Is Ford losing money on every EV sold?
No — Ford does not state that it loses money on every electric vehicle. The company has reported losses within its BEV (battery electric vehicle) operations in recent years, but it also emphasizes that profitability should improve as it scales production, reduces battery costs, and increasingly monetizes software and services. The reality is a mixed picture: some models are closer to break-even or modestly profitable, while others contribute to BEV losses as Ford invests for future volume.
To understand the question, it helps to examine how automakers measure EV profitability, what Ford has publicly disclosed about its BEV finances, and the factors that will determine whether Ford ever sells BEVs at a profit per unit. This article dives into current publicly available information and the broader context of EV economics in the auto industry.
Where Ford stands today
Ford organizes its electric vehicles under the Model e division, which houses BEV development, production, and software. The company has repeatedly said that BEVs are capital-intensive and that profitability will come with scale, battery cost reductions, and higher-margin software services. As of the 2023–2024 period, Ford’s BEV unit had reported losses on an EBIT or gross basis, while the overall company continued to generate profit from ICE vehicles and other businesses. Ford’s messaging has focused on a path to BEV profitability by the middle of the decade, contingent on volume growth and cost declines.
Current BEV profitability status
Industry and investor communications indicate that Ford’s BEV products have not consistently delivered positive margins in every quarter or on every model. The company has noted that the economics of BEVs improve with greater scale, more efficient battery supply, and stronger software monetization. While some Ford BEVs may approach break-even at certain price points or with favorable subsidy structures, the BEV unit as a whole has faced ongoing challenges typical of early-stage, high-capital EV programs in the auto sector.
Key factors shaping Ford’s BEV profitability include the cost of batteries, the capital cost of production facilities, the amortization of research and development, software and services revenue, and regulatory incentives that affect consumer pricing. The company argues that as these factors move in the right direction, BEV margins should improve.
Another important context is the broader market environment: battery prices have fluctuated, supply chains have matured, and government incentives—such as those in the Inflation Reduction Act era—have influenced both vehicle pricing and consumer demand. Ford has emphasized that achieving sustained BEV profitability is a multi-year process tied to scale and cost optimization.
In short, Ford is not declaring an across-the-board loss on every EV sold; rather, it acknowledges BEV losses to date and outlines a roadmap toward profitability as volumes rise and costs decline.
What drives EV profitability at Ford
The economics of Ford’s EVs hinge on several interrelated factors. Below is a breakdown of the principal drivers shaping whether Ford can turn BEVs into a profitable business over time.
Key factors shaping BEV profitability for Ford
- Battery cost and energy density: A large share of BEV cost is tied to the battery, so reductions in cell cost and improvements in energy density directly affect margins.
- Scale and production efficiency: Higher vehicle volumes reduce per-unit manufacturing costs and enable better utilization of specialized BEV plants and battery supply lines.
- Supply agreements and inflation: Long-term battery contracts and supplier pricing influence per-vehicle cost, as do currency fluctuations for components sourced globally.
- Vehicle pricing and demand: Competitive pricing, average transaction prices, and demand mix determine gross margin per unit and overall BEV contribution.
- Software and services: In-vehicle software, subscriptions, and connected services can lift margin through recurring revenue streams beyond the one-time vehicle sale.
- Warranty, maintenance, and durability: BEVs have different maintenance profiles, and repair costs can impact long-term profitability per vehicle.
- Capital expenditure and depreciation: Investments in production facilities, tooling, and battery plants must be amortized over many years, affecting near-term profitability metrics.
- Regulatory incentives: Tax credits and subsidies can improve the effective price for customers and, in some cases, augment margins.
- Aftermarket ecosystem and charging network: Networks and partnerships can influence vehicle appeal and total cost of ownership, indirectly affecting profitability.
Concluding paragraph: While individual Ford BEV models may vary in margin from quarter to quarter, the aggregate BEV business hinges on achieving scale, reducing battery and capital costs, and successfully monetizing software services. Those conditions are the path Ford has publicly mapped out for achieving profitability within the Model e division.
Ford’s profitability timeline and targets
Ford has described a multi-year plan to reach BEV profitability, emphasizing scale, cost reductions, and software-driven revenue. The company has indicated that BEV gross margins and unit profits should improve through the mid-2020s as battery costs decline and volumes rise. While precise annual targets are periodically updated during earnings calls, the overarching message is that BEV profitability is expected to arrive as a result of sustained investment, efficiency gains, and pricing discipline.
- Improve BEV gross margins through cost reduction and pricing discipline as volumes increase and battery technology becomes cheaper.
- Achieve meaningful BEV contribution margins by building scale and leveraging long-term battery contracts and vertical integration where feasible.
- Strengthen software and services revenue to augment per-vehicle profitability beyond the sale price of the car.
- Reach BEV profitability within the middle of the decade, aligning with the company’s strategic roadmap for Model e and its product lineup.
- Balance BEV growth with overall corporate profitability, leveraging ICE operations and cross-brand efficiency improvements.
Concluding paragraph: The forecast is conditional on market demand, battery supply stability, and the pace of price reductions in both components and vehicles. Ford maintains that the trajectory toward BEV profitability is underway, driven by scale, cost discipline, and an expanding software ecosystem.
Model-by-model outlook and what investors watch
Industry observers and investors pay close attention to how specific Ford EVs perform, both in terms of unit sales and margins. The Mustang Mach-E, F-150 Lightning, and E-Transit each have distinct cost structures, battery configurations, and software features that influence profitability. While some models may produce tighter margins—or even modest losses—into early-stage ramp periods, the expectation is that longer-run profitability will be tied to higher volumes, improved battery economics, and stronger software monetization across the portfolio.
Summary
Ford’s stance on EV profitability is nuanced rather than absolute. The company has acknowledged BEV losses to date while outlining a path to profitability through scale, battery-cost reductions, and expanded software revenue. Rather than a blanket statement that Ford loses money on every EV, the situation reflects the broader transition era in the auto industry, where automakers invest heavily in BEV platforms today with the goal of profitability in the years ahead as technology matures and volumes grow. For readers tracking the story, the key indicators will be BEV gross margins, Model e contribution margins, and the pace at which battery and software costs come down and revenue from services grows.
Did Ford lose money on every EV?
As I noted in February, Ford lost $52,113 for each EV it sold in 2024. While the per-vehicle losses in the first quarter were an improvement over last year's numbers, the EV business has been nothing short of disastrous for the Dearborn-based auto giant. In 2022, Ford lost $2.2 billion on EVs.
Is Ford having trouble selling electric vehicles?
In October, Ford's overall U.S. EV sales fell 24% from the prior year. A 2023 study by the Texas Public Policy Foundation suggested that EVs would cost almost $50,000 more to own over ten years than internal combustion vehicles if not for subsidies, regulations, and other hidden costs.
Are car makers losing money on EVs?
Most Automakers Lose Money on EVs.
Why is Ford discontinuing electric vehicles?
Ford is considering discontinuing the electric F-150 Lightning due to low demand and $13 billion in total EV losses since 2023. Ford's U.S. EV sales dropped 24% year-over-year in October, with only 1,500 Lightnings sold compared with 66,000 gas F-Series pickups.
