Ford to spend big on EVs and self-driving cars

Ford is more than doubling the amount of money it plans to invest in electric and autonomous vehicles to US$29 billion (NZ$40.1b).

The pledge comes despite the marque ending 2020 with a fourth-quarter net loss of $2.8b.

John Lawler, chief financial officer, says: “If EVs [electric vehicles] continue to quickly gain favour, especially with commercial customers, we want to be clear that we will not cede ground to anyone.”

Ford says it will spend US$22b on electrification through 2025, nearly twice what it had previously committed to EVs. The cash will go towards increasing battery capacity and adding more low-emissions models to its line-up. 

The carmaker also plans to spend US$7b on self-driving, or autonomous, technology development over 10 years, report Reuters.

Ford announced its ambitions at the same time as posting a net loss of US$1.3b for 2020.

It had previously expected a full-year profit of between US$600 million and US$1.1b, but the fourth-quarter dip weighed on its finances. 

The carmaker predicts operating earnings will be between US$8b and US$9b in 2021, compared with US$2.8b in 2020.

The effects of the Covid-19 pandemic saw Ford’s total annual revenue fall from US$156b in 2019 to US$127b last year.

Its operating earnings are expected to take a hit at the start of this year, with the marque warning the global semiconductor chip shortage may lead to first-quarter production dropping by up to 20 per cent.

Ford says this will drop operating earnings by US$1b to US$2.5b for the first three months of 2020.