Amid recalls, Ford says costs to build Mustang Mach-E are skyrocketing

Despite steady consumer demand for new vehicles, Ford Motor is preparing for an economic downturn according to the company's CFO.

Even though Ford has seen record profits and strong demand for electric vehicles like the Mustang Mach-E, rising battery material costs and inflation are wiping out any potential profits for the new car. Despite the recent price hike of the Mach-E, this is still the case.

Increasing the price of the vehicle was enough to preserve Ford's profit margins, but not enough to affect the cost of commodities. The CFO didn't say how much money Ford is losing on each Mach-E purchase, but he did say that costs for the EV have increased.

Ford is recalling nearly 50,000 Mach-Es because of a malfunction that could cause overheating of the vehicle's battery high-voltage contactors, which can result in loss of power while driving and cause an accident. If the recalls become more involved than that, it could cost the company millions.

Will Ford be able to meet production and delivery goals over the next few years because of roadblocks like these? Ford had to stop new orders for the Mach-E in April due to a shortage of parts. The month before, it was announced that the EV unit would be separate from the engine business.

We are seeing challenges on the other side of the equation. Customers are making payments to Ford Credit, the automaker's vehicle financing arm.

Ford is taking a possible U.S. recession seriously and is prepared to follow a number of different approaches to previous recessions.

We have a lot of inventory. The order bank is significant at over 300,000 units. We are heading into this possible recession in a different position than we have ever been in before.