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Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

America's Most Innovative Companies

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

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Industries included in the sector are autos and auto parts manufacturers.

Fortune Sector Leaders: Motor Vehicles and Parts

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G500-2023-Ford

For the fifth year in a row, Ford is the largest U.S. automaker by sales; it brought in $158 billion in revenue last year. 
<ul> 
 	<li>Ford dealt with slowed production as shortages of computer chips and other parts affected its vehicle assembly lines. It still hit some key goals, including producing its 150,000th Mustang Mach-E in November 2022.</li> 
 	<li>In March 2023, Ford announced the establishment of a subsidiary known as Latitude AI to develop automated driving systems. Latitude’s engineers are slated to collaborate with a team that previously worked at Argo AI, a joint venture among Ford, Volkswagen, and others that had shut down months prior.</li> 
 	<li>Ford reported a $600 million loss in China in 2022, where stiff competition from rivals such as BYD has cut into its performance. In May 2023, Ford announced that it would scale back investments and reduce costs across its Chinese operations.</li> 
</ul>

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500 2023-Ford

For the fifth year in a row, Ford is the top automaker on the Fortune 500; it brought in $158 billion in revenue last year. 
<ul> 
 	<li>Ford dealt with slowed production as shortages of computer chips and other parts affected its vehicle assembly lines. It still hit some key goals, including producing its 150,000th Mustang Mach-E in November 2022.</li> 
 	<li>In March 2023, Ford announced the establishment of a subsidiary known as Latitude AI to develop automated driving systems. Latitude’s engineers are slated to collaborate with a team that previously worked at Argo AI, a joint venture among Ford, Volkswagen, and others that had shut down months prior.</li> 
 	<li>Ford reported a $600 million loss in China in 2022, where stiff competition from rivals such as BYD has cut into its performance. In May 2023, Ford announced that it would scale back investments and reduce costs across its Chinese operations.</li> 
</ul>

Just as it dominates our economy, Big Tech now dominates Fortune’s annual ranking of corporate reputation.

World's Most Admired Companies

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

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F500 2022 Ford

After a difficult, pandemic-scarred 2020 marked by unit shutdowns, supply-chain issues, and a full-year loss in revenue, Ford Motor began slowly but steadily recovering in 2021. Revenue increased by 7.2%, and Ford’s total return to investors was 137.5% for the year. Even as it rebounded, Ford doubled down on an electric-vehicle future. It accelerated development of the Lightning F-150, an electric version of its bestselling pickup truck that analysts expect will be the first major EV pickup to hit the market when deliveries begin this year. The company is planning to invest as much as $20 billion in EV development over the next 10 years, and in March 2022 it announced that it would split into two units: Ford Model e, for EV manufacturing and development, and Ford Blue, for traditional internal combustion engine vehicles. Ford expects 50% of its global sales to come from EVs by 2030.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500-2021-047-Ford Motor

Ford’s global business was whacked by the pandemic, which forced plant closures, caused supply-chain backlogs, and reduced demand for new passenger vehicles. As a result, full-year revenues were down 19%, from $156 billion to $127 billion, and net income was negative $1.3 billion. North America and its credit division were Ford’s only profitable units; still, the company would have eked out a small profit overall were it not for a $1.5 billion pension charge. New CEO Jim Farley, who took the wheel at Dearborn in October 2020, will be banking big on the electric F-150 truck, announced in May 2021, to kick-start Ford’s EV program in earnest.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-21-Ford

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-031-Ford

Despite a $4.4 billion decline in revenues, Ford retains its position as America’s largest carmaker by revenue for a second consecutive year. The perennially strong performance of its F-series trucks is sustaining the company through an awkward transition in its passenger car lineup. In the next year, investors will be keeping an eye on market adoption of its electric Mustang Mach-E as well as the newly reborn Bronco SUV.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-012-Ford-Motor

Despite a $4.4 billion decline in revenues, Ford Motor Co. retains its position as America’s largest carmaker by revenue for a second consecutive year—the first time it has done so in the history of the Fortune 500. The perennially strong performance of its F-series trucks is sustaining the company through an awkward transition in its passenger car lineup. In the next year, we’ll be keeping an eye on market adoption of its electric Mustang Mach-E as well as the soon-to-be-announced rebirth of the Bronco SUV.

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

This year's Fortune 500 marks the 65th running of the list.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 64th running of the list.

