Electric Vehicles Cause Ford to Experience $4.5 Billion Drop in Profits

On Wednesday, the Biden administration plans to introduce new rules requiring 67 percent of all vehicle purchases to be electric vehicles (EVs) by 2032.

Under the new regulations, car manufacturers must reduce the emissions of their vehicle fleets. Currently, electric cars account for only 5.8 percent of all vehicle sales in the US.

Biden’s aim is to phase out internal combustion engines and promote the use of electric batteries by 2027 through government pressure.

The Biden administration seeks to bring about a drastic change in American society by advocating for electric vehicles and making it more challenging to own a gasoline-powered car.  

It is uncertain whether auto companies can achieve the regulatory targets since the White House is rapidly pushing for increased electric car adoption among the American public.

The sudden increase in electric vehicles under the Biden administration has put a strain on public charging infrastructure and battery supply, causing a 40 percent surge in demand for these essential components. 

China is the primary source of materials required for electric vehicle battery production. In 2022, China had control over approximately 75% of battery cell manufacturing capacity, as well as 90% of battery anode and electrolyte production.

Ford Motors made significant investments in electric vehicles, while Biden opposed internal combustion engines. 

However, this investment has proven to be disastrous for Ford, as the company reported a $3 billion loss in electric vehicle profits. Ford’s second-quarter financial results project total losses of over $4.5 billion in 2023. 

The electric car division of the company, known as “Ford Model E,” has accumulated losses of over $1.8 billion, following losses of over $2.1 billion in 2022. 

Despite these setbacks, Ford has still accepted subsidies from the Biden administration for its electric vehicles. As a result, Ford recently announced layoffs of over 1,000 employees in the United States and Canada to focus on producing more electric cars.

This article appeared in The Record Daily and has been published here with permission.

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Written by Western Reader

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