KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
Ford Motor Co. is significantly adjusting its electric vehicle (EV) strategy, canceling plans for a fully electric sport utility vehicle (SUV) and reducing its overall investment in EVs. This recalibration could cost the automaker approximately $1.9 billion as it pivots towards other priorities, including enhancing its hybrid offerings and optimizing battery sourcing to compete with lower-cost rivals, particularly from China.
Key Takeaways:
Cancellation of Electric SUV and Strategic Realignment: Ford has scrapped plans for a fully electric three-row SUV, which had already been delayed. The company concluded that it couldn’t make the SUV profitable, leading to a shift in focus. The automaker will instead consider extended-range electric vehicles (EREVs) for its next-generation SUVs. These vehicles, popular in China, use a small gasoline engine to keep the battery charged, enabling a longer driving range.
Reduction in EV Investment: Ford is scaling back its spending on EVs, reducing its allocation to 30% of its annual capital expenditures, down from the previous 40%. This reduction is part of a broader strategy to ensure profitability for new EV models within a year of their launch. The company also postponed the release of a next-generation electric pickup and plans to introduce a battery-powered midsize pickup truck in 2027.
Financial Impact and Production Shifts: Ford will incur a non-cash charge of about $400 million due to the write-down of manufacturing assets related to the canceled SUV. Additionally, the company may face up to $1.5 billion in future expenses tied to this strategic shift. The Canadian plant originally slated to produce the electric SUV will now manufacture combustion engine-powered pickups, which are expected to be more profitable.
Battery Sourcing and Production Adjustments: To improve the financial performance of its EV business, Ford is enhancing its battery production in the US to qualify for tax credits under the Biden administration’s 2022 Inflation Reduction Act. This includes shifting some battery production for the Mustang Mach-E to Michigan and accelerating battery production for its E-Transit vans through its joint venture with SK On.
Focus on Cost-Effective EVs: Ford is on track to start producing lower-cost lithium iron phosphate (LFP) batteries in Michigan by 2026. These batteries, expected to qualify for tax credits, will power a new midsize pickup truck designed to be cheaper to own and operate than traditional internal combustion engine or hybrid models.
CEO Jim Farley emphasized that Ford’s approach to any new EV is centered around profitability, with a focus on ensuring that new models are profitable within their first year. The company plans to provide further updates on its electrification strategy in the first half of next year.
In summary, Ford’s strategic pivot reflects a cautious approach to the evolving EV market, balancing its investment in electrification with a focus on profitability and competitive pricing.
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