Ford is currently in the middle of adopting a more balanced approach to its electrification strategy, a significant shift from several years ago, when it touted its plan to aggressively push battery electric vehicles. Instead, the automaker will offer a lineup that includes gasoline, partially electric, and fully electric models. Fortunately for the company, its already reaping benefits from its new approach, as Ford CEO Jim Farley recently revealed that certain Ford hybrids are more profitable than their gasoline counterparts.
When asked at the 2024 Berstein Annual Strategic Decisions Conference about how Ford can be competitive against Chinese rivals with inexpensive EVs, Farley delivered a lengthy responsive punctuated by a tidbit that represents in a shift regarding which vehicles Ford typically extracts profits from. “I think the other thing the fitness test is how quickly can some of the players adopt these kind of in-between solutions that customers are really excited about? A year ago, we weren’t covering the cost premium for a hybrid with the price that customers paid us. We are now. Many of our hybrids in the U.S. are now more profitable than their non-hybrid equivalent. That was not the case a year ago. Customers are voting. They like these in-between solutions.”
While Farley’s comments about modern Ford hybrids would have been extremely surprising several years ago, statements from other Ford executives suggest this has been a long time coming. As Ford Authority recently reported, Lisa Drake said that hybrid battery costs have decreased and will continue to do so over the next few years. That shift is good news for the company as it bets on hybrids as part of its new “Freedom of Choice” strategy aimed at offering vehicles customers want to buy, instead of pushing one particular powertrain technology. Farley also indicated that the cost to develop hybrid technology is relatively inexpensive and suggested that they’ll be around indefinitely.
Ford hybrids are currently limited to several segments in North America, although the company plans to offer a hybrid option on every retail model sold in the United States by 2030. In May 2024, hybrid sales and fully electric vehicle sales were up 65 percent in the United States.
We’ll have more on Ford’s hybrid vehicle strategy soon, so subscribe to Ford Authority for continuous Ford news updates.
Comments
A PHEV is different than a plain Hybrid version. Many wonder if the CEO is planning to include an expansion of PHEV models in the future.
Jim Farley said 10 years ago that Hybrids were the way forward. We are seeing that be true now.
I agree with Bill; I hope AWD PHEVs are included in the ‘plans to offer a hybrid option on every retail model sold in the United States by 2030.’ BUT, they killed off the one vehicle I’d like to see in AWD PHEV configuration: the EDGE!
I just picked up my Hybrid Area 51 that i have been looking for for 2 years!!!!!!! I cant believe it my 21yr old F150 finally gave it up, still running strong but gas tank rusted out and i had said next big repair and i am letting her go. Will be sad but i am sooooo excited about my Maverick may have to sleep out there tonight. Been driving Fords since first car 66 mustang (1973) and trucks ever since. i was about to give up and go without a Ford but patience won out.
Okay Jim, whatever you say! Sadly the numbers do NOT support his position.
The Mach E is a political, corporate, and financial disaster, cow-towing to the radical left (Marxist) climate activists. It is like DEI and ESG – it is Marxist and makes no sense in the real world. The biggest mistake was using the Mustang brand for this failed “politically motivated” product designed to fail from the outset. Farley and Ford really blew it on this one. How many are sitting unsold? How much has Ford lost? Ford should cut its losses and create the Mach G – a Godzilla powered, 50/50 balanced, rear wheel or all wheel drive, independent suspension luxury road racing car. Forget government mandates – politicians don’t know business markets, or the automobile markets, let alone honest politics. Give the market options to choose from. Ford would make a fortune…and bring some saving grace to bad corporate decisions of the past…
ok boomer. go outside and touch grass.
He’s a bit wishful, but is he wrong?
Where is the Ranger PHEV for U.S. customers?