Ford takes $19.5bn hit amid electric vehicle retreat as Trump policies bite | Ford
Ford said Monday it would result in a $19.5 billion loss and discontinue several electric vehicle models; This marks the most dramatic example yet of the auto industry’s retreat from battery-powered models in response to the Trump administration’s policies and weakening EV demand.
Ford, headquartered in Dearborn, Michigan, said it will stop producing the F-150 Lightning in electric vehicle form but will shift to producing an extended-range electric model, a version of the hybrid vehicle called the Erev that uses a gas-powered generator to recharge the battery.
The company is also scrapping planned electric commercial vans, as well as a next-generation electric truck codenamed T3.
Instead, Ford said it will push hard toward gas and hybrid models and eventually hire thousands of workers, though there will be some layoffs at its jointly owned Tennessee battery plant in the near future. The company expects the global hybrid, extended-range EV and pure EV mix to reach 50% by 2030, up from 17% today.
Ford will first distribute the loss taken in the fourth quarter and continue through next year and into 2027, the company said. Approximately $8.5 billion is related to the cancellation of planned EV models. About $6 billion is tied to the liquidation of a battery joint venture with South Korea’s SK On, and $5 billion is tied to what Ford calls “program-related expenses.”
Ford’s shift reflects the auto industry’s response to declining demand for battery-powered models after auto companies poured hundreds of billions of dollars into EV investments earlier this decade. The outlook for electricity has diminished significantly this year as Donald Trump’s policies pulled federal support for electric vehicles and eased tailpipe emissions rules; This could encourage automakers to sell more gas-powered cars.
U.S. electric vehicle sales fell nearly 40% in November after the $7,500 consumer tax credit that had been in place for more than 15 years to stimulate demand expired on Sept. 30. The Trump administration included a freeze on penalties paid by automakers for violating fuel economy regulations in the massive tax and spending bill passed in July.
“Instead of spending billions of dollars more on big EVs that no longer have a path to profitability, we’re allocating that money to areas that generate higher returns,” said Andrew Frick, Ford’s president of gas and electric vehicle operations.
The F-150 Lightning rolls off assembly lines to great fanfare starting in 2022. Comedian Jimmy Fallon wrote a song about the truck. Ford increased production of the model to meet the influx of 200,000 orders, but sales could not keep up the same pace.
The company sold 25,583 Lightnings through November this year; This figure decreased by 10% compared to the same period of the previous year.
The successor to the F-150 Lightning, the T3 truck had to be built from scratch for production at a new complex in Tennessee and be a key part of Ford’s second-generation EV lineup. Ford is replacing production of EV pickups at its Tennessee plant with new gas-powered trucks starting in 2029.
Ford has effectively discontinued all of its announced second-generation EV models with Monday’s announcement.
For its future EV lineup, the company is focusing on more affordable EV models designed by the skunkworks team in California. The price of the first model of this team is planned to be approximately $ 30,000 and will be available in 2027. This midsize EV truck is built at Ford’s Louisville plant.