Here are the World's Most Admired Companies for 2017 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune Global 500 generated $27.6 trillion in revenues and $1.5 trillion in profits.

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Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

The world's 500 largest companies generated $31.2 trillion in revenues and $1.7 trillion in profits in 2014. Together, this year's Fortune Global 500 employ 65 million people worldwide and are represented by 36 countries.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Nike, Cisco, MasterCard, SABMiller, Vodafone, Google—and 45 other companies that are doing well by doing good.

Change the World

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Sector

Industry

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Strongest Dimension

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Ford Motor, founded in 1903, was the second-largest automaker by revenue in the U.S. in 2024. It manufactures cars, trucks, and commercial vehicles, and owns the luxury car brand Lincoln. Ford entered the electric vehicle market in the late 1990s with its Ford Ranger EV and has since expanded its EV lineup to include the F-150 Lightning pickup truck, the Mustang Mach-E SUV, and E-Transit electric commercial van.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Ford Motor (F): Company Profile, Stock Price, News, Rankings

legacy

Ford Motor

ford motor

Good day, everyone. My name is Leila, and I will be your conference operator today. At this time, I would like to welcome you to the Ford Motor Company fourth quarter twenty twenty four earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session.

If you would like to ask a question during this time and if you have joined via the webinar please use the raise hand icon which can be found at the bottom of your webinar application. If you have joined by phone please dial 9 on your keypad to raise your hand. At this time, I would like

to turn the call over to Lynn Antipas Tyson, Executive Director of Investor Relations.

Thank you. Welcome to Ford Motor Company's fourth quarter twenty twenty four earnings call. With me today are Jim Farley, President and Chief Executive Officer and Sherry House, our new CFO effective tomorrow, February 6. Joining us for Q and A will be John Lawler, Vice Chair and Current CFO and Cathy O'Callaghan, CEO, Ford Credit. Today's discussions include some non GAAP references.

These are reconciled to the most comparable U. S. GAAP measures in the appendix of our earnings deck. You can find the deck along with the rest of our earnings materials and other important content at shareholder.ford.com. Our discussion also includes forward looking statements about our expectations.

Actual results may differ from those stated. The most significant factors that could cause actual results to differ are included on page 23. Unless otherwise noted, all comparisons are year over year. Company EBIT, EPS and free cash flow are on an adjusted basis. Lastly, I'd like to call out a near term IR engagement.

On February 11, Jim Farley and Jerry House will participate in a fireside chat in New York with Emmanuel Rosner at the Wolf Global Auto Tech and Mobility Conference. Now I'll turn the call over to Jim.

Thank you, Lynn, and hello, everyone. We appreciate that you're joining us. I want to start by welcoming Sherry House to her first earnings call as our incoming CFO, and I want to thank John Lawler as he transitions to our Vice Chair. Last year was a year of progress in key areas, building on our fundamentals at Ford. Our global revenue reached an all time record at the company of $185,000,000,000 This was our fourth consecutive year of top line growth driven by some of the strongest and most durable franchises in our industry.

Ford is the undisputed leader of pickup trucks in our industry. The F Series is once again America's best selling pickup and the best selling vehicle of any kind. The Ranger has grown into a strong global franchise for us. It's key to our profitability in many markets around the world at Ford. And by the way, Ranger won North America Truck of the Year.

That's the fifth time in a row Ford has won that award. Hybrid trucks are a key growth area for us. It's not what you think about when you think of hybrids, but this nontraditional channel is allowing us to capture the lion's share of revenue and command pricing power within the pickup truck market with unique features like Pro Power Onboard. Vans are another stronghold globally for us with our best selling transit family. And the story is no different for Pro as a whole.

Our commercial business is focused on unit sales and series mix to maximize revenue, and last year, we really saw that, a sizable growth in mix of profitable high series Super Duties and transit wagon. But at the same time, Pro is building something new, reoccurring revenue streams through our software and physical services business. Pro software subscriptions rose 27% to nearly 650,000 subscriptions last year. Telematics software grew 100%. Mobile service units increased 57%.

And the stickiness of that ecosystem of services is increasing. The second half of last year, 25% all of our brand new telematics customers in North America purchase additional software, including dash cams and fleet management software. And with BlueCruise, equipped units have now in operations have now more than doubled in the last year to just under 700,000 vehicles. And since launch, our customers have now driven over 300 miles 300,000,000 miles hands free. So you can see our relationship with our customers no longer ends at the point of sale or financing.

