Slower-than-expected growth in electric vehicle sales has forced several automakers to scale back once-ambitious production plans. Ford Motor has become the latest company to join this pushback.
In a memo sent to suppliers, the company said it now plans to produce an average of 1,600 F-150 Lightning electric pickup trucks per week in 2024, about half the level it had previously hoped to achieve.
The reduced target reflects the substantial drop in sales expectations for battery-powered cars and trucks that automakers now face. Ford and its main rival, General Motors, have rushed to increase production of a variety of electric vehicles, but consumer enthusiasm has not kept pace with those plans over the past six months. Some potential buyers have been put off by the high prices of many electric vehicles, including the F-150 Lightning, as well as the availability and reliability of charging stations.
GM once expected to produce 400,000 electric vehicles by mid-2024, but with that target in November, and delaying some new electric models. Rivian, a young automaker, said it aims to make 52,000 electric vehicles by the end of this year, or a third of the 150,000 annual vehicles it hopes to eventually produce at its Illinois factory. .
Similarly, Ford hoped to have the capacity to make 600,000 battery-powered vehicles per year by the end of next year. As recently as September, Ford announced its goal of being able to make 150,000 electric F-150s per year, or a rate of about 3,000 vehicles per week. It also scaled back production plans for its electric sport utility vehicle, the Mustang Mach-E.
“Given the dynamic environment for electric vehicles, we are being judicious about our production and adjusting our future capacity to better meet market demand,” Ford Chief Financial Officer John Lawler said last month during ‘a conference call with financial analysts.
News of Ford’s memo to suppliers was reported earlier by Automotive News.
Even with a reduced target, Ford still expects Lightning production and sales in 2024 to easily exceed 2023 levels, a statement said. In the first 11 months of this year, Ford sold more than 20,000 trucks, an increase of more than 50% compared to the same period in 2022. Sales of all of the company’s electric models increased by 16%, to reach more than 62,000 vehicles.
Encouraged by Tesla and its rapid growth in sales and profits, traditional automakers have spent tens of billions of dollars developing a range of electric models and equipping factories to produce them and their batteries.
But even Tesla has seen slower sales growth this year. This forced the company to repeatedly cut prices on its two most popular models, significantly reducing its profit margin.
Other companies are postponing plans for new models. Last month, GM announced it would delay electric versions of its Chevrolet Silverado and GMC Sierra pickup trucks, as well as the Chevrolet Equinox sport utility vehicle. Honda once planned to develop a small electric car with GM, but abandoned the effort this year.
Ford has four battery factories under construction in the United States, but recently announced it would reduce the size of one of them, in Michigan.
At first, automakers expected customers to flock to electric cars and trucks. By the end of 2021, Ford had accepted reservations for more than 200,000 F-150 Lightnings.
But early interest didn’t always result in booming sales. Cost is a big complaint. Battery prices remain high, making some electric vehicles much more expensive than comparable gas-powered models at a time when consumers are grappling with inflation.
When it introduced the Lightning, Ford announced that the truck would start at $40,000, but the company raised prices shortly afterward, disappointing many people who had reserved the truck. The pickup now starts at $50,000 and the top-of-the-line version starts at $92,000.
Additionally, it can also be difficult to find enough places to charge electric cars and trucks in many parts of the country, disrupting some car buyers, especially those without a garage or driveway. where to install a personal charger. Some drivers also complain about long queues at public charging stations or that some machines are broken or take too long to charge their vehicles.
“We’re going to meet the demand,” Mary T. Barra, GM’s chief executive, said during a conference call in November. “We’re going to make sure we have the right products at the right time, but we’re not overbuilding.”
