Ford Clearing The Road For New Electric Vehicles, Phasing Out Three Gas Models


Summary

  • Ford is fully committed to its electric ambitions and is phasing out gas-powered models, including the iconic Fiesta, to make way for the transition to EVs by 2030.
  • Despite delays and setbacks, Ford has had a productive year in EV sales and aims to streamline production by converting its Oakville assembly plant into an EV manufacturing hub.
  • Ford acknowledges that its EV business may face significant losses in the near term, but remains confident in the long-term prospects and is focused on reducing costs and increasing margins by 2026.


Electrification of the automotive industry is picking up pace. Legacy car manufacturers are racing to roll out their electric cars to keep up with the evolving industry.

Ford, an industry giant, is going all-in with its electric ambitions. The company is aiming to go all-electric by 2030. Towards that end, Ford is quick and strategic in phasing out three more of its gas-powered models. After the discontinuation of the iconic Fiesta, Ford Edge, Escape, and Transit Connect are being phased out as well.


Ford Launched The ‘Trust the Truck’ Initiative

Blue Ford Explorer EV on mountain road
Ford

In February, Ford CEO Jim Farley confirmed the development of an in-house EV platform for the next generation of electric vehicles. Titled T3, or “Trust The Truck,” this initiative involves a team developing an electric truck. The truck will be capable of towing, hauling and more new innovations. Ford described this upcoming EV as “like the Millennium Falcon – with a back porch.”

Ford’s transition to EVs hasn’t been smooth sailing, with a lot of delays and setbacks in 2023. But the automaker seems fully committed to the process. Ford does not have much choice either, as the entire industry is transitioning.

The American automaker will be using the new BlueOval City complex in Tennessee for the manufacturing. Spread over six square miles, the name of the complex comes from Ford’s logo – the blue oval. Ford seems committed to streamlining EV production in North America. It plans on converting the Oakville assembly plant into an EV manufacturing hub. The idea is to port the battery cells and arrays from the BlueOval City hub to the Oakville plant.

To make space for the new-gen of Ford EVs, the company recently discontinued three classic gas-powered models.

Ford Is Discontinuing ICE Models To Make Way For EVs

2023 Ford-Escape- 1500x750
Ford

The Ford Escape, Edge, and Transit Connect are being discontinued by the automaker.

Ford announced its plan to discontinue the much-loved Ford Fiesta in 2022. After a glorious 47-year run spanning over eight generations, the Fiesta was finally discontinued in June 2023. Dropping some of its most popular offerings is a bold move by the automaker, but their strategy seems to be clear: transitioning heritage models to electric.

So far, Ford’s EV efforts have been productive despite the recent delays. The company had a big year in 2022 after selling 61,575 EVs in the US, becoming the second-largest EV maker in the US behind Tesla.

The automaker reassigned production space in its German plant to the new Explorer. Built on Volkswagen’s MEB platform, the Explorer has quite an attractive starting price of under $50,000. Ford has been keeping its EVs as affordable as it can. The F-150 Lightning starts at around $49,000 while the Mustang Mach-E starts just shy of $43,000.

Both the F-150 Lightning and Mach-E are available in the North American market, and leverage heritage names and branding to ease the skeptical customers making the transition to their EVs. Ford is employing the same strategy with the electric Explorer.

Related: How This New Battery Design Will Make Ford Mach-E, F-150 Lightning More Affordable

Ford’s EV Business May Face Significant Losses

Blue 2020 Ford Explorer Hybrid parked outdoors in the woods
Ford

Ford’s transition to EVs has had its fair share of obstacles. In its Q2 earnings report, Ford observed that the pace of EV adoption in the near term may be slower than they were expecting. The company also pushed back the launch of the electric Explorer in Europe. Despite that, the Ford CEO suggested that this would be in favor of early movers like Ford.

Ford’s current EV lineup includes the F-150 Lightning, Mustang Mach-E, and the E-Transit electric van in the U.S. market. The company is also planning the production of the electric Explorer SUV in Europe. It signals that a US release may be possible should the demand for a compact electric vehicle arises.

Ford acknowledges that its EV business may face more significant losses than anticipated in 2023, but it remains confident in the long-term prospects. The push for electrification is now a huge part of Ford’s strategy. Since the industry is rapidly evolving, spearheaded by Tesla, the segment is getting more and more competitive.

Related: Ford Makes It Up To Mustang Mach-E Owners Facing Delivery Delays

What makes things more complicated is that the demand for Ford’s EVs appears to be cooling. Ford announced that it is reducing the price for the base F-150 Lightning by 17 percent in an attempt to make up some sales ground.

Ford’s goal of producing 400,000 EVs every year by 2024 may face a delay too. It is also evaluating its target of delivering two million EVs per year by 2026. These are ambitious numbers by all means. But going by the moves the company is making, they seem confident in their second-gen EV platform’s ability to reduce costs. In fact, Ford is aiming at an eight percent margin by 2026.

Ford Bids Farewell To Gas-Powered Models

Gold 2015 Ford Edge Sport on the parking lot
Ford Media

The gas-powered Ford Escape, Edge, and Transit Connect are being phased out to make way for EVs. Ford’s commitment to an electric future is evident in the fact that the facility where Fiesta was once produced will now manufacture the electric Explorer. That poetically summarizes Ford’s transition from long-standing popular gas-powered models to EVs.

As a part of the larger trend in the automotive industry, Ford aims to be an early mover. To some extent, it already is one, despite the massive competition in the segment. The transition from internal combustion engines (ICE) to electric is now industry-wide.

As observed, Ford is not alone in its shift towards electric mobility. Legacy automakers that have long relied on gas-powered models are now aiming for electrification. GM is a great example of another early mover as it introduced the Chevrolet Spark EV in 2013, followed by the Chevy Bolt in 2015. Despite discontinuing the Spark, GM continues to explore its electric options. A potential return of the Bolt may be on the cards too.

Nissan, with its acclaimed Leaf, was an early entrant into the electric vehicle market. However, Tesla’s Model S disrupted its reign as the top-selling EV. Now, Nissan plans to phase out the Leaf and introduce new electric models by 2026.

Related: How The Ford F-150 Lightning Can Be The World’s Best Selling Vehicle

Toyota, known for its commitment to hybrid tech, has also joined the EV race. It recently pledged to launch ten new EVs by 2026. Stellantis discontinued its iconic muscle cars, the Dodge Challenger and Charger, as well as the Chrysler 300. It hinted at an electric version coming up soon.

All major automakers are making bold moves, determined to make inroads in the EV market. This trend is paying off for some, while others are struggling to achieve their goals. While Ford started off strong in the segment, the EV registrations in the first five months of 2023 paint a disappointing picture.

Ford’s transition to electric vehicles has not been without its challenges. Early this year 2021 Ford Mustang Mach-E Owners experienced major delays. The discontinuation of the Escape, Edge, and Transit Connect indicates Ford’s electrification aims. The automaker is streamlining production and investing in its electric future. As one of the most established players in the industry, Ford’s transition reflects the major trend in the automotive industry.



Read More: Ford Clearing The Road For New Electric Vehicles, Phasing Out Three Gas Models

2023-09-04 16:06:00

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