We're starting to build lasting relationships and creating new avenues for reoccurring growth at Ford. Last year, Ford had the highest share of revenue among all brands in our home market, The U. S. But the key for us is matching this revenue growth with improved execution and discipline on cost and quality. We're working differently and it's starting to show.

We've upgraded talent throughout our industrial system. We brought in industry's best third party experts to inspect and validate our findings. We're identifying best practices to attack our operational issues. We're quantifying the upside, and most importantly, we're bringing home the savings. We're changing our culture to be more focused on quality and with countable measures for all of our engineering teams and leadership.

These changes produce Green Shoots delivering about a $500,000,000 of net cost reductions in last year's second half. But this is frankly a small down payment on the work to be done at Ford. We're focused on closing our competitive cost gap over the next few years. And lastly, we continue to monitor and adapt to the changing market conditions, which last year unfolded about what we thought. The EV market, we continue to see new models launch, increased competition with increased pricing pressure.

On hybrids, we continue to see the market grow aggressively. But now in diverse markets like truck customers, we're learning that a hybrid can also mean uncompromised towing and torque and payload and other performance advantages, including fuel economy. In the ICE market, the industry's inventories and pricing have normalized. We also see the Chinese OEMs continue to expand and be a major force in our industry. Their operational fitness is incredible.

Their supply chains are now expanding globally and they're increasing their exports around the world. So let's talk about this year. We expect the company's adjusted EBIT of $7,000,000,000 to $8,500,000,000 range. Sherry is going to get into the details. We want to be clear though that our guidance has not factored in impacts from changes in policy by the current administration.

That said, from an operational standpoint, we believe a few weeks of tariffs are manageable given the rate and flow of our products. As everyone is aware, we're already seeing changes in trade policy and we expect changes in tax policy like the IRA and emissions policy CO2 that could be very consequential for our industry. At this early point, I want to emphasize a few things. There is no question that tariffs at 25% level from Canada and Mexico, if they're protracted, would have a huge impact on our industry with billions of dollars of industry profits wiped out and adverse effect on The U. S.

Jobs as well as the entire value system in our industry. Tariffs would also mean higher prices for customers. We said that we believe based on our conversations in DC with the Trump administration and congressional leaders that they are committed to strengthening, not weakening our nation's auto industry. That is certainly our expectation. And we look forward to working with our leaders to make sure that that becomes a reality.

Because they understand and appreciate how vital our industry is to jobs, the economy, our national security and the communities across our country. As America's leading auto producer and the leading exporter of automobiles, we applaud the administration for their agreement they announced with Mexico and Canada on Monday and we're closely monitoring the situation in China. There is a fundamental transformation happening in the backdrop of these policy changes in our industry globally. Of course, the overall tariff and trade situation, the growing importance of digital vehicles, the Chinese OEMs growing to become a global reality, these dynamics will all play out for some time to come, but Ford controls its future. While we are certainly operating interesting times, at the end of the day, we control our destiny.

Our products and services are compelling and get even stronger this year with great new launches like the Expedition, the Navigator, the all new electric Puma, as well as Ford Pro service offerings. We will match that potent revenue power with real progress on cost. To realize this multibillion dollar upside opportunity on cost, we will stay focused on the following areas: faster identification of defects and issues in the field deploying dedicated teams into our supply base to help them improve key manufacturing disciplines to improve their part quality to us, holding suppliers accountable when they send us defects, reducing complexity to eliminate waste, dramatic increase in our OTA capability. We performed 9,000,000 over their updates in fourth quarter alone, 80% of those were focused on addressing customers' concerns and warranty. We're enhancing our software development process.

For example, more upfront experts reviewing coding, not just ours, but our suppliers to catch potential issues early. And we're continuing to integrate AI, data analytics and other tools and process to further improve our manufacturing efficiency. Early input metrics provide us confidence in our 2025 cost reduction target. We already have over $1,000,000,000 of product design cost reduction ideas to be implemented this year. We have fewer lost units during our launches.

The improvement in the number of days from warranty defect and field fix is an encouraging sign for us in warranty. We're seeing an 18% improvement in the quality of our vehicles leaving our facilities for the twenty five model year launches. And we're increasing the number of supplier technical assistance site visits for critical suppliers. I want to touch on our EV strategy since it's so critical for any car company. We're on course.

