LONDON -- Ford Motor is rethinking its plan to sell only full-electric cars in Europe by 2030 as EV sales fail to take off in the region.
Ford in 2021 announced its goal of selling only battery-electric passenger cars in Europe by the end of the decade. The target was more ambitious than the European Union's plan to allow only zero-emissions cars to be sold after 2035 as part of its CO2 reduction strategy.
Ford now says it could continue to sell combustion engine cars after 2030 if buyers want them. "If we see strong demand, for instance for plug-in hybrid vehicles, we will offer them," said Martin Sander, head of Ford's passenger cars business in Europe.
Demand for electric cars was "softer" than Ford had originally planned, he said, and the company is not hitting its ambitious targets.
There is a clear trajectory to electrification, Sander said. "We just have to manage our way towards 100 percent electric drivetrains," he told the Financial Times Future of the Car summit on Tuesday.
Ford has completed a $2 billion investment to convert its factory in Cologne, Germany, to build full-electric vehicles based on Volkswagen Group's MEB platform. It will start series production of the Explorer all-electric compact SUV in Cologne in June and will unveil a second vehicle built on the MEB platform, also in June.
Later this year Ford will also reveal the Puma Gen-E battery-electric version of its best-selling small SUV built in Craiova, Romania. The automaker has also started selling electric versions of its Transit Custom one-ton van in Turkey despite a slower than expected take-up of EV vans.
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Ford is reducing its lineup of combustion engine cars as it focuses on EVs and its highly profitable light commercial vehicles business. It ended production of its Fiesta small car in Cologne last year, It will also cease production of the Focus car in Saarlouis in 2025.
The automaker has stopped building its Mondeo midsize car and Galaxy/S-Max minivans at its Valencia factory in Spain. Ford is considering building a new ‘multi-energy’ passenger car model in Valencia, which currently builds the Kuga compact SUV that is available in plug-in hybrid, full hybrid or combustion-engine versions.
"We have a plan for our plant in Valencia," Sander said.
Avoiding U.K. fines
In the U.K., its largest European market, Ford is seeking ways to avoid paying heavy fines under the country's zero emission vehicle (ZEV) mandate that aims to encourage sales of electric cars. The mandate stipulates that automakers must sell an ever-larger percentage of EVs every year, starting with 22 percent in 2024.
Sander said Ford will restrict sales of combustion-engine vehicles in the U.K. rather than push EV sales to meet the mandate.
"We are not going to pay penalties. We are not going to sell electric vehicles at huge losses just to buy compliance," Sander said. "The only alternative is to take our shipments of ICE vehicles for U.K and sell them somewhere else."
