Ford climbs on EREV wagon
Ford Motor Company is rethinking its electric vehicle strategy yet again.
Faced with losses from its EV division of as much as $5.5 billion this year, Ford is reducing the allocation of capital expenditure on EVs from 40% to 30% and focusing more on hybrid technologies and other “electrified propulsion options”.
Ford is cancelling plans for a large fully electric SUV, replacing the three-row BEV with an extended range vehicle, or EREV, and is postponing the launch of a next-generation pickup to the second half of 2027. The first of its next-generation EVs is now scheduled to be a commercial van with production starting in 2026.
Ford is also moving some battery production for its Mustang Mach-E from Poland to the US and confirmed output of LFP batteries at its Michigan plant will start in 2026.
In November the company cut the BlueOval Battery Park (a partnership with CATL) from a 35 GWh down to 20 GWh per year facility. Production of the fully electric Ford Explorer in Europe kicked off in June after being delayed to accommodate a shift from NCM to LFP batteries supplied by CATL.
Dearborn’s recalibration of its North American business comes during a good trading spell for the company in the region.
After a sluggish start at launch, sales of the F-150 Lightning pickup, the gasoline counterpart of which has been the top seller in the US for decades, took off this year.
Together with its popular Mustang Mach-E and E-Transit, the best-selling van in the US, just over 50% more electrified Fords found buyers in the Americas from January through June this year compared to 2023.
In the Americas, of which the US and Canada comprise 93% of the market, passenger EV registrations were up 27% year on year over the same period (including plug-in and conventional hybrids) meaning Ford significantly outperformed the market.
On a combined battery capacity deployed basis, Ford’s performance stands out even more with 71% year over year growth. Ford buyers in H1 2024 rolled 5.6 GWh of fresh battery power onto roads in the Americas, placing Ford at number three with a 9% share of the regional market.
With 6.4 GWh deployed, Hyundai topped Ford’s growth, claiming no 2 in the region, but still remained miles behind leader Tesla, despite its deployment falling 9% below H1 2023’s 27.1 GWh. Volkswagen’s deployment in the Americas also shrunk, down 4%, falling back below 3.0 GWh level.
Notably, BYD expanded at the fastest rate among the top 10 with a near 7-fold increase in the Americas to 1.7 GWh, almost all of which was deployed onto roads in Brazil, now the third largest EV market in the Americas after overtaking Mexico during H1.
Adamas take:
Ford’s sharper focus on hybrids, particularly EREVs, is perhaps overdue.
EREVs, where the internal combustion engine never powers the wheels but acts as a generator for the battery, have surged in popularity, particularly in China. EREVs now make up 44% of the plug-in hybrid market in China on a GWh installed basis.
The combined battery capacity of EREVs sold in China during the first six months of this year climbed by 124% year-on-year and at 20.0 GWh, now represents just over 10% of the overall market inside the country.
PHEVs make sense given the travelling distances, lack of adequate charging infrastructure and relatively cheap gas in the US and parts of Canada.
More importantly to Ford, perhaps, is that Stellantis will begin deliveries of a fierce competitor to the F-150 Lightning before the end of the year. Tellingly, the 2025 Ram 1500 Ramcharger is an EREV.