We're deep in the development of our next generation of vehicles that we believe will be affordable, high volume and great for our business. On The U. S. Retail side, the sweet spot that has emerged is small and medium sized trucks and utilities. These vehicles use case fits perfectly for EVs, daily commuters, well suited as the second vehicle in the household.

They require smaller, much lower cost batteries. These vehicles can be offered at lower prices to help adoption of EVs for the customers who really appreciate the lower operating cost. But for larger retail electric utilities, the economics are unresolvable. These customers have very demanding use cases for an electric vehicle. They tow, they go off road, they take long road trips.

These vehicles have worse aerodynamics and they're very heavy, which means very large and expensive batteries. Retail customers have shown that they will not pay any premium for these large EVs, making them a really tough business case given the expense in the batteries. For Ford,

our commercial customers do show potential for large EVs. They're willing to pay a premium over ICE because they can really measure the TCO advantages of EV and they can live with depot charging. They don't have the same range anxiety that retail customers have. Profitability for these larger family haulers that take long trips will be more frequently occurred through partial electric options. Yes, PEV, but especially hybrid and E Revs that on one tank of gas can get over 700 miles of range, but still drive most miles all electric.

Ford will be developing flexible body on frame and unibody platforms that will be designed for these multi energy powertrains that are needed given the realities of customer affordability and range requirements. We are in the heart of our transformation of Ford. My optimism comes from our improved execution and our commitment to delivering on Ford Plus, creating a more dynamic, more capital efficient, higher margin company. Now I'd like to hand it over to Sherry to walk you through last year's operating performance and an outlook for this year.

Great. Thank you very much, Jim, and greetings to everyone on the call with us today. We really appreciate you taking the time to get a current update on the business. Before I get started, I want to personally thank John Lawler, Jim, and the entire Ford team for their incredible support over the last several months as I've ramped up in this new role. I'm very excited for the opportunity, and I'm especially excited for the future of Ford.

Twenty twenty four was another important year for us as we continue to execute against the Ford plus plan. We finished the year with global wholesales up 1% to 4,500,000 units, supported by growth in Ford Pro. Revenue increased 5% to $185,000,000,000 and we delivered 11 quarters of top line growth. Our strategic decision to offer retail and commercial customers freedom of choice through a compelling portfolio of products continues to pay off. We delivered $10,200,000,000 in adjusted EBIT with a margin of 5.5%.

Adjusted free cash flow was $6,700,000,000 and our cash conversion rate was 65%, above our target range of 50% to 60%. Our balance sheet is strong, with more than $28,000,000,000 in cash and close to $47,000,000,000 in liquidity. We believe it's prudent to have extra cash on hand during this dynamic time in the industry, marked by evolving customer needs, regulations in a fluid macro environment. Excess cash also provides us the opportunity to strategically pursue adjacencies in signature partnerships that would be accretive to our growth and ROIC. We hold ourselves accountable to strong capital discipline as we continue to efficiently invest in our future with plans to consistently reward our shareholders with 40% to 50% of free cash flow.

Over the past three years, we've paid out over $10,000,000,000 to our shareholders, and today I'm pleased to announce that we declared our first quarter regular dividend of $0.15 per share, plus a supplemental dividend of $0.15 per share, payable on March 3 to shareholders of record on February 18. Now let us take a closer look at our segment performance. Strong demand in super duty chassis cabs and transit wagon helped to lift Ford Pro's revenue by 15% to $67,000,000,000 while wholesales were up 9%. Full year EBIT was $9,000,000,000 with a margin of 13.5. Software and physical services represented 13% of Pro's EBIT.

Ford Pro Intelligence continues to drive recurring, high margin, non cyclical revenue. Paid subscriptions, attachment rate, and monthly average revenue per unit were all up strongly in 2024. The Model e team, where I've been spending a lot of my time, did a tremendous job delivering $1,400,000,000 in cost reductions last year, net of a $100,000,000 increase in spend to launch our new battery plants in next gen EVs. This cost performance was particularly important given industry pricing pressure, which resulted in year over year reductions in revenue and wholesales of 359% respectively. Model E remains focused on continuous improvements in gross margins and disciplined capital allocation that will drive profitable growth in the future.

