The Real Reason Why Ford Delayed EV Development

Ford Group delays electric vehicle transition
Announces focus on technology development

The global automobile industry is entering the era of electric vehicles. In line with this trend, global brands have announced plans to switch from internal combustion engine vehicles to electric vehicles and are implementing them. However, unlike other brands, one brand has decided to delay its plan to switch to electric vehicles for the time being. It is Ford, America’s representative automobile brand.

Ford, or more precisely, all brands belonging to the Ford Group, are expected to delay their electric vehicle conversion plans. They also previously announced plans to switch to electric vehicles. However, according to recent news, the goal has been revised to maintain the production of internal combustion engine vehicles for the time being and focus on developing cutting-edge features to strengthen the vehicle’s attraction.

Ford Group mentioned the past electric vehicle transition plan

Ford Group announced in 2022 that it would produce more than 2 million electric vehicles annually by 2026. In addition, the Ford Group announced that it has secured enough batteries to produce 600,000 electric vehicles per year by the end of 2023 and 70% of the batteries needed for the 2026 goal. In April 2022, the star concept car was unveiled through the Lincoln brand, and the automaker showed an active stance toward converting to electric vehicles.

Ford Group only sells the Ford Mustang Mach E and F-150 Lightning. Other than these two models, there are no separately sold electric vehicle models, and in the case of the Lincoln brand, no electric vehicle models have been released on the market since the Star Concept Car. The only recent news related to the Lincoln brand electric vehicle is the plan to develop an entry-level electric vehicle priced at $25,000 in February 2024.

Slow transition to electric vehicles and focus on technology

Ultimately, Ford Group revised its plan to delay the transition to electric vehicles. Ford Group then explained that it will concentrate on strengthening product value by focusing on the development of technologies installed in vehicles while maintaining the internal combustion engine powertrain currently in production for the time being.

With Ford Group’s announcement, the American media is concerned that they will fall behind in the market. GM (General Motors), a strong competitor to Ford Group, unveiled the Equinox EV and Silverado EV models through the Chevrolet brand and the Celestiq and Lyriq models through the Cadillac brand. As such, General Motors has been showing very active steps toward converting to electric vehicles.

Tesla contributes to the reason for EV transition delay

There is a reason why Ford Group has been delaying the transition to electric vehicles. Currently, the growth of the global electric vehicle market has been slowing. So far, the electric vehicle market has been growing rapidly by about 50-60% every year. However, in 2023, the growth rate decreased to 33%, and in 2024, due to uncertain factors related to the slowdown in demand, the growth rate is expected to decrease significantly to 20%.

In addition, Tesla, a leader in the global electric vehicle industry, is triggering discount competition, putting a heavy burden on electric vehicle companies’ performance. Purchase demand for electric vehicle models, excluding Tesla vehicles, is significantly lower than expected. In response, Ford drastically reduced F150 Lightning production from 3,200 to 1,600 units per week and reduced the shift system at the Rouge Electric Vehicle Center in Michigan, US, from 3 shifts to 1 shift.