Ford’s EV Battle

By Douglas A. McIntyre Published Oct 11, 10:15AM EDT

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The federal government will start to give electric vehicle (EV) buyers as much as $7,500 to make a purchase. They used to have to wait until they filed their taxes. This makes it more attractive to buy an EV. For Ford, still primarily a gasoline-powered car manufacturer, the news puts it at a disadvantage.
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According to “The Wall Street Journal, Starting in January, EV buyers get up to $7,500 off the purchase right at the dealership, rather than wait months until filing their tax return to get the credit, the Internal Revenue Service said Friday.” EV sales at Ford are such a small fraction of sales that buyers will be unable to use that credit on well over 90% of its vehicles.
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Ford sold 156,614 vehicles last month. It sold 3,454 Mustang Mach-Es and 1,918 Ford F-150 Lightnings, the Ford EV flagship. Ford will produce hundreds of thousands of EV units less than expected this year. It has said that some of this relates to demand. (See the 15 most fuel-efficient trucks.)

Among the questions about Ford’s future is how many EVs it will sell once it ramps up their production. It may be that many people prefer gasoline-powered cars for years. Ford has staked its future on the idea that the demand for EVs will quickly skyrocket into the millions in the United States.
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Why single out Ford as a victim of the new tax method? Because it has blown the trumpet more than any other car company about the importance of EV sales and how it will fulfill demand.

Observers may believe that the current UAW strike and its effect on the cost of EV production are Ford’s challenges. Likely, that is untrue. Other forces could be a bigger problem.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.