these setbacks, Ford remains committed to a greener future. The company’s strategy aligns with those of other automakers, such as Stellantis and Toyota, which are also investing in electrified hybrid models. As the global EV market continues to mature, Ford’s focus on hybrids may help bridge the gap between traditional internal combustion engines and fully electric vehicles.
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Ford’s decision to focus on hybrids is also influenced by the financial challenges faced by its EV division. The company has reported a $4.5 billion loss from its EVs in 2023, up from an earlier forecast of a $3 billion loss. Ford is currently locked in a price war with other EV manufacturers, particularly Tesla, which has slashed prices in both the U.S. and China to boost sales and capture market share[4].
Despite the losses, Ford remains optimistic about the future of EVs. CFO John Lawler said, “The transition to EVs is happening, it just may take a little longer. Ford is still targeting an 8% operating margin for its EV business and is not planning to reduce its capital spending on the vehicles.
In the meantime, Ford’s hybrid lineup continues to grow, with models such as the Escape Hybrid, Escape Plug-in Hybrid, and the Maverick hybrid truck. As the EV market evolves, Ford’s investment in hybrid technology may serve as a stepping stone towards a fully electric future.
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Citations:
[1] https://www.cnbc.com/2022/09/13/why-toyota-the-worlds-largest-automaker-isnt-all-in-on-evs.html
[2] https://fordauthority.com/2023/06/2020-2023-ford-hybrids-recalled-over-engine-fire-risk/
[3] https://www.ford.com/new-hybrids-evs/
