Ford Motor Co.'s (NYSE:F) EV segment continued to be bogged down by industrywide pricing pressure during the third quarter when it recorded a loss of $1.2 billion in EBIT.
What Happened: For the third quarter, Ford's EV segment called "Model e" reported an EBIT loss of $1.2 billion after cost improvements were offset by industrywide pricing pressure, taking its loss this year through the end of September to $3.7 billion. The company now expects a full-year EBIT loss of $5 billion from the segment.
EBIT refers to earnings before interest and taxes.
"No doubt there's a global price war and it's fueled by overcapacity, a flood of new EV nameplates, and massive compliance pressure," Farley said on Monday about the EV landscape.
The growth in EV sales volume continues to be offset by prices, the CEO said, while adding that the company now expects around 150 new EV nameplates to hit North America by the end of 2026
"...some of our competitors are already resorting to very aggressive lease tactics even on their brand-new products, which creates huge residual risk and overhang and brand damage," Farley said. He added that the company is looking to bring down costs to deal with the market dynamics, including in making its Mustang Mach-E SUV.
The company also has a "skunkworks" team in California working on a low-cost EV platform to compete against Chinese EV manufacturers like BYD Co. known for their low-priced EV offerings, the CEO added.
Why It Matters: In August, Ford said that it is killing its plans to build a three-row electric SUV, initially slated for production in 2025. The company also postponed its plans for a new electric version of its F-150 pickup to 2027 and said it will start making a new electric commercial van in 2026.
More details on the company's EV strategy are now expected in the first half of 2025.
The company currently sells three EV models in the U.S., including an SUV, a van, and a pickup truck. The company sold 23,509 EVs in the last quarter in the U.S., less than Tesla and also General Motors who spurred EV sales with new EV offerings.
Price Action: Ford's shares fell 6.6% in premarket trading on Tuesday after closing at $11.37 on Monday. Year-to-date, the automaker's shares are down 6.5%, according to Benzinga Pro data.
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