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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.

Lincoln plans pilot subscription service for pre-owned vehicles

Lincoln's foray into the world of monthly subscriptions will follow the mold of Ford's Canvas program and launch a pilot service offering a range of pre-owned 2017 Lincoln vehicles in West Los Angeles and the San Francisco area. Lincoln first announced plans for a subscription service on the sidelines of the L.A. Auto Show. The luxury automaker says its new service will allow customers to have a vehicle "as if it were their own," with a monthly payment that covers a prescribed mileage package and includes comprehensive insurance, warranty, maintenance and roadside assistance. It'll be based on Ford's nearly year-old Canvas program, also offered in the Bay Area and West Los Angeles. It offers pre-owned Ford vehicles on a monthly subscription basis, including insurance, maintenance and warranty coverage. Terms for that program are one to 12 months, with an ability to swap cars at any time. While Lincoln didn't announced pricing or a start date for its own subscription program, Canvas' existing service starts at $400 a month, not including tax and depending on vehicle and other options, for pre-owned Ford vehicles. Ford in February said its Canvas fleet has more than 600 customers who've logged more than 3 million miles in the two markets. Lincoln joins a growing list of automakers including Volvo, Cadillac and Porsche who are offering monthly subscription services as an alternative to traditional ownership or leasing. The subscription service will also come with Lincoln's Pickup & Delivery program, in which a valet picks up a customer's vehicle for service at any location and provides them with a loaner Lincoln before returning their vehicle. Lincoln also reiterated its plans to expand its Lincoln Personal Driver service first piloted in San Diego and Miami to Dallas, saying it will soon be integrated into the Lincoln Way mobile app. The service, previously called Lincoln Chauffeur, allows customers to call on a screened personal driver who can also assist with errands while the customers attend to other matters. The luxury brand is emphasizing "warm, human and effortless" services as a way to differentiate itself from its competitors. For more information on Vehicle Subscription Services, check out the Complete Guide. Related Video:

Weekly Recap: Lincoln Continental serves up the style, Cadillac CT6 delivers the substance in New York

Lincoln and Cadillac grabbed the spotlight this week at the New York Auto Show in a dramatic fashion that evoked the brands' glory days. America's two luxury carmakers went toe-to-toe with their glittering reveals and plans for ambitious expansion. Both were selling their technology, style and the promise of a better future. Cadillac vs. Lincoln. At the Javits Center, 2015 seemed a lot like 1956. Neither company was interested in drawing comparisons with the other, which is fair, and accurate. They're in vastly different places in terms of sales and the pace of their turnarounds, but they hope to reach the same eventual destination at the pinnacle of the luxury-car world. Lincoln used the element of surprise to great effect with the Continental concept. A production version is still at least a year away, and the company was vague on details. Officially, we don't even know if it is front- or rear-wheel drive, though speculation abounds. Who cares? The seats can be adjusted 30 ways! The Continental also showed off a bold chrome grille that will be the new face of Lincoln. The blue bomber also rolled on blinged-out 21-inch polished aluminum wheels, used a 3.0-liter EcoBoost engine and had huge LED head lights with "laser-assisted" high beams. All of this resulted in almost blinding attention. The concept drew rave reviews, stirred controversy with Bentley designers who argued Lincoln ripped them off, and most importantly, pointed a way forward for the newly determined brand that hopes to compete with Mercedes, BMW, Audi, Cadillac and Lexus. View 32 Photos Meanwhile, Cadillac showed the CT6, a finished product that will top its range and is loaded with the best and latest technologies General Motors has at its disposal. With production starting late this year, Cadillac had more specifics at the ready. Engines? Cadillac has a couple V6s and a turbo four for sure. It's working on a hybrid, and has considered a V-Series variant. It's based on a new rear-wheel-drive, aluminum-intensive chassis called Omega, features an advanced collision-mitigation system with automatic braking and has a cabin that's laden with "leathers, exotic woods and carbon fiber." It will be assembled at GM's Detroit-Hamtramck factory and goes on sale next year. At this point, Cadillac is more than willing to talk about every except for the price. The devil was not in the details for Cadillac, as evidenced by the CT6. But it wasn't for Lincoln either.