Ford’s EV losses hit billions in 2024, is the worst yet to come?

Ford closed 2024 with staggering losses from its electric vehicle business, shedding $5.1 billion—an increase from the $4.7 billion lost in 2023. 2025 doesn’t look much better, either, with the company forecasting up to $5.5 billion in losses. Despite the EV unit’s bleak financials, CEO Jim Farley insisted that “Ford is becoming a fundamentally stronger company.”

A record year marred by EV losses
Ford managed to beat Wall Street’s expectations for the fourth quarter of 2024, posting $48.2 billion in revenue, up $2.2 billion year-over-year. Gains from its gas-powered vehicle sales helped offset net losses from an unprofitable EV business.

In total, Ford generated $185 billion in revenue for the year, its highest ever, but its EV segment, Model e, lost approximately $37,000 on every electric vehicle sold in the fourth quarter alone, Electrek reported. According to Ford, these losses were driven by pricing pressures and a 35% drop in revenue from its Model e division, which is facing increased competition from rival automakers.

Tariffs could compound Ford’s problems
President Donald Trump’s threats to impose 25% tariffs on imports from Mexico and Canada could further inflate costs for Ford, which builds its popular Mustang Mach-E in Mexico. CEO Jim Farley acknowledged that a few weeks of tariffs would be “manageable,” but prolonged trade restrictions could lead to “a huge impact on our industry, with billions of dollars of industry profits wiped out and adverse effect on the U.S. jobs, as well as the entire value system in our industry.” Elevated costs would also drive prices higher for consumers, Farley said.

The potential elimination of Biden-era EV incentives is another looming challenge. If Trump follows through on his promise to end federal EV tax credits, it could further hinder Ford’s ability to compete with market leaders like Tesla and General Motors, both of which have broader and more profitable EV lineups.

Falling behind in the EV race
While Ford has been slow to introduce new EVs to its lineup, its rival General Motors released several new EV models in 2024 and reported a “positive variable profit” from its electric vehicle sales. Ford, meanwhile, currently offers just three EVs—the Mustang Mach-E, F-150 Lightning, and E-Transit van—and had to cancel plans for an electric three-row SUV.

To address these issues, Ford is rethinking its approach. Farley announced that the company is working on new powertrain strategies, including plug-in hybrids and extended-range EVs with small gas engines capable of charging the battery and delivering up to 700 miles of range. The company is also exploring flexible vehicle platforms to accommodate multiple powertrain options.

Final thoughts
Despite ongoing challenges, Ford is betting on a mix of hybrid and extended-range EVs to stabilize its losses. Given the growing affinity among American drivers for mixed-powertrain vehicles, that approach might just work, but Ford has a long way to go. The coming year will be a crucial test of whether Ford can turn its EV business around or if the losses will continue to pile up.