Ford Motor Company has started 2025 on a stronger note, showing signs of progress in its electric vehicle (EV) business. In the first quarter, the company’s Model e division, which focuses on electric cars, recorded a big jump in sales and a smaller financial loss compared to last year.
According to the latest reports, Ford sold 31,000 electric vehicles between January and March 2025. That’s a 213% increase from the 10,000 units sold during the same period in 2024. Thanks to this growth, the company earned $1.2 billion in revenue from its EV division, a huge leap from just $0.1 billion a year ago.
Although the division is still losing money, the loss has shrunk. The EBIT loss for Model e now stands at $849 million, which is better than the $1.3 billion loss reported in the first quarter of 2024. These improvements are the result of not just higher sales, but also other smart moves.
One key reason for the sales boost was the launch of new electric models in Europe, especially the Capri and Explorer, which are being made in Ford’s Cologne plant. Along with that, the company managed to cut material costs and slightly increase the price of its vehicles, leading to better earnings.
Ford says it plans to continue focusing on improving profits in its EV segment by being careful with investments and developing better battery systems and new products. The company is clearly aiming to make its electric division more efficient and less costly over time.
However, not everything is going smoothly. Total company sales dropped slightly in Q1 to $40.7 billion, which is 5% lower than the same time last year. Most of this income came from Ford’s other divisions, with the Blue division bringing in $21 billion, and Ford Pro making $15.2 billion. The company’s overall adjusted EBIT also fell by 63%, now standing at $1 billion.
Looking ahead, Ford is concerned about potential new U.S. tariffs, which could cost the company an estimated $1.5 billion for the full year. These changes in trade policy could put more pressure on the company’s efforts to return to profit.
It’s also worth noting that just last year, Ford’s electric division had a very tough time. In 2024, sales were hit hard by price cuts across the industry, leading to overstocked vehicles and weak demand. That year, Model e suffered a $5.1 billion loss, even worse than in 2023. These challenges led to leadership changes and a fresh approach to the EV business.
In addition, there are reports that Ford may be quietly ending its development of the FNV4 software system, a high-tech brain designed to power its future smart cars. The company invested heavily in this system, so if it is truly canceled, it may help reduce expenses in the coming months.
All things considered, Ford’s EV division is not yet profitable, but the latest figures suggest it is moving in the right direction. With higher sales, lower costs, and more focus, the company is working to close the gap between investment and profit in the electric future.
Ford will have to implement swift measures to bolster profitability if it is to compete with Chinese firms like NIO Inc. (NYSE: NIO) that are operating profitably as a result of several factors, such as the low cost of Chinese labor.
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