Ford Blue's full year revenue was flat due to positive net pricing, which offset a 2% decline in wholesales, driven by the discontinuation of low margin products. EBIT was $5,300,000,000 with a margin of 5.2% and includes a positive impact to building stock in our home market. In 2024, our blue investment strategy mirrored customer demand with significant investments targeted at the next generation of our most iconic brands such as F Series and Explorer, and is also focused on bringing multi energy solutions, particularly hybrid powertrains across a broader part of our product portfolio. Ford Credit generated earnings before taxes of $1,700,000,000 for the year. So let's turn to our 2025 outlook.

For the full year, we expect company adjusted EBIT of $7,000,000,000 to $8,500,000,000 adjusted free cash flow of $3,500,000,000 to $4,500,000,000 and capital expenditures of $8,000,000,000 to $9,000,000,000 Relative to tariffs, the precise impacts of new tariffs would depend on a number of secondary and tertiary effects, such as price elasticities, how our Tier one and Tier two suppliers react, substitution effects, possible duty drawbacks, and so on. Other potential changes in policy, such as changes to the consumer tax credit or CTC, commercial and production tax credits or PTC, would also be harmful. However, the impacts of such changes are much smaller for Ford in 2025 than later years. For example, PTC will become a more meaningful benefit for us later this year with the launch of our Bosch battery factory. And for the longer term, '27 and beyond, changes to these programs would be very material.

Hence, we continue to stay in close contact with the administration to support a strong auto sector into the future. Our full year outlook assumes headwinds related to market factors. We're planning for lower industry pricing of roughly 2%, driven by higher incentive spending throughout the year. For Ford, we expect this will be partially offset by top line growth from upcoming launches. We expect these headwinds to be partially offset by about $1,000,000,000 of net cost reductions, primarily coming from lower warranty expense and material cost.

Our team is aggressively working to deliver more than $1,000,000,000 which would likely lift us to the higher end of our guidance range, And we expect the majority of these savings to occur in the second half of the year. From a calendarization perspective, we expect our first quarter adjusted EBIT to be roughly breakeven. This sequential decline in EBIT versus the fourth quarter of twenty twenty four is more than explained by a reduction in wholesales and unfavorable mix, including the impact of launch activity at major U. S. Assembly plants, including Kentucky truck and Michigan assembly plants.

Our plans to utilize Oakville for our next major truck launch will help us better optimize production stability during major launch periods, a benefit we highlighted to you when we announced the repurposing of that manufacturing facility. We expect a more normalized adjusted EBIT in the second quarter with a plan to hit our underlying EBIT level in the second half as cost improvements tied to lower material cost start to accrue to the bottom line. To help you better understand this calendarization and the levers for each quarter, we have included a full year 2025 bridge for you in our earnings deck. Our segment outlook anticipates another strong year at Ford Pro with EBIT of 7,500,000,000 to $8,000,000,000 at target margins. The fundamentals of Pro's business are strong, especially super duty chassis cabs and transit wagon in North America and the transit family in Europe.

And we continue to grow our mix of profitability coming from software and physical services globally. We expect a loss of $5,000,000,000 to $5,500,000,000 for Ford Model E, holding losses stable year over year. While continued industry pricing pressure remains, we plan to materially increase our global volume, driven by the full year impact of European launches, and we significantly increase investment in our battery facilities and next generation products, which are just two years away. The team started the year with a strong pipeline of cost savings ideas, which together with the launch of our BOSC Battery JV later in 2025, enables meaningful savings through eligibility of the production tax credit. And for Ford Blue, we expect EBIT of $3,500,000,000 to $4,000,000,000 reflecting lower volume and unfavorable mix, driven by the non repeat of last year's stock build and anticipated adverse exchange, partially offset by several cost reductions initiatives that are already underway.

Cost remains our largest value unlock to achieve Blue's margin target. Lastly, Ford credits, EBT will be about $2,000,000,000 Our performance in 2024 demonstrates the positive progress in our four plus plan, capital discipline, the right product portfolio, and consistent cash generation to reward our shareholders, customers, and employees. Importantly, I see us working differently as a company. Evidenced by our second half cost progress, we are carrying forward that higher level of discipline and execution into 2025, commensurate with our goal to deliver at least $1,000,000,000 of net cost reductions this year. We're relentlessly working to make our business better, and we remain highly focused on improving both quality and cost.

That concludes our prepared remarks, and I'd now like to open it up to your questions.

