AutoBeta(AutoBeta.net)07/26 Report--

On July 25, Ford released its results for the second quarter of this year. Ford's total revenue in the second quarter of this year was $47.8 billion, up 6.2 per cent from the same period last year, according to financial data. Net profit was $1.8 billion and adjusted earnings before interest and tax were $2.8 billion. It is worth mentioning that although Ford made a profit in the second quarter, it was still below Wall Street's earlier forecast of $3.7 billion. Officials said the main reason for the lower-than-expected performance was the significant increase in warranty costs for older vehicles. There were quality-related problems with models produced in and before 2021, causing warranty costs to rise to $800m in the second quarter, exceeding investors' expectations.

In terms of specific business revenue, Ford's commercial vehicle business segment made a profit of $2.6 billion in the second quarter, up 7 per cent from a year earlier, a profit margin of 15 per cent, revenue of $17 billion and revenue growth of 9 per cent. The fuel vehicle business had revenue of $26.7 billion in the second quarter and operating profit of $1.2 billion in the second quarter.

The electric vehicle business segment is Ford's loss zone, with second-quarter electric vehicle revenue of $1.1 billion and profit before interest and tax of $1.1 billion. Based on the 26000 electric vehicles sold in the second quarter, it is not difficult to calculate that Ford lost $42300 on every electric vehicle sold. Ford's electric vehicle business lost $2.5 billion in the first half of this year, and officials said the loss in the electric car sector was mainly due to falling wholesale sales and price pressure in the industry. Model e electric vehicle business is expected to lose $50 billion to $5.5 billion this year.

Data show: earlier, in order to accelerate the pace of Ford's electric transformation and reverse the situation of depressed sales, Ford split its business into traditional fuel vehicles and electric vehicles. Among them, the fuel vehicle business, called "Ford Blue", focuses on producing traditional fuel engines for sports utility vehicles such as Bronco. The electric car business, known as Ford Model e, is mainly in charge of electric vehicles and digital, and is headed by Jim Farley, president and CEO of Ford Motor Co., but even the adjustment has not reversed the decline of Ford electric horses in the Chinese market.

As the first pure electric model of Ford Electric vehicle Division, Ford Mustang Mach-E is produced by Changan Ford. It will go on sale on April 23, 2021, with a price range of 24.99-369900 yuan. In December 2021, Ford Electric Horse officially began delivery in China. In September 2022, Ford adjusted the channel of electric vehicles, and Ford Electric Mach Technology won the right to operate Mustang Mach-E and renamed "Mustang Mach-E" to "Ford Electric Horse".

With the rise of the domestic price war in 2022, Ford had to carry out a preferential promotion on the model in 2022, and the price reduction at that time ranged from 20000 yuan to 28000 yuan. Unfortunately, the price cut did not lead to an increase in sales. Ford Electric Horse sold 4860 vehicles in 2022 and 2062 in 2023. In August last year, officials announced that in line with Ford's strategic transformation and business adjustment in the Chinese market, the operation of Ford Electric Horse in the Chinese market would be taken over by Changan Ford. But in fact, after being taken over by Changan Ford, Ford electric horse sales still did not improve. The latest sales of Ford electric horses are 181, with a cumulative sales of 571 this year, according to data.

In addition to the sluggish sales of electric cars, the Ford fuel car market is becoming more and more difficult to sell. Figures show that Ford sold 496000 vehicles in China in 2022, down 33.5% from a year earlier. Ford's cumulative sales in China in 2023 were 467000, down 29000 from 2022. With the intensification of domestic competition for new energy vehicles, Ford has also made a series of adjustments in recent years, such as laying off staff to save costs, speeding up electrified transformation and so on. But at present, the electrification pattern of the domestic car market has undergone great changes, and Ford's electrification transformation speed is relatively slow, which also means that the follow-up in the domestic market will face a series of difficulties.

With regard to Ford's fierce market competition in the future, Ford CEO Jim Farley has said that the company will focus on small, high-margin electric models, and stressed the importance of software and subscription services. According to official plans, Ford plans to produce more than 2 million electric vehicles worldwide in 2026, accounting for 50 per cent of electric vehicle sales in 2030. However, in the face of the increasingly competitive smart electric models in the Chinese market, how to speed up the electrification and increase the sales of electric vehicles will also be a great challenge for Ford.

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