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Ford lays off 700 who were building electric version of F-150
- ultimoo 3y ago> so-called “sub pay,” which is paid by the companies. Together unemployment benefits and sub pay covers 74% of their normal pay while laid off. But the F-150 Lightning workers who are laid off will be eligible for both unemployment and sub pay I had no idea ford had to pay 74% in wages after laying off! For how long?
- thelastparadise 3y agoSounds more like a furlough than a layoff. Probably something negotiated by the union.
- csours 3y agoDisclosure: I work for GM. Anything here is solely my own opinion or understanding. Layoff means something different to automakers. It's a layoff so that they can draw unemployment. Traditionally there was a two week layoff in July for model changeover. It was basically a two week vacation for a lot of workers, while they were technically unemployed. So yes, it's more or less a furlough.
- ensignavenger 3y agoApparently as long as they are eligible for unemployment - https://www.natlawreview.com/article/advantages-and-challenges-supplemental-unemployment-benefit-plans https://www.natlawreview.com/article/advantages-and-challeng... Ford pays sub pay, and that combined with unemployment benefits is 74%, Ford doesn't pay the entire 74%. It is not unusual in factories like that to have weeks long temporary layoffs, do to reduced demand or shutting down to retool, so it makes sense for automakers to offer these types of benefits, rather than severence, which is more of a permanent seperation type of thing.
- linksnapzz 3y agoThe "jobs bank" concept, which all detroit automakers have a form of, has been going on for decades. You come to the factory, and play cards or watch TV, potentially for years, draw a paycheck and benefits...until you take your retirement. It was originally conceived as a way to make it less likely to offshore production: "look, you have thousands of workers you're already paying, just twiddling their thumbs! Give them some cars to build!" This has not quite panned out.
- csours 3y agoDisclosure: I work for GM. Anything here is solely my own opinion or understanding. The jobs bank went away in the 2009 bankruptcies/reorganization.
- linksnapzz 3y agoI was astounded the first time I read about it in the '90s; and even more so when it was still going on in 2006. The fixed cost of labor as a whole, and not just salary + benefits for a worker, but n workers at that rate, is daunting. Especially when it would be possible to build the same # of units with .25n workers.
- csours 3y agoDisclosure: I work for GM. Anything here is solely my own opinion or understanding. (Repeating because this is more opinionated) The bankruptcies weren't caused by one thing, but cost of labor was a large factor. Perhaps a bigger factor was the pressure to keep producing non-competitive, money losing products so as to maintain employment numbers. Unions do a lot for their members, and they should, but they cannot save a bad product. In my opinion, over-financialization was the other top factor. You can read "Bean Counters vs Car Guys" by Bob Lutz for an explanation of this.
- jmugan 3y agoI'm not a truck guy, but the Ford Lightning looks pretty cool. I wish it wasn't so expensive.
- thelastparadise 3y ago> I wish it wasn't so expensive And yet they're making a huge loss on each unit sold.
- redundantly 3y agoLoss? Are you thinking of Rivian?
- readthenotes1 3y agohttps://www.thestreet.com/technology/ford-loses-nearly-60000-for-every-electric-vehicle-sold https://www.thestreet.com/technology/ford-loses-nearly-60000... Ford as well
- redundantly 3y agoI'd read that link, but the ads on that site are cancerous. I didn't know Ford was also operating at a loss on their EV trucks as well.
- mikeyouse 3y agoIt's incoherent anyway - in the annoying way these analyst reports often are. Just confusing startup and presales costs with steady-state operations to claim they're losing massive amounts of money when it's obviously just the launch expense + engineering + prototyping amortized over the first few thousand cars they'd sold. By that silly measure, they've already cut "losses" to only $30k/sale.
- rtkwe 3y agoAll of those reports strike me as deceptive. The reports are just for the current state which include startup and R&D costs that will be recouped over the lifetime of that model.
- yardie 3y agoWho knew that $70k+ pickup trucks were also a 0% interest rate phenomenon.
- tcbawo 3y agoEven IC trucks are pretty close to 70k these days
- WillPostForFood 3y agoMany IC trucks are expensive, but the best selling truck, the Toyota Tacoma has a base price of only 28k. Realistically, they end up being mid-30s once outfitted by the dealer, but still a big value compared to the lightning.
- mikeyouse 3y agoTechnically the F-150 has a base price of $33k -- but in the real world, the ASP for one is north of $60k now. Similar to how the $28k starting-price Tacoma actually sells for north of $40k on average.
- kubectl_h 3y agoThe price is going up in '24 as well, by about 4k per model. However they are putting their Co-Pilot package (blind spot info system, collision detection, lane keep), extended range fuel tank and 12" screen standard across the board. This is bound to annoy fleet purchases but overall at 37K it's a nice truck at the basic trim level. The Co-Pilot stuff is good to have standard as it increases the safety of the big, unwieldy trucks.
- alephnerd 3y agoSome of those higher priced models are priced so business owners and the truck manufacturer can optimize for the Business Use Depreciation Deduction [0] [1] (and also convos with family friends) [0] - https://turbotax.intuit.com/tax-tips/small-business-taxes/business-use-of-vehicles/L6hi0zzzh https://turbotax.intuit.com/tax-tips/small-business-taxes/bu... [1] - https://www.crestcapital.com/section-179-deduction-vehicle-list-over-6000-lbs#section2 https://www.crestcapital.com/section-179-deduction-vehicle-l...