We will now move to our question and answer session. If you have joined via the webinar, please use the raise hand icon, Our first question comes from the line of Dan Levy with Barclays. Please go ahead.

Hi, good evening. Thank you for taking the questions. Wanted to double click on your commentary first on calendarization of earnings throughout the year. In the first quarter, you have to assume, I think, something like a 25% volume decline to get to breakeven. If you could just talk through that, you know, what's the confidence of recovery in subsequent quarters?

Is it volume? And then should we expect inventory to be fully rightsized by the end of the first quarter?

You'll go quick. Yeah. Okay. So as I talked about for for the year over year, you know, you're you're really seeing, the pricing come in and also the net net, cost improvements year over year. But when you go for just the first quarter, what you're seeing is largely the impact of wholesales that are coming down in the non recurrence of a stock build that's happening.

We also see adverse exchange, primarily in Argentina, Brazil, and Turkey. So that's really what's happening in that particular quarter.

Dan, quarter over quarter, our wholesales are down almost 20%. Okay. So it's really clear what's going on, our launches. And the question is, where are we on a day supply for a growth stock? We're in good shape.

We'll be in good shape after the first quarter, even actually gets leaner after the second quarter. I think we finish

That's right. So we finished the year at about 620,000 gross units, and that came down about 5% in January. And we expect that with this activity that's happening in the factories, where it's impacting Super Duty, Navigator, Expedition, that that may come down a bit more as well.

Like 40,000 units. So it's a very large reduction in the first quarter and we're planning another reduction in Q2 again. So we'll be right where we want. Our dealer day supply for our sales will be right in that mid-fifty range, which is exactly where we want to be as a company.

Great. Thank you. As a follow-up, Jim, you frequently talked about the critical nature of EVs. You actually gave a very long blog post on this over the summer. But I think we also know that your strategy is in part driven by compliance.

So we've heard president Trump talk about, you know, pulling back the, so to speak, EV mandate. How should we think about your EV plans and resource allocation in this environment? And to what extent would you maybe revisit timing of Skunk Works or the next gen Lightning, which I believe are planned for 2H27 given the changing environment?

Well, we're really confident of our EV strategy because, believe it or not, most things that are happening are kind of playing to our strengths. We believe that if the EPA or the California waiver is pulled, if there's some change to the CO2 regime in The U. S. Starting from '27, by the way, the next two years nothing happens, so it will be '27 and beyond. We believe that that will still be some kind of modest CO2 improvement required.

But more importantly, EVs are 8% of The U. S. Industry, they're growing, the satisfaction with the vehicles is higher than combustion and people who buy these vehicles don't go back to combustion for large parts. So this is a very vibrant market. It's also a global capability for Ford.

Given what's happening around the globe, this is not just happening in The U. S, it's happening everywhere. This capability of making money in high volume EVs, getting new customers is going to be a global capability. So that's why it's strategically important for us. Actually in this kind of environment, the Skunk Works platform becomes more important.

It's more affordable for customers. Let's say that CTC goes away. In that environment, without a leasing advantage, for example, more affordable on the actual cost of the vehicle becomes more important, not less. So I would say our bet a couple of years ago to build that platform, I think winds up being, well, we'll see, but winds up being a good move. We have to we have made some decisions on the three row and others and we will continue to make adjustments.

We are not shy about our lower capital ambition as a team. And we are we're going to make sure that the EVs we produce are not Me Too products, that they play to our strengths. And we know commercial EV customers are out there. We know that they like these vehicles. So those are our two big bets.

We can make changes to our lineup. We don't see that at this point in time. But we as we've said, we're not shy about making those adjustments. We need to, Dan. Does that make sense?

Yes. Thank you. That's really helpful, Pavel.

Your next question will come from the line of Daniel Rosca with AllianceBernstein. Your line is open. Please go ahead.

Hey, good evening. Thanks for taking the questions. And Sherry, welcome again. Jim, let me start kind of with a quite strategic question. It seems like the business is facing a level of uncertainty not seen before.

Maybe that's I hope that's fair, both from the strategic challenges you mentioned, but also kind of from the policy and the rapid change in domestic policy. As you guide forward kind of through this choppy water, what are some of the convictions or guiding principles kind of that still hold true in this environment? And what are some of the principles or convictions where you and the Board had to go back and kind of say, well, we'll have to take a look at that or that's become a little bit more uncertain. So we kind of just trying to understand how your thinking is making decisions in this environment. What can you rely on and where do you need to kind of exercise extra caution?

