Ford Motor announced a $19.5 billion US writedown and the discontinuation of several electric vehicle models, marking a significant industry shift away from battery-powered vehicles in response to changing policies and declining EV demand.
The Michigan-based company revealed plans to replace the fully electric F-150 Lightning with a new extended-range electric model featuring a gas-powered engine for battery recharging. Additionally, Ford will be scrapping a next-generation electric truck, known as the T3, along with electric commercial vans.
Ford’s CEO, Jim Farley, stated that market shifts prompted the decision to pivot towards gas and hybrid models, with a goal to increase the global mix of hybrids, extended-range EVs, and pure EVs to 50% by 2030, up from the current 17%.
The company anticipates spreading the writedown over time, primarily impacting the fourth quarter and continuing into 2027. The $19.5 billion charge includes $8.5 billion related to the cancellation of planned EV models, $6 billion from exiting a battery joint venture with SK On, and $5 billion in program-related expenses.
Despite some layoffs at a Kentucky battery plant in the short term, Ford plans to hire thousands of workers while increasing its adjusted earnings before interest and taxes guidance for 2025 to around $7 billion.
Ford’s strategic realignment reflects broader industry trends, as automakers reassess their EV investments following policy changes under the Trump administration that reduced federal support for EVs and eased emissions regulations, favoring gas-powered vehicles.
Sales of electric vehicles in the US declined approximately 40% in November after the expiration of a long-standing consumer tax credit and regulatory changes that favored gas vehicles. This shift has prompted automakers like Ford to refocus on gas and hybrid models, scaling back their EV portfolios.
In this evolving landscape, traditional automakers like General Motors and Stellantis are also adjusting their EV strategies, emphasizing hybrids and streamlining their electric offerings. Ford aims to introduce more affordable EV models, starting with a $30,000 midsize electric truck in 2027, as part of its renewed focus on profitability in the EV sector by 2029.
The company plans to repurpose its battery plants in Kentucky and Michigan for energy storage systems and production of batteries for its upcoming EV models, as it navigates the changing dynamics of the automotive market.