Ford’s EV Plan Is Too Little

By Douglas A. McIntyre Published Oct 1, 6:40AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Ford’s EV Plan Is Too Little — © gopixa / iStock Editorial via Getty Images

24/7 Wall St. Insights

Ford Motor Co. (NYSE: F | F Price Prediction) is offering its new EV owners a home charging station.
Is that what its EV customers really want?
Also: Dividend legends to hold forever.

Ford Motor Co.’s (NYSE: F) position in U.S. electric vehicle (EV) sales ranks third behind Hyundai/Kia and Tesla Inc. (NASDAQ: TSLA). General Motors Co. (NYSE: GM) is gaining and will challenge Ford’s place in the pecking order. Ford’s new sales tactics include offering free home charger installations and special services that match some EV owners’ needs. The effect on potential customers is likely less than modest.

As part of the promise, Ford will give its new EV owners a new charging station called the Charge Station Pro. The charger’s retail price is $1,310. According to CNBC, the offer is only good for the fourth quarter, although it might be extended. It will also cover the cost of the installation in partnership with Qmerit. Additionally, the company will offer a “247 Live Support” service. This includes roadside assistance, which is hardly unique.

Marin Gjaja, chief operating officer for Ford’s Model e EV business, told CNBC, “We’re trying to get people off the fence.” It is a fence, however, that many people do not want to get off of. Ford’s gasoline-powered sales are extremely healthy. Its hybrid sales are robust, but its EV sales are less than modest. Its EVs are expensive. The market is crowded, and Tesla still has about half of the EV market share in the United States.

What Do Ford Customers Want?

In an EV market that experts believe will not grow rapidly until EV prices drop to $25,000, the mid-level Ford Mach-E has a manufacturer’s suggested retail price of $43,995. This does not include destination fees and government charges. All-wheel drive and extended-range batteries add thousands of dollars to that price. Ford’s EV full-sized pickup, the F-150 Lightning, has a base price of $62,995. An extended-range battery pushes that up by several thousand dollars.

Ford does not understand that people want more affordable EVs, not free charging equipment, which saves just over $1,000. People who have bought its EVs before the new offer may not be entirely happy that they did not get it.

Ford’s deal also does not address the spotty number of charging stations around the country, where there are lines and charging equipment sometimes do not work. Batteries may not fully charge in cold weather, and tires can also get less distance on EVs than on gasoline-powered cars.

The company sold 182,985 vehicles in the United States between January and August. Of these, 8,944 were EVs. Ford has slowed its efforts to build EVs and has moved toward promoting hybrids, which are more popular with buyers. Its new free offers are unlikely to move its EV needle by much.

Three Warning Signs Ford Is in Trouble

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.