Thank you. Well, first of all, the cost journey that Ford is on is non negotiable. It is absolutely mission critical and controlled by the company. No one else controls that, it's us. So, we want everyone to understand how serious and how prepared we are to take out cost of business without and improving quality at the same time, which often can become at odds with each other.

So that is a guiding principle for Ford Motor Company, I hope forever. Within that, it's very clear that customers and regulators and leaders around the world are expecting our industry to bring down prices and make affordability more a priority for car companies. So one of the second big principles is we are going to invest in affordable vehicles, but we have to do it profitably, which means a transformation at Ford. You can see the transformation we've had to take on the EV platform with Skunk Works. We will have to take the same type of approach on body on frame and new to body multi energy platforms.

That's why I mentioned it. That's the second thing. We want to make sure that we have diverse powertrains. That's another really important principle for us. Because we've learned actually, when it wasn't popular to invest in hybrids, that it turns out to be a good move.

And therefore, we want to lean into eREBS and other new powertrains to make sure that we go with the flow, so to speak, of the customers. I think the last one is, I have never in my forty years had a chance to have reoccurring revenue where the company is not as susceptible to economic cycles and gas prices. And we can do that with Ford Pro. I think Ford Pro is leading this industry in showing large scale services, both software, almost a million subscriptions now, and it's getting sickies. So we can start to see the five wheel turn on Pro.

And we're just getting serious about repair of the vehicles. Those two attaches to our traditional vehicle, is frankly what I've been waiting for forty years to do as a leader for the company and for the industry. And how ironic it is, it's happening not in the retail world, it's happening in the pro B2B space. Those are the principles that we hold dear at the company. And probably the most important for me is the best talent and the best culture.

Because none of that is going to happen unless you get the best people in the company, which we continue to upgrade our industrial team and our technology team, and to have a sustainable culture where quality and cost never go out of fashion. And we have a lot to execute to do all those things, but those are our kind of four or five key principles.

Thanks. And then maybe more tactical for Sherry on the guide for Model E in 2025. Volumes in Europe are higher, PTC is coming in in H2, lithium prices are coming down, you're doubling down on cost efforts, yet the guide is flat. Could you kind of help us close that bridge? Kind of where do you see the weakness in Model E this year to kind of, you know, offset those gains and improvements you're making?

Yes. So we're making improvements. So the the Gen one products are still not profitable. What's really interesting about this though is that we're able to hold flat while you're increasing the volume significantly. The other thing that's going in there is the $1,000,000,000 of additional costs that are related to our BOSS battery factory as well as, related to our Gen two products.

So that $1,000,000,000 is about, it's about half engineering and about half in in, the Bosque Bosque area as well. And that's about a half a billion more than in the past. So one of the questions that you asked about was, just what's kind of going counter to that. So that would be some of the downward pressure that you continue to see that's on on the the pricing, potentially in Europe, potentially in North America. What's been great though is Model e as it landed q four last year.

The Mach e, we had a fantastic selling over 30% increase quarter over quarter, and we stayed above the average transaction prices. So while we're seeing the pressure, we have been continuing to do well even with our Gen one products and our sales pace.

Our next question comes from the line of Adam Jonas with Morgan Stanley. Your line is open. Please go ahead.

Thanks, everybody. So, hey, Jim, we've heard that you really, really like the Xiaomi SU7.

Which is, you know, is the their first car. So and I'm I'm just thinking when a country like The United States puts a % import tariff on another country that isn't even selling vehicles here yet, that's kinda talent. Do you think that US tariff policies will be successful in keeping Chinese EVs out of The US market long term? I'm just curious what you think like I mean because especially given your experience coming working at Asian Automaker before, like we've seen this movie in the 70s and 80s, you really think you think the Chinese come here or that we keep Mao? Is that good?

Thanks, Adam. Tom Freeman wrote a really interesting piece on this topic that I think is really pertinent for us. In the end, the level of subsidies that these companies have in China is not is very material, as well as these are digital vehicles with digital footprints and really deep, into people's digital life. So we have to have the right policies around privacy, the right privacy policies around national security because these are not the cars of old. They're data collection machines.

