According to a number of domestic media citing Bloomberg, people familiar with the matter revealed that Ford Motor has begun to cut orders from battery suppliers to stop the loss growth of electric vehicles. It is reported that Ford's strategic contraction includes: cutting spending on battery models by $12 billion, delaying new electric vehicles, cutting prices, postponing and shrinking planned battery plants.
Ford will continue to maintain partnerships with its battery suppliers, including SK On, LG Energy Solution and CATL, people familiar with the matter said. In response, a Ford spokesperson said the company generally does not comment on relationships or terms with suppliers. CATL said that "the cooperation with Ford is progressing normally", but did not elaborate. SK On and LG said that the contract with Ford is still valid.
Electric vehicle analyst Sawyer Merritt shared the news on the X platform, and Tesla CEO Elon Musk responded: "It's extremely difficult to build a great electric car at a great price." ”
According to media analysis, Ford's decision to reduce orders could ripple further upstream into the supply chain, hitting the prices of critical metals such as lithium, cobalt and nickel, which in turn hindered mining companies' investment decisions on potential new projects. A more serious consequence could lead to the closure of some mines. Earlier, industry analysts said that the current electric vehicle market in the United States is in a certain "unstable state".
Ford CEO Jim Farley recently said that the Model e, Ford's electric vehicle division, "is a major drag on the company right now." One of the people also said that Ford's first-quarter EV loss was more than $100,000 per unit, more than double the loss in the same period last year, as EV prices plummeted and demand slowed. Bloomberg Intelligence estimates that Ford's losses in its electric vehicle division this year are expected to be close to the profits made by its Ford Blue internal combustion engine vehicle division.
Ford's chief financial officer, John Lawler, said in an interview this month that finding a profitable path to electric vehicles is critical to the company's long-term survival. "The Model e has to be self-reliant," he says. "It needs to be profitable, and it has to provide a return on our investment." He also said that Ford remains committed to reducing the cost of electric vehicles and expects the cost of electric vehicles to continue to decline. However, this is largely offset by significant pricing pressures from industry competitors. "But our goal is to reduce costs as much as possible on the Model e this year, all with the goal of achieving a positive margin."