Ford Motor is taking a major step back from its electric-vehicle ambitions, announcing roughly US$19.5 billion in charges largely tied to its loss-making EV operations, as the automaker pivots toward hybrids, extended-range vehicles and conventional gasoline models amid weakening EV demand.
The Wall Street Journal with the info. In brief:
The impairment is among the largest ever recorded by a U.S. industrial company and represents the clearest acknowledgment yet from Detroit that the transition to fully electric vehicles will take longer and be less profitable than previously expected. Ford has lost around US$13 billion on its EV business since 2023, underscoring the scale of the challenge.
In response, the company said it will redeploy capital away from unprofitable EV assets and refocus investment on gas-powered vehicles, hybrids and extended-range electric models that combine battery power with onboard gasoline engines. These powertrains are seen as more commercially viable given current consumer preferences, infrastructure constraints and regulatory uncertainty.
Ford’s revised strategy includes discontinuing the fully electric version of its F-150 Lightning pickup in favour of an extended-range variant, reflecting softer-than-expected demand for large EV trucks. While the company is pulling back from high-cost EV bets, it reiterated plans to launch a US$30,000 electric pickup by 2027, positioning low-cost EVs as the core of its future electric offering in the U.S.
By 2030, Ford expects hybrids, extended-range vehicles and EVs to account for around 50% of its global sales volume, up from roughly 17% today, highlighting a shift toward a more gradual, diversified electrification path rather than a rapid transition to pure EVs.
Beyond vehicles, Ford will repurpose its Kentucky EV battery facility into a battery-storage business, targeting customers such as utilities, renewable energy developers and data centres supporting artificial intelligence workloads. While the move will result in layoffs for about 1,600 workers at the site, the company said it plans to hire thousands of new employees across its broader U.S. operations.
Overall, Ford’s retrenchment reflects a broader recalibration across the auto industry, as manufacturers confront the economic realities of EV adoption and seek profitability over speed in the energy transition.
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Ford’s retrenchment is likely to reinforce investor rotation toward automakers with flexible powertrain strategies and nearer-term profitability. Legacy OEMs with strong hybrid line-ups and pricing power may be favoured over pure-play EV manufacturers facing margin pressure, subsidy risk and slower demand growth. The move also supports selective opportunities across auto suppliers tied to internal combustion, hybrid systems and battery-storage infrastructure, while tempering enthusiasm for capital-intensive EV capacity expansion.
This article was written by Eamonn Sheridan at investinglive.com.