On the kind of unfair part or the subsidy part, I think we will have to sort that out as a country, because they're part of the competitive environment that, you know, when you list the kind of advantages the companies have, it's like a page long, right? So we have to resolve that. But in the end of the day, Adam, what I learned after forty years in this industry is the company has to stand on its own, you know, toe to toe with the cost of those companies and the product appeal of those companies. So I guess what I'm saying is we need to work with our government partners to make it a level playing field as much as possible. But in the end of the day, it's management's responsibility to beat the SU7 straight up in a street fight.

Got you, Jim. Thanks. Just as a follow-up, autonomy hasn't come up really much in your prepared remarks. And I find that interesting given all the attention around AI, Gen AI has put the autonomous vehicle theme on a totally different shot clock.

were clearly very wise to pause and restructure the Argo initiative, in hindsight. But I mean, Ford has, like, I think you guys in The US alone, you got 40,000,000 vehicles on the road driving a billion miles a day, probably more than that, a billion miles a day, Jim, and the data from that swarm is just insane. So I hear you on service bays and Ford Pro, and that's all great, and we understand that on the physical services, but what's the strategy around AI and autonomy really? Because I think many argue that if you're an industrial company or auto company like Ford, you either have an AI strategy or you don't have a future. I don't know if you agree with that, but how confident are you in Ford's leadership position and autonomy?

And what changes that? Is Sherry going to have to pay for that in house with an in house effort? Or is now the time to partner? Thanks, everybody.

You got it. I think we're at that point where we have to decide. Look, level three is around the corner. We're now BlueCruise is now over 300,000,000 miles. Customers are still paying for it.

We did drop the price, by the way, so it is getting commoditized to some extent, but but it is still a great opportunity. But the capability in the company is growing. All those Argo people that came with Ford, they are developing a really nice level two, level three system that we think will be among the best in its execution. We may not be the first. We may not grab all the headlines, but look at Brutkus.

Brutkus is continuing to win all the consumer awards for the best operating system on level two. Level two plus is around the corner. Level three, we think is a huge unlock on highway miles, eyes off. I think we're in good shape with our internal capabilities. But look, we're not so pollyannish about our own capability that we're not going to look at other people's system or not believe that level four personal autonomy is going to be interesting at some point.

They're making a lot of progress over there in level four. And it is time for us, not just in The U. S, but globally, they're looking at and that's why we made some of the announcements we did today because we need a strong strategy team to decide, do we partner, do we continue to ride our own team into this level four personal autonomy? And I think you're gonna find just like our move on Argo will be thoughtful and practical. We won't get in love with the size of the market.

We'll make a practical decision. And I think we'll be well positioned. I'm very confident in Sami and Doug and their technical prowess. They know the FSD system, they know what's out there, they know the Waymo system as it gets democratized for level four, individual level four. And so I think we'll make a good decision.

But I think, Adam, we're a lot closer to that partnering decision at Ford.

Your next question comes from the line of Emmanuel Rosner with Wolfe Research. Please unmute and ask your question.

Great. Thank you. My first question is around your plans for cost savings this year. So net $1,000,000,000 improvement. Can you give us a little bit more color around what the drivers are for that, the buckets?

And, you know, how do we acquire confidence that, this will be the year where we see, visibly a net cost improvement, at Ford? Because if I'm looking at your guidance, seems like in the second half of this year, you're probably now guiding for earnings growth despite fairly large cyclical headwinds that are assumed. So that sets a high bar for cost execution. So how should we think about the visibility into delivering this execution?

Yeah. Thanks for the question. So why we've got confidence going into this year is the approach that we took to building the business plan was very granular. We went through all areas of our business, and we're we're targeting efficiencies across all areas of our business. But there's two in particular that we're extra focused on.

And in Jim's prepared remarks, he also talked about the fact that we're really zoning in on material cost and warranty. And in fact, we're even getting outside third party support to be able to look at benchmarks, what is best in class, and what are all the different ways that we can make that even stronger. So it's because of those detailed plans that sit behind those items that we have more confidence. The other thing I would say is that on the design costs, we are entering this year with about 90% of our pipeline filled. And let me just double click on what I mean by that.

So as we think about the cost savings that we wanna make from a product design perspective, we have already identified those and we've characterized when in which quarter those are going to be introduced into new products. So that gives us a lot of visibility as to when we would expect to see those cost savings be realized.

Ford Motor (F) Q4 2024 Earnings Call Transcript

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