(May 13, 2024) Ford has begun cutting orders from battery suppliers to stem growing electric vehicle losses, according to people familiar with the matter, as it throttles back ambitions in a rapidly decelerating market for plug-in models, according to Bloomberg News. Ford said EV losses exceeded $100,000 per vehicle in the first quarter of 2024.

In November, Ford said the EV battery factory it plans in Marshall, Mich., will be substantially smaller than originally planned, in part because EV adoption is not growing at the pace the automaker and industry anticipated. Suppliers such as like battery maker Our Next Energy are feeling the pinch as the auto industry slows its EV transition.

The move is part of a retrenchment of Ford’s EV strategy, which includes reducing spending by $12 billion on battery-powered models, delaying new EVs, cutting prices, and postponing and shrinking planned battery plants. Ford has forecast EV losses of up to $5.5 billion this year and CEO Jim Farley recently said its EV unit, Model e, “is the main drag on the whole company right now.”

Ford continues to maintain partnerships with its battery suppliers, which include South Korea’s SK On Co. and LG Energy Solution Ltd., as well as China’s Contemporary Amperex Technology Co. Ltd., said the people, who asked not to be identified revealing internal decisions.

Source: Bloomberg News