Elon Musk Supports Ford's EV Strategy, but Warns of Tough Margins

By Kevin Armstrong
Elon Musk warns Ford of tough margins on new vehicles
Elon Musk warns Ford of tough margins on new vehicles
TED

It should not be surprising that Elon Musk is lending his support to Ford. The long-established automaker has faced challenges in transitioning to electric vehicles. It revealed massive losses on EVs last week. While critics were quick to jump all over the legacy automaker, Tesla's CEO Elon Musk praised Ford's EV strategy on Twitter.

Ford's Model E Reports Losses Amid Shift to EVs

Ford's first-quarter results for 2023 revealed a loss of $700 million before interest and taxes for their Model E division, which is responsible for the development of electric vehicles. The EBIT margin for Model E was -102.1%, more than twice the -40.4% margin recorded in the fourth quarter of 2022. Ford only delivered 12,000 electric vehicles in the first quarter, resulting in a loss of $58,333 per clean car sold. Ford's Model E business is expected to lose $3 billion before taxes in 2023.

These losses have been attributed to higher costs related to engineering, spending, and inflationary pressures. Ford also reported weak sales volumes due to scheduled downtime at their Cuautitlan assembly plant in Mexico, which aimed to increase the Mach-E capacity to 35 jobs per hour.

Elon Musk Defends Ford's EV Strategy on Twitter

Recently, Tesla was compared to Ford from 100 years ago. When Henry Ford created the assembly line, it revolutionized auto manufacturing and put several car makers out of business. While Musk understood the comparison, he disagreed with ending the competition. Tesla has opened all of its patents to competitors, staying true to its mission: to accelerate the advent of sustainable transport by bringing compelling mass-market electric cars to market as soon as possible. 

Responding to a tweet criticizing Ford's negative margins on electric vehicles, Musk acknowledged the challenges of transitioning to new technologies and praised Ford's EV strategy as "smart." He also highlighted the high demand for the electric F-150 Lightning.

This exchange occurred amidst a price war between Tesla and Ford. Tesla has lowered its vehicle prices six times this year, forcing Ford to cut the Mustang Mach-E's price by up to 8% to remain competitive.

Ford's Goals for Model E and Electric Vehicle Fleet

Despite the setbacks, Ford has set ambitious goals for its electric vehicle lineup. The company aims for a global EV production of 600,000 units by the end of 2023 and two million by the end of 2026. By 2030, Ford anticipates that 40 to 50% of its vehicle fleet will be electric, with a pre-tax profit margin of 8% for its Model E division.

Despite Ford's current struggles in transitioning to electric vehicles, the company has ambitious goals for the future, and even Musk believes in its strategy.

A Better Routeplanner 5.0 Launches; Adds EV Charger Ratings Using Rivian Data

By Karan Singh
Not a Tesla App

A Better Routeplanner 5.0 launched yesterday, and there are some pretty awesome features coming to all EV owners courtesy of Rivian. Rivian purchased ABRP last year and has made good on its promises to continue its improvement and ensure it remains open to all EV owners.

Charger Scoring

Rivian recently added a feature that would rate any chargers compatible with Rivian vehicles. The list of chargers includes Rivian Adventure Network (RAN) chargers, Tesla Superchargers and any other compatible third-party chargers. The charger score is automatically calculated based on the station's average top speed and reliability.

With the launch of ABRP 5.0, Rivian is integrating its charger scores directly into the free tier of ABRP so that all EV owners can benefit. ABRP users will now be able to see charger scores, and ABRP will automatically route users to chargers with higher scores if they are available on your route.

Google Automotive

Another cool feature for ABRP is that it will now be available as an app to install and use directly in vehicles that support Google Automotive. Any EV that uses Google Automotive, including Volvo,  Polestar, Ford, and GM will support the in-system experience, which will also provide data for charger scoring and routing.

This will be an excellent way to hold third-party networks accountable, which have commonly suffered from uptime or speed issues.

Tesla’s Implementation

Tesla previously implemented a “Qualified Third-Party Charger” program, that would allow highly-rated third-party chargers that meet a strict set of requirements to be displayed directly in the vehicle. However, this is currently limited to Europe and parts of the Middle East. Within North America, Tesla only displays third-party Tesla destination chargers in addition to Superchargers.

While Tesla doesn’t directly show charger scores, they clearly are tracking charge data, and are providing the cream of the crop of third-party chargers for navigation where the program is available. We’d hope that this implementation of qualified third-party chargers also comes to North America, as NACS is becoming the de facto standard for charging.

If Tesla does expand the display of third-party chargers to other regions, it’ll likely be similar to what we see in Europe today, and won’t be as open as Rivian’s implementation in ABRP.

Tesla Begins Testing FSD in China

By Karan Singh
Not a Tesla App

Tesla was recently granted permission to test FSD on Chinese streets – specifically in Shanghai. Just recently, Elon Musk visited China and discussed the potential for FSD to come to China.

Gearing Up for FSD China

This is just the first step for Tesla to begin its customer deployments of FSD – Tesla conducts similar ADAS testing in North America, where special testing vehicles and testing employees run the latest FSD (Supervised) versions against a gamut of real-world, real-life tests.

Tesla has recently been working on translating FSD release notes into multiple languages, alongside building a data center in Shanghai and establishing an FSD Operations and Labelling team at the same center. These are the first, key steps to bringing FSD to a new market that has unique and different traffic rules when compared North America.

China doesn’t have the regulatory hurdles or challenges that Tesla faces in Europe to bring FSD and has been working with Chinese corporations as well as the government, which has now provided its official approval for FSD testing in-country.

We might even see FSD deployed to early testing customers in China by the end of 2025.

ADAS Competitors

There are quite a few competitors in the Chinese market already- with challengers like Xpeng and Xiaomi working on building their own homegrown systems, mostly driven by a mixture of cameras, radars, ultrasonic sensors, and LIDAR. However, many of these systems face similar challenges to other non-Chinese competitors and don’t have the mileage under their belts to tackle Tesla’s dominating lead in data and data processing.

European Union

Tesla is poising itself for an FSD rollout internationally, with increased testing also taking place in the UK, France, and Spain – some of the key locations with unique infrastructure in the European Union. However, some EU-specific regulations restrict how FSD can perform – each and every action must be manually approved by the driver. Until that regulation is changed to adapt to systems like FSD, it won’t be making its way there just yet.

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