(AmericanProsperity.com) – Ford Motors has said that the path to profitability is with electric vehicles. This shift is surprising for the automaker, which had originally focused on large trucks and SUVs.
Marin Gjaja, Ford’s Chief Operating Officer for its Model EV unit spoke out about the company’s thoughts on electric vehicles. Gjaja said that this new plan is an “insurance policy” for the company to be able to expand their hybrid models and create affordable electric vehicles. They hope they will have a more profitable electric vehicle business that’ll be good for investors.
“We’re quite convinced that the highest adoption rates for electric vehicles will be in the affordable segment on the lower size-end of the range,” he said. “We have to play there in order to compete with the entrants that are coming.”
The automaker revealed that their EV strategy would cost up to almost two billion dollars. This would include four hundred million for the write-down manufacturing and then additional expenses of up to one and a half billion dollars.
Ford’s plans included a large three row SUV or a large pickup truck, but it’s expected that a commercial van will serve as the company’s first new EV. Gjaja said that the decision to cancel the three row vehicle was not taken lightly.
“We believe smaller, more affordable vehicles are the way to go for EV in volume. Why? Because the math is completely different than internal combustion engine vehicles,” Ford CEO Jim Farley said.
Farley said that the issue comes with the weight and cost of batteries that are needed to power these larger electric vehicles. It causes a limitation when creating electric vehicles due to ranges and charging networks.
Copyright 2024, AmericanProsperity.com
