Ford to Take $19.5 Billion Hit as It Scales Back Electric Vehicles

Ford Motor Company announced a major shift in its electric vehicle strategy this week, revealing plans to recognize $19.5 billion in charges as it cuts several EV models to reduce financial losses. Most of these charges will be recorded in the fourth quarter, while the rest are expected in 2026 and 2027, according to company statements.

The automaker will stop producing the all-electric F-150 Lightning pickup truck and will instead introduce an extended-range version. This new model will feature an electric motor for driving, supplemented by a small gasoline engine that recharges the battery. Production will continue at the Rouge Electric Vehicle Center in Dearborn, Michigan.

In a statement, Ford said it no longer plans to manufacture select large electric vehicles due to disappointing demand, high production costs, and recent regulatory changes. Instead, the company will shift investment toward hybrid vehicles, traditional gas-powered models, and higher-margin business areas, such as its new battery energy storage venture.

CEO Jim Farley explained that the pivot is based on changing customer demand. He stated, “The operating reality has changed, and we are redeploying capital into higher-return growth opportunities: Ford Pro, our market-leading trucks and vans, hybrids