Connect with us

Hi, what are you looking for?

Ford Explorer EV
Photo courtesy of Ford


Ford Vows EV Price Competition While Cupra Ponders US Sales

Ford says it plans to bring the heat in its battle for EV dominance with Tesla while Cupra is said to be eyeing the US market.

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

Last week, Ford held a “teach in” for Wall Street in an effort to educate analysts about how the separation of the company into three components — Ford Blue for vehicles with internal combustion engines, Ford Pro for commercial vehicles and other services, and Model E for all-electric vehicles — will impact the company’s share price.

As part of that presentation, Ford CEO Jim Farley let it be known that while Model E booked losses of $2.1 billion last year, that part of the business should be viewed by investors as a startup like Tesla, Rivian, or Polestar. He added that the company expects the Model E losses to be around $3 billion in 2023 but expects the Ford Model E business to become profitable by 2026 with an 8% operating margin.

By comparison, Tesla’s operating margin in 2022 was 16.8 percent and in 2021 it was 12.1 percent. Farley thinks those numbers will shrink as more competitors bring electric cars to market. “Tesla hasn’t had any competition until Ford and others came along,” Farley told Yahoo Finance Live on Friday. “Now their prices are down like $7,000 in one year, so there’s going to be more price competition in that market, and we’re counting on that.” CFO John Lawler told Yahoo Finance that Ford will offset $7 billion in costs from its legacy auto business to help pay for its EV ambitions and bolster overall profit margins.

The message from Ford seemed to find a favorable audience among the Wall Street participants, who appreciated the company’s efforts to increased transparency. But they also said that Ford must reach its profitability goals in order for the stock price to move higher in the future.

“While this is clearly a momentous occasion for Ford as a company, we believe today is largely a non-event for the stock,” EvercoreISI analyst Chris McNally wrote in a note. “We believe the key for Ford’s stock, from here, is to drive market confidence in the guided $6-8Bn swing in EV profitability expected between ’23 and ‘26/27. Similar to GM, we see Ford’s stock as range bound (between $10 and $14) while all OEMs deal with a “normalizing” incentive market over the next 12–24 months.”

Ford Project T3

Photo courtesy of Ford.

For its part, Ford is doing everything in its power to move its contribution to the EV revolution along. Its new factory in western Tennessee is coming along nicely and expected to begin producing a next-generation electric pickup truck — codenamed Project T3 — in 2025. “BlueOval City is the blueprint for Ford’s electric future around the world,” said Bill Ford, Ford’s executive chair. “We will build revolutionary electric vehicles at an advanced manufacturing site that works in harmony with the planet, aligning business growth and innovation with environmental progress.”

“Project T3 is a once in a lifetime opportunity to revolutionize America’s truck. We are melding 100 years of Ford truck know-how with world-class electric vehicle, software and aerodynamics talent. It will be a platform for endless innovation and capability,” said Jim Farley.

“PJ O’Rourke once described American pickups as ‘a back porch with an engine attached.’ Well, this new truck is going to be like the Millennium Falcon – with a back porch attached. The manufacturing process will be equally breakthrough, with radical simplicity, cost efficiency and quality technology that will make BlueOval City the modern day equivalent of Henry Ford’s Rouge factory — a factory of the future that people from all over the world will want to tour,” he added. The factory has a planned capacity of 500,000 electric trucks a year.

Ford has also recently announced the introduction of an electric Explorer for the European market that is a slimmer, trimmer version of the Explorer sold in America. It is the first of two new vehicles from Ford Model E to be based on the Volkswagen MEB battery-electric platform.

Cupra Coming Stateside?

SEAT EV Clelebratin

Courtesy of Cupra

SEAT is part of Volkswagen Group and Cupra has traditionally been the performance division of SEAT. Neither SEAT nor Cupra have ever sold cars in America, but that may be about to change. At the Cupra annual press conference this week (video here), SEAT and Cupra CEO Wayne Griffiths said, “As far as our ambition of being truly global, we are currently analyzing a possible entry into the North American market. At the moment, we are testing our brand with potential clients; we think Americans would love Cupra’s design and great performance.”

He added that the results of those tests are very promising, but in a recent interview with Autocar, he acknowledged that Cupra needs larger battery electric models if it wants to enter the US market and be successful. “You need a car in the US that’s fit for the US and electric. A US electric car is generally bigger, so it will be a next generation of electric cars that would be based on the SSP platform from VW.”

He noted that the investments for making cars ready for America are “considerable,” adding that Cupra needs to be stronger first in Europe before embarking on a US expansion. Since the Scalable Systems Platform has been delayed to around 2028, it seems unlikely Cupra will be coming to America much before the end of this decade. There is also a strong possibility that other brands within Volkswagen Group are also thinking of bringing SSP-based models to America.

Griffiths said the timing of a US market launch would be linked to Cupra becoming an electric-only brand, which should happen by 2030 according to the company’s projections. But Cupra must first establish itself as a separate and distinct brand in Europe, where is expects to capture three to four percent of the market — up from 1.2 percent today.

The Takeaway

The unspoken subtext to all this is that not only is there an EV revolution going on at this moment; there is also an EV manufacturing revolution going on. It is being driven by the high cost of batteries, which make it next to impossible to produce mass market EVs unless the assembly process itself gets less expensive.

Tesla is the leader in this regard, as it has pushed die casting technology forward, but other companies know a thing or two about making automobiles and are bringing all their knowledge and experience to bear to reduce production costs as well. The upshot is that, by the time battery prices fall substantially, the manufacturing piece of the puzzle will be in place and truly affordable electric cars will be the result.

The struggle for profitability will be painful for most legacy automakers, but the payoff for the companies and the world will be worth the struggle. We can’t wait to see where the marketplace will be like by the time 2030 rolls around.

Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

EV Obsession Daily!

I don't like paywalls. You don't like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it!! So, we've decided to completely nix paywalls here at CleanTechnica. But...
Like other media companies, we need reader support! If you support us, please chip in a bit monthly to help our team write, edit, and publish 15 cleantech stories a day!
Thank you!

Tesla Sales in 2023, 2024, and 2030

CleanTechnica uses affiliate links. See our policy here.
Written By

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."


You May Also Like


Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News! September saw plugin EVs take 63.4% share in...

Clean Power

There are about 200 GW of HVDC cables stretching 58,000 kilometers in operation today, and about 180 GW planned stretching about 45,000 kilometers in...

Clean Power

New automation technology gives an edge to green hydrogen as blue hydrogen stakeholders struggle to make their case.


Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News! September saw plugin EVs take a record 29.3%...

Copyright © 2023 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.