Ford’s EV Segment Data Spells Trouble For Rivian, Lucid Motors

On March 23, Ford Motor Company (NYSE: F) broke out summary 2021 and 2022 results of its electric vehicle manufacturing business (Ford Model e in below figure) from its legacy internal combustion engine (Ford Blue) and commercial vehicle (Ford Pro) lines of businesses.

In 2021 and 2022, Ford’s electric vehicle (EV) business generated operating losses of US$900 million and US$2.1 billion, respectively. The company expects EV operating losses will reach US$3 billion in 2023. 

However, by the end of 2026, Ford management anticipates quite a turn toward profitability as the company plans to realize an 8% operating margin at that time based on an EV annualized production rate of 600,000 vehicles. Unfortunately, Ford did not provide any real specifics on how this transition to profitability will occur aside from higher production rates.

Ford Motor Company’s Recast Results

Comparisons between Ford’s EV business and the biggest, most well-known EV start-ups Lucid Group, Inc. (NASDAQ: LCID) and Rivian Automotive, Inc. (NASDAQ: RIVN) are displayed below.


(millions of US dollars, except vehicle deliveries)202120222023E2026E
Vehicle Deliveries
Ford Motor EV Business27,14061,575600,000
Operating Income
Ford Motor EV Business($900)($2,100)($3,000)8% EBIT margin by late 2026
Adjusted Operating Income (A)
Rivian($2,987)($5,869)($5,100) (B)
(A) Adjusted EBITDA minus Depreciation & Amortization.
(B) Assumes US$800 million of Depreciation & Amortization in 2023.

The read-throughs from Ford’s disclosures raise significant concerns for Lucid and Rivian.

For instance, Ford sold 61,575 EVs in 2022 and 27,140 in 2021 yet still generated substantial losses. Furthermore, losses will grow further in 2023 even as production presumably continues to increase. (Ford has not issued guidance on EV unit sales for 2023.)

Lucid and Rivian each sold far fewer units in 2022 than Ford did. Rivian may approach Ford’s 2022 unit production in 2023, but Lucid seems unlikely to come close to that level for some time. The sales prices of Lucid’s and Rivian’s cars exceed Ford’s, but it may take enormous increases in their annual production rates before breakeven is achieved based on the linkage between Ford’s 60,000+ manufacturing pace in 2022 and still a US$2+ billion operating loss absorbed last year.

Note that losses in Ford’s EV business will likely increase ~40% to US$3 billion in 2023 from US$2.1 billion in 2022 even though production is rising. Both Lucid and Rivian expect to approximately double vehicle production in 2023 versus 2022. However, based on Ford’s guidance, investors may now be less certain those higher manufacturing rates will translate into lower operating losses and smaller cash burn rates. In 2022, Lucid’s adjusted operating loss (defined as adjusted EBITDA minus depreciation and amortization) was US$2.2 billion; Rivian’s was US$5.9 billion.

Based on the Ford data, it may take much longer than many investors expect for Lucid and Rivian to achieve profitability, as the annual number of vehicles which each must sell to accomplish this may simply be higher than many expect.

Information for this story was found via Edgar and the sources and companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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