Tuesday Ticker: No profit in Ford EV unit until 2026; Tesla shares rise amid Wall Street predictions

Toronto, Ontario ⁠— This weekly Tuesday Ticker is electric, as Ford bares all on its Model e EV unit and Tesla sees a Monday morning boost, courtesy of Wall Street predictions.

Ford’s future flub

Ford does not expect its electric vehicle (EV) unit to be profitable until 2026, the OEM said last Thursday.

Known as Model e, Ford’s EV unit lost US$2.1 billion in 2022 and could lose as much as US$3 billion in 2023. Ford’s Model e business also reported US$900 million losses in 2021.

The automaker says it sold approximately 96,000 EVs in 2022, representing US$5.3 billion in revenue. 

On EBIT, Ford Model e worked with a profit margin of negative 40 percent in 2022. The automaker said the unit is targeting an 8 percent operating profit margin, and profitability, by 2026. 

For comparison, Tesla reported a 22 percent profit margin for Q4 2022.

Nonetheless, Ford CFO John Lawler remains confident. 

“We’re already seeing green shoots of the improvements in the profitability of Model e,” Lawler told audiences during an investor event last week. “We expect Model e to break even at the end of this year, and, in 2024, we believe our first-generation products can be EBIT margin positive.”

Target practice at Tesla

As Tesla prepares to release its Q1 2023 delivery and production data, analysts are predicting the electric automaker will report record-setting delivery numbers.

Wall Street is predicting approximately 430,000 Tesla deliveries for Q1 2023, based on “commentary on the pace of production imply[ing] some upside,” said Barclays analyst Dan Levy. 

Levy went on to suggest that such delivery numbers could be a “catalyst for the stock.” 

“Expectations [for Tesla] have come down amid signs of softening demand.”

If Tesla does report 430,000 deliveries, it would represent a 39 percent increase compared to Q1 2022, when the automaker delivered 310,000 units. In Q4 2022, the EV maker reported just over 400,00 deliveries⁠—a 31 percent jump over Q4 2021.

Wall Street forecasts Tesla deliveries in 2023 to ring in around 1.8 million units. 

Tesla shares were trading at US$194.80 per share as of 11 a.m. EST Monday, up 2.4 percent from market open. 


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