Ford Delays New Electric Vehicles As Sales Falter, Joins Pivot To Hybrids Instead

Good morning! It’s Friday, April 5, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.

1st Gear: Ford Delays New Electric Truck To 2026

It’s that time of the month when car makers across the U.S. tell us all about how great their sales are doing, unless they’re Tesla. At Ford, however, while it claimed the title of second-best-selling EV maker in the U.S. thanks to price cuts for its Mustang Mach-E, the blue oval took the opportunity to announce that, actually, it’s EVs aren’t doing great and it’s probably going to delay any new ones.

We’ve had suspicions that this could be coming for a while, but this week Ford confirmed that its new electric truck won’t launch until 2026 and a three-row electric SUV now won’t hit the streets until 2027, reports the Guardian. The move comes as it makes the decision to delay new electric models and instead roll out a raft of hybrid cars into its lineup. As the Guardian explains:

The Dearborn, Michigan, company said on Thursday that a much ballyhooed new electric pickup to be built at a new factory in Tennessee will be delayed by a year until 2026.

The big electric SUV, with three rows of seats, will be delayed by two years until 2027 at the company’s factory in Oakville, Ontario, near Toronto.

The retreat comes as US electric vehicle sales growth slowed to 2.7% in the first quarter of the year, far below the 47% increase that fueled record sales and a 7.6% market share last year. Sales of new vehicles overall grew nearly 5%, and the EV market share declined to 7.1%.

Sales of hybrid models, however, were up 45 percent in the first three months of 2024, reports the Guardian. As a result, Ford now confirmed that new hybrid models are coming to its lineup. According to Reuters, the Blue Oval has confirmed that it would be “boosting hybrid electric vehicle offerings” in the coming years, with ambitions to offer hybrid powertrains across its lineup by 2030.

Ford’s decision to focus its attention on hybrids comes after the U.S. Environmental Protection Agency softened its EV requirements last month. The new regulations soften the ramp up to electrification for manufacturers and “further incentivized plug-in hybrid vehicles,” reports Reuters.

2nd Gear: Volvo Is Doing Just Fine

While Ford has been struggling to shift its EVs, Volvo has benefited from its decision to add batteries to its cars for a record-breaking start to 2024 with the Swedish automaker posting 25 percent sales growth last month.

Volvo, which is majority-owned by Lotus owner Geely, sold more than 78,000 cars last month, reports CNBC News. The milestone marked a 25 percent increase over March 2024 and helped the automaker to post sales growth of 12 percent for the first three months of the year when compared with 2023. As CNBC reports:

Volvo Cars said that its new all-electric EX30 model had boosted growth and that it would focus on ramping up sales of the vehicle in the coming months.

The company’s year-on-year sales of electric vehicles in Europe were 22% higher in the quarter and up 34% year on year in March, roughly in line with overall sales growth in that market.

Sales of electric models to China, the largest EV market, dropped by 36% despite a 4% hike in overall sales.

In the U.S., Volvo’s sales were up 17 percent in March. However, the company got there via a 44 percent increase in sales of hybrid models and a 65 percent dive in sales of all-electric cars.

Volvo will be hoping that its latest effort can help buck the trend of slowing EV sales, with the new EX30 electric SUV set to hit the streets of America later this year with its smaller price tag to help draw in those hesitant about the jump to battery power.

3rd Gear: Boeing Output Hits ‘Single Digits’

The slowdown in EV sales and production is shocking to see, but it’s nothing compared to the grinding halt that Boeing is coming to as a result of new measures put into place by the Federal Aviation Agency. The government body has imposed strict production caps on the troubled plane maker while it gets to the bottom of quality control issues that led to several high-profile mechanical failures in recent years.

Earlier this year, the FAA capped Boeing’s output at 38 planes per month, but Reuters reports that the company has fallen well below that and even hit “single digits” in March. While production slows at Boeing, the FAA is carrying out all manner of factory checks and analysis to see where Boeing is at. Reuters reports:

Boeing referred to comments by CFO Brian West who said last month it was taking comprehensive steps to strengthen quality and build confidence – including reducing the amount of so-called traveled or pending work – as the FAA increases audits.

West told a Bank of America event that the FAA was “deeply involved and undertaking a tougher audit than anything we’ve ever been through before.”

Boeing also says it has made efforts to reduce the amount of so-called “traveled work” – or planes moving down the line with jobs still needing to be fixed from earlier work stations. The effect is to slow overall production and, in turn, deliveries.

The slowdown at Boeing won’t just affect its bottom line, however. Reuters warns that a drastically reduced output at the firm’s Seattle hub will hit airlines, who may be forced to spend more leasing planes – the increased cost of which could be passed on to travelers looking to book their next trip.

4th Gear: Mercedes Isn’t Anti-Union, Says Mercedes

In the U.S., Mercedes-Benz is staring down the barrel of a union vote at its Alabama plant that will poll employees on membership of the United Auto Workers Union. Membership in the union is a hot ticket these days, after it fought for big wins at Ford, Stellantis and General Motors last year, and president Shawn Fain pledged that the next time they negotiated a contract for the Big Three it could grow to a “big five or six.”

Now, after a vote was called at Mercedes’ Alabama plant, the German automaker has claimed that it definitely isn’t anti-union, reports Automotive News. The allegations were banded around after the UAW filed charges against the Germany automaker for violating global supply chain practices in its home country. As Automotive News explains:

The UAW on Wednesday said it filed charges against Mercedes-Benz Group for violating Germany’s global supply chain practices which prohibits German companies from disregarding workers’ rights to form trade unions.

“Workers at Mercedes-Benz’s sprawling assembly and battery plant in Vance are organizing to join the UAW and have faced fierce backlash from company management,” the union said in a statement.

In response, Mercedes said it couldn’t comment on the matter as it had “not received a complaint in Germany,” reports the site. In a statement, Mercedes told Automotive News that it recognized “the right of our employees to form employee representatives.”

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