Ford Motor (F.N) may have dealt with its labor problem. The next challenge can’t be solved with a negotiation. Like cross-town rival General Motors (GM.N), results unveiled on Thursday show the Detroit-based automaker’s gas-burning cars still command higher prices, though their operating profit came in nearly 9% below expectations, according to LSEG data. While the ebb and flow of fossil-fueled fortunes is nothing new, Ford’s electric-car pivot is printing more red ink than ever.
The company was on track to hit its full-year profit guidance before strikes idled factories, racking up $1.3 billion in costs and forcing boss Jim Farley to nix that forecast. Other plans are jettisoned, too: Ford has delayed electric-vehicle production targets and cut workers’ shifts for its F-150 Lightning, a battery-powered pick-up truck hailed as traditional carmakers’ silver bullet. That truck’s sales fell 46% year-over-year in the third quarter, Cox Automotive reckons.
Electric-vehicle growth is slowing everywhere, even at titan Tesla (TSLA.O). But Ford is trying to scale to profitable sales and right now, things are going the wrong way. The company’s electric division recorded a nearly $37,000 operating loss per battery-powered ride sold this quarter, 51% worse than last year. Electric pick-up startup Rivian Automotive (RIVN.O), without Ford’s century-plus of car-making know-how, cut its gross losses per car by roughly half for two quarters in a row. With once sky-high electric prices now free-falling, Ford faces the brass-tacks problem of simply grinding down costs.(By Jonathan Guilford)
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