DETROIT (Reuters) – Ford Motor Co. more than doubled the amount it plans to invest in electric and autonomous vehicles on Thursday, to $ 29 billion, even though it has a net loss of $ 2.8 billion in the fourth quarter achieved.
The American car manufacturer no. 2 also said that the global shortage of semiconductor chips could lead to a 10 to 20% loss in production in the first quarter.
For the year, Ford reported a net loss of $ 1.3 billion or 32 cents per share, compared to a modest gain the previous year of 1 cent per share.
Ford said earlier that it expects a profit of 2020 between $ 600 million and $ 1.1 billion.
Ford posted a loss of $ 2.8 billion, or 70 cents per share, in the fourth quarter, compared to a loss of $ 1.7 billion, or 42 cents per share, a year earlier.
The company’s forecast operating earnings will climb to $ 8 billion to $ 9 billion in 2021, compared to $ 2.8 billion last year. The 2021 figure includes a $ 900 million non-cash gain on Rivian, the start-up of electric vehicles in which Ford has invested, but that does not include the effects of the continuing global shortage of semiconductors.
Vehicle production lost due to chip shortages could cut Ford’s operating earnings by $ 1.0 billion to $ 2.5 billion in 2021, according to John Lawler, chief financial officer.
In the pandemic-stricken 2020, Ford’s total revenue dropped to $ 127 billion, from $ 156 billion in 2019.
Ford ended the quarter with nearly $ 31 billion in cash and $ 47 billion in liquidity, compared to nearly $ 30 billion and more than $ 45 billion in the previous quarter, respectively.
The company’s operating margin was 4.8% in the fourth quarter, compared to a full-year target of 8%. Ford said it expects an operating margin of 8% this year, including 10% in North America and 6% in Europe.
Ford has said it ‘doubles’ connected electric vehicles and says it will invest $ 22 billion in electrification by 2025, almost twice as much as it previously committed to motor vehicles.
Ford also said it would invest $ 7 billion in self-managed, or autonomous, technology development over ten years to 2025 – $ 5 billion of that from 2021.
“We are accelerating all our plans,” CEO Jim Farley said in a statement, including increasing battery capacity and adding more electric vehicles to his future portfolio.
CFO Lawler told reporters: “If EVs are quickly gaining favor, especially with commercial customers, we want to be clear that we will not allow anyone.”
Ford previously invested $ 11.5 billion in electrification, including gasoline-electric hybrid vehicles, until 2022. This included the launch of the Mustang Mach-E EV crossover and electric versions of the F-150 pickup and Transit van.
US rival General Motors Co. has said it will spend $ 27 billion on electric and autonomous vehicles by 2023. It is said that they plan to offer 30 EVs worldwide by 2025 and that they will reach annual sales of 1 million EVs in the United States and China by 2025.
Reporting by Ben Klayman and Paul Lienert in Detroit; Edited by Dan Grebler