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Ford Model e losing billions as it says EV unit should be seen as startup

DETROIT — Ford Motor Co.'s electric vehicle business has lost $3 billion before taxes during the past two years and will lose a similar amount this year as the company invests heavily in the new technology. The figures were released Thursday as Ford rolled out a new way of reporting financial results. The new business structure separates electric vehicles, the profitable internal combustion and commercial vehicle operations into three operating units. Company officials said the electric vehicle unit, called “Ford Model e,” will be profitable before taxes by late 2026 with an 8% pretax profit margin. But they wouldn't say exactly when it's expected to start making money. Chief Financial Officer John Lawler said Model e should be viewed as a startup company within Ford. “As everyone knows, EV startups lose money while they invest in capability, develop knowledge, build (sales) volume and gain (market) share,” he said. Model e, he said, is working on second- and even third-generation electric vehicles. It currently offers three EVs for sale in the U.S.: the Mustang Mach E SUV, the F-150 Lightning pickup and an electric Transit commercial van. The new corporate reporting system, Lawler said, is designed to give investors more transparency than the old system of reporting results by geographic regions. The automaker calculated earnings for each of the three units during the past two calendar years. Model e had pretax losses of $900 million in 2021 and $2.1 billion last year, and it is expected to lose $3 billion this year. In the past two years Ford has announced it would build four new battery factories and a new vehicle assembly plant as well as spending heavily to acquire raw materials to build electric vehicles. By the end of this year, the company based in Dearborn, Michigan, expects to be building electric vehicles at a rate of 600,000 per year, reaching a rate of 2 million per year by the end of 2026. Ford Blue, the unit that sells internal combustion and gas-electric hybrid vehicles, made just over $10 billion before taxes during the last two years. Ford Pro, the commercial vehicle unit, made $5.9 billion during those years, the company said. For this year, Ford expects Ford Blue to post a $7 billion pretax profit, modestly better than last year. Ford Pro is expected to earn $6 billion before taxes, nearly double its earnings last year, Lawler said. Ford was to present the new structure, announced last March, to analysts and investors on Thursday.

Recharge Wrap-up: Custom Nissan Leaf video, Shell's Arctic oil plans

A video shows a customized Nissan Leaf. An owner in Japan slapped a pretty spiffy body kit on his EV, along with some Forgiato custom wheels and brakes. There's no telling what effects these modifications have on the car's aerodynamics or driving range, but it definitely gives the leaf a unique and sporty look. Check it out in the video above, and read more at Ecomento. Shell has big plans to drill for oil in the Arctic Ocean. With 13 percent of the world's undiscovered oil resting beneath those frigid waters, the company sees this new frontier as promising, despite the challenges involved in exploiting it. So far, Shell has spent $7 billion on Arctic operations without having extracted any oil yet. Of course, the idea of Arctic drilling has loads of opposition from concerned individual and organizations concerned with the environmental hazards of extracting oil in the icy north. Read in-depth about Shell's plans at Bloomberg. Ford has won the Altair Enlighten Award for its lightweight technology in the F-150. The award program honors automotive innovations in weight reduction. Ford was recognized for shaving 700 pounds off of the F-150 while improving performance and safety. "It's encouraging to see Ford implementing a holistic lightweighting strategy, which resulted in impressive weight savings that were incredibly significant to the judging panel," says Altair's Vice President of Global Automotive, Dave Mason. General Motors was the runner-up, with its weight savings in the Cadillac ATS and CTS. Read more at PitchEngine. The Diesel Technology Forum has outlined environmental improvements in heavy-duty vehicles at a rulemaking hearing in front of the EPA and NHTSA. Between 2010 and 2014, clean diesel technology reduced carbon emissions equal to that of 2.4 coal-fired power plants, and NOx emissions equal to 158 coal plants. New rules would help further improve the environmental performance of diesel engines. "Advances in diesel engine technology will continue to contribute to the overall efficiency gains of vehicles under this proposed rule," says Diesel Technology Forum Executive Director Allen Schaeffer. "As a result we expect diesel technology to remain the primary power-plant for commercial trucks into the foreseeable future." Read more in the press release below. Clean Diesel Power Key Part of Achieving Future Truck Efficiency Gains, EPA Officials Told -- Diesel Technology Forum CHICAGO, Aug.

Ford earnings take a dive on investment, slowing sales; workers get $6,900 in profit sharing

Ford Motor Company's pre-tax profits for 2014 took a beating, falling to $6.3 billion, a $2.3-billion drop from 2013, while overall revenues fell from $139.4 billion to $135.8 billion. Net income for 2014, meanwhile, plunged 56 percent, from $7.18 billion to $3.19 billion. Yeah, those aren't great numbers. While Ford's figures are largely down across the board, some of the weaker numbers aren't too difficult to explain away. The company launched 24 vehicles across the globe in 2014, including some of its biggest and most important volume models, like the 2015 F-150, as well as iconic offerings like the new Mustang. The result of this is both increased investment as well as a drop in total sales – US market numbers were down 164,000 units compared to 2013. Recall claims and high warranty costs also did a number on the Blue Oval. "2014 was a solid yet challenging year for Ford - with our investments and a record number of new products launched around the world positioning us for strong growth this year and beyond," Ford CEO Mark Fields said in a statement. Ford's 50,180 UAW workers in the United States will receive profit-sharing checks of $6,900. In some markets, Ford's fortunes were impacted by outside factors. Europe, for example, recorded more sales (up 70,000 units) and higher revenues (up $2.2 billion), but still reported a $443-million pre-tax loss. Blame was placed on the crumbling Russian economy, which has suffered from sanctions and slumping oil prices. Despite its troubles last year, the company still seems bullish on 2015. Ford's pre-tax outlook remains unchanged, as the company expects to make anywhere from $8.5 to $9.5 billion on the back of higher revenue from the company's automotive operations. We expect strong growth and improved financial performance in 2015 driven by our investments in new products and capacity," Ford CFO Bob Shanks said of the company's future.