Ford Motor Company (NYSE: F), on Thursday, released the first look of the ‘E-Transit,’ an all-electric commercial transit van.
Ford’s Commercial Business General Manager for North America, Ted Cannis, said that the vehicle could add to the company’s profitability, CNBC reports.
What Happened: The electric van is anticipated to arrive towards the end of next year. With the new E-transit van, Ford could be in a better position to further CEO Jim Farley’s target of maintaining a lead in its key commercial business segment -- CNBC.
In an interview with the Mad Money show host Jim Cramer, Farley said that Ford is different because it invests in commercial vehicles. “Our electric vehicles are going to bring electrification to the job site so people will be able to use that battery in the E-transit to power the job site,” he added.
Ford sells roughly 500,000 units of the Transit vehicles globally per year. Owing to the high demand for all-electrical commercial vehicles, the company plans to ramp up production for the all-electric pickup F-150 by 50%.
At a price cap of $45,000, the electric van would be more expensive than Ford’s gas-powered legacy models. However, the automaker claims that the electric models are more lucrative due to a 40% reduction in maintenance costs.
Why Does It Matter: Ford, in its second-quarter 2020 earnings, disclosed that it had spent close to $5.75 billion, half of the $11.5 billion committed budget until 2022.
Ford’s new van could be added to the delivery and maintenance fleet of e-commerce and logistics companies. Currently, Amazon Inc (NASDAQ: AMZN) and United Parcel Services Inc (NYSE: UPS) are exploring deliveries using drones and engaging environment-friendly vehicles with reduced carbon emissions to its delivery networks.
Price Action: Ford shares fell 1.44% to $8.14 on Thursday.