Ford's business will gradually transition from its internal combustion vehicles to battery electric vehicles, but combustion vehicles will continue to grow for the next few years, CFO John Lawler told Cheddar News.
"Over time, we do see the transition between internal combustion engines — gas vehicles — to [battery electric vehicles] but that's going to be over time," he said. "We still see growth for [internal combustion engine] businesses over the next few years."
That optimism comes in spite of a $2.1 billion loss that Ford's electric vehicle division reported in 2022. The company anticipates the segment will lose an additional $3 billion in 2023, as it works toward profitability in 2026.
Lawler joined "Wake Up with Cheddar" after the automaker announced a major change in the way it reports financials. Instead of reporting geographic results, the new format will break out financials for three customer-facing groups. "Ford Blue" will include its traditional gasoline, diesel, and hybrid vehicles like the F-150 and Mustang. "Ford Model E" includes all electric vehicles, and "Ford Pro" includes commercial vehicles and fleets. The company is framing this shift as a whole new Ford.
"What we've done in creating Ford Blue, Ford Model E, and Ford Pro is far more than an accounting exercise. After 120 years, we've essentially refounded Ford," Lawler said on a call with the press on Wednesday evening.
Following the change, Ford also reviewed what 2021 and 2022 financials would have looked like in the new format. Whereas the Model E segment lost about $2.1 billion, Ford Blue and Ford Pro brought in $6.8 billion and $3.2 billion, respectively.
Lawler justified Model E's losses as par for the course for electric vehicles, describing the segment as a "startup that was buried inside of Ford Motor Company."
"Like all electric vehicle startups, you lose money at first as you're building scale, as you're designing your products, as you're growing and building share," he said.
The company's path to achieving 8 percent EBIT margin by 2026 in the Model E segment will be facilitated by scale and design efficiency for things like batteries, Lawler said. The company also plans to shave about $3 billion in structural costs from the company's balance sheet by 2026. Lawler said reducing design complexity and increasing reuse and commonality would be "some of the main levers" to cut those costs.
Ford was one of the biggest producers of electric vehicles in 2022, second only to Tesla. In spite of all the buzz around EVs, Lawler emphasized that Ford is still focusing on all three of its segments.
"Right now all three businesses are growth businesses," he said.
Astra founder, chairman, and CEO Chris Kemp spoke to Cheddar's Kristen Scholer about his company's first successful launch into orbit last month, becoming the fastest space company to reach orbit using a privately developed liquid-fueled rocket. He also noted that the company's priority is to "improve life on Earth from space" by rapidly increasing the number of low-orbiting satellites to do everything from connecting people to monitoring weather patterns.
Once again, YouTube is releasing its annual list of the top trending videos and music videos that had people in the U.S. talking. Madeline Buxton, trends expert for YouTube joins Cheddar News to discuss.
Stocks closed at session lows Wednesday as investors grew skittish over the first reported case of the COVID-19 omicron variant in California. Josh Sailar, Partner at Blue Zone Wealth Advisors, joins Cheddar News' Closing Bell to discuss investor worry over the new variant, the Fed dropping the word 'transitory' to describe inflation and potentially speeding up their asset tapering timeline, 2022 predictions, and more.
The Robin Hood Foundation is New York City's largest poverty-fighting organization. For more than 30 years, Robin Hood has built and fueled non-profits across all five boroughs. CEO Richard Buery joined Cheddar News' Closing Bell ahead of his ringing the closing bell at the New York Stock Exchange and later, lighting of the NYSE Christmas tree.
Creator commerce platform LTK raised $300 million in a recent funding round, now valuing the company at $2 billion. LTK is the world's largest influencer marketing platform and is known for helping to pioneer the so-called 'creator economy.' The company helps content creators make money off of their social media posts by hosting them on one central marketplace. LTK says more than $3 million in products are bought each year on its website and app. Now, the company is looking to continue its growth. LTK co-founder and president Amber Venz Box joins Cheddar News' Closing Bell to discuss.
As cases of the COVID-19 Omicron variant continue to pop up, including the first U.S. case in California, how will domestic holiday travel be impacted? That part of the travel sector has mostly recovered from the year-long pandemic rout, while business travel continues its slump. But could a new variant bring new lockdowns and domestic restrictions? Clint Henderson, Senior News Editor at The Points Guy, joins Cheddar News' Closing Bell to discuss what the omicron variant means for holiday travel, best practices for passengers traveling through airports, and more.
Microsoft recently announced the standalone Teams Essentials as businesses continue to update their practices for the new norm of hybrid work life. Jared Spataro, corporate VP at Microsoft Modern Work, joined Cheddar to talk about solutions the tech giant has rolled out in order to help underserved small and medium-sized companies continue operations seamlessly. "We're excited about the opportunity to serve their needs better, and that, in particular, is focused on their meeting and communication needs," he said. "We start with Teams, which has been a wildly successful product for us up in the enterprise space, and now we have created a form of Teams that is particularly suited for small businesses."
Online resale platform eBay is growing its investment in the sneakers market after acquiring Sneaker Con's authentication business. Garry Thaniel, general manager of sneakers at eBay, spoke to Cheddar about why this was an ideal time to take the already established relationship between the companies to vet collectible footwear. "The sneaker market is valued at over $20 billion, and what we've seen at eBay is quarter-over-quarter, double-digit growth," he noted. "When we talk about our partnership with Sneaker Con, we've authenticated over a million and a half sneakers in just over a year."
No matter what you're in the market for this holiday season, there is one way that you can put some cash back in your pocket and stretch your gift budget a little bit further this year. With Lolli, for every gift you buy for someone else, you get the gift of free bitcoin back. CEO of Lolli, Alex Adelman, joins Cheddar News.
