“The move,” the New York Times reported, “is the latest example of how automakers are pulling back on aggressive investment plans in response to the slowing growth of electric vehicle sales.”
Several factors contribute to the low demand for EVs, including high prices, range anxiety and a lack of charging infrastructure. EVs are significantly more expensive than comparable fuel-powered vehicles, and the price gap is widening. Consumers also express concerns about limited driving range, particularly in cold weather, and the availability of charging stations.
Ford’s aggressive push into EVs, driven in part by government incentives and pressure, has resulted in significant financial losses.
“The costs of listening to industry experts and politicians in Washington instead of consumers – and profits – have been severe,” the American Institute for Economic Research (“AIER”) said.
The company lost billions of dollars on EV sales, selling each unit at a substantial loss. Ford reported a loss of $4.7 billion on EV sales in 2023, roughly $40,525 per vehicle sold.
It highlights the importance of meeting consumer demand in a free market economy.
“Ford’s massive pullback from EVs is part of a broader return to economic reality. Companies flourish in a free market economy not by serving bureaucrats but consumers, the true ‘bosses’,” AIER wrote.
As economist Ludwig Von Mises wrote, “The real bosses, in the capitalist system of market economy, are the consumers. They, by their buying and by their abstention from buying, decide who should own the capital and run the plants. They determine what should be produced and in what quantity and quality. Their attitudes result either in profit or in loss for the enterpriser. They make poor men rich and rich men poor.”
Automakers are paying the price for their poor decisions in the form of losses. But were not for the federal government’s attempts to coerce Americans into EVs – which included taxpayer-funded subsidies, overt pressure from Washington and federal regulations designed to phase out fuel-powered cars – misallocation of resources likely could have been avoided....<<<Read More>>>...