Ford has announced its financial targets for 2024, as well as its revised plans for the electric vehicle market. The automaker expects to increase its revenue, profit margin, and cash flow, while also adjusting its EV investments and production targets.
Ford’s Financial Targets for 2024
Ford has set ambitious financial goals for 2024, as part of its global strategy to improve its performance and competitiveness. The company expects to achieve the following results by 2024:
- Revenue of $190 billion, up from $176.2 billion in 2023
- Adjusted EBIT margin of 8%, up from 6.1% in 2023
- Adjusted free cash flow of $12 billion, up from $9.3 billion in 2023
- Return on invested capital of 14%, up from 10.2% in 2023
The company also expects to maintain a strong balance sheet, with a net cash position of $25 billion and a net debt-to-EBITDA ratio of less than 1.5. The company plans to use its cash flow to invest in growth opportunities, pay dividends, and reduce debt.
Ford’s Chief Financial Officer John Lawler said that the company’s financial targets are based on its core strengths, such as its iconic brands, its loyal customers, and its leading positions in key markets. He also said that the company is focused on delivering value to its shareholders, while also investing in the future.
Ford’s EV Strategy for 2024
Ford has also reassessed its EV strategy for 2024, in light of the changing market conditions and customer preferences. The company has decided to delay or cancel some of its planned EV investments and production targets, while also enhancing its EV technology and capabilities.
The company has made the following changes to its EV strategy:
- Delayed the launch of the F-150 Lightning electric pickup truck from late 2023 to early 2024, due to supply chain issues and labor disputes
- Reduced the production target of the F-150 Lightning from 150,000 units per year to 100,000 units per year, due to lower than expected demand and competition
- Canceled the development of a new EV platform for midsize and large SUVs, due to cost and complexity issues
- Enhanced its EV battery technology, by partnering with SK Innovation to develop and produce nickel, cobalt, manganese, and aluminum (NCMA) batteries, which are more energy-dense and cost-effective than the current lithium-ion batteries
- Expanded its EV charging network, by adding more than 10,000 new charging stations across the US, in collaboration with Electrify America and other partners
Ford’s CEO Jim Farley said that the company’s EV strategy is based on its customer-centric approach, which aims to offer the best products and services for its customers. He also said that the company is committed to leading the electrification of its core segments, such as trucks, vans, and SUVs.
The Impact and Implications of Ford’s Announcements
Ford’s announcements have received mixed reactions from the industry experts and analysts. Some have praised the company’s financial targets, saying that they are realistic and achievable, and reflect the company’s improved operational efficiency and profitability. Others have criticized the company’s EV strategy, saying that it is too conservative and cautious, and risks losing market share and competitive edge to its rivals.
The announcements have also had an impact on the company’s stock price and market value. The company’s shares rose by 5% on Tuesday, following the announcement of its financial targets, reaching a 52-week high of $16.45. However, the shares fell by 3% on Wednesday, following the announcement of its EV strategy, dropping to $15.93. The company’s market value is currently around $63 billion, which is still below its main competitors, such as Toyota, Volkswagen, and Tesla.