- thelastparadise 3y agoEVs are a cost center. So when the squeeze shows up, EVs are first on the chopping block.
- nine_zeros 3y agoEverything is a cost center. Producing anything takes money. If they don't want to pay anything, the company might as well pack up.
- thelastparadise 3y ago> Everything is a cost center Their gas/diesel trucks are definitely a profit center.
- asah 3y agosounds like an Innovator's Dilemma...
- DrBenCarson 3y agoNot for long
- epgui 3y agoNot fundamentally, they aren’t. Tesla and a few Chinese companies are making very good money on EVs.
- linksnapzz 3y agoTesla nor the Chinese have been doing business with the UAW for 50+ years; nor do they sit in the same regard with stock analysts as the detroit companies.
- kjksf 3y agoThose points are neither here nor there. Tesla has pretty much the best margin in car industry, even when comparing their pure EV production to traditional ICE cars. Pretty much all other companies, including Ford, loose money on EVs. Some loose more than others. The difference between Ford pay and Tesla pay is not even close to explain the profitability gap. It's more about Tesla making way more cars and therefore paying less for components and batteries and raw materials. It's about Tesla working on batteries for many years and jumping quickly on newer, cheaper batteries from CATL and BYD. It's about their cars being more efficient and therefore needing smaller (and cheaper) batteries. It's about vertical integration. It's about manufacturing advances like giga casting.
- bdw5204 3y ago> The UAW’s targeted strike at a total of five assembly factories at Ford, General Motors and Stellantis have prompted all three companies to lay off workers. In other words, this layoff seems to really be about pressuring the autoworkers union to end its strike.
- deleted 3y ago[deleted]
- lucidguppy 3y agoIf you need an electric truck - it shouldn't be as big as an F-150 - it should be more the size of a hilux. There needs to be two kinds of electric vehicles - 250 mile rangers and 150 mile rangers - and the 150 mile rangers need to use Sodium Ion batteries. Make them cheap - make sodium ion electric vehicles the cheapest vehicle on the road. Put 2013 tech in it outside of the drive train.
- rtkwe 3y agoElectric vehicles tend to wind up big because you need big batteries for infrequent but regular long trips like vacations or holidays. The median day can be covered by the tiny battery in a plug in hybrid but there's a reliable number of outlier days people don't want to mess with charging every 2 hours while juggling all the other stress on those longer travel days.
- Animats 3y agoFord is cutting back from 3 shifts to 2. Running 3 shifts is unusual in automotive. You need some downtime for maintenance. The thing is overpriced. It ought to be cheaper than the gasoline version, but it's not. The legacy automakers treat electric as a trim line - electric comes with every overpriced accessory they can load onto the thing. The base F-150 electric has dual motors and costs $50K. The base F-150 in gasoline costs $35K. There's still that $15K electric premium.
- bagels 3y agoWhy ought it to be? Batteries are still expensive.
- l33t7332273 3y agoAre they more expensive than motors? Maybe ford has good economies at scale already to make it up.
- csours 3y agoFor now, yes, a bit more.
- bagels 3y agoYes, they are more expensive than motors. The F-150 Lightning has ~100kWh of capacity, and last time I looked it up, batteries cost the manufacturer ~$140/kWh, so, $14,000 in batteries. I don't know what the motor costs, but if they're selling for $35k, I can't imagine the motor costs $14,000. Probably a lot less than this.
- throwaway894345 3y agoWhere did you find $14K? I'm seeing $35K for a replacement--is Ford really marking these up $20K / 250%?
- bagels 3y ago
- deleted 3y ago[deleted]
- bluejekyll 3y agoYou know what would be awesome, an electric minivan. The id.buzz looks great, but has low range and lacks a lot of nice amenities. The Canoo looks really great, but low range and I can’t tell if the company is actually ever going to produce their van. It seems like rivian has a platform that could make a great minivan, 400 mile range, maybe an adventure style one. Where’s the Chrysler all electric Pacifica? This is the class of vehicle that we need in my family.
- decafninja 3y agoThere probably isn’t one for the same reason minivans in general are unpopular. You could say the Model X is pretty close to being a minivan. Granted it’s nearly six figures in price.
- bluejekyll 3y agoOne of the things going on in the market is CAFE rules in the US encouraging trucks and suvs as it allows them to make a larger profit than standard pedestrian vehicles. The car companies market these vehicles very aggressively. I thought that was about gas engines, but because there are so many on the road now people want bigger vehicles to be “safer” from everyone else on the street, which is a vicious cycle. The minivan was very popular until car companies started pushing the suv as a way around CAFE. The thing we need to do is remove the CAFE exemptions for trucks, and this problem might start correcting itself.
- toast0 3y agoPretty sure we did remove CAFE exemptions for trucks and it made things worse. Unified CAFE standards by footprint mean small trucks are unsellable, a 4 cylinder, single cab, 6 foot bed truck is all the truck a lot of people need, but they don't get enough mpg for CAFE, so make it wider, longer, and give it a bigger engine, and make it taller while you're at it.
- bluejekyll 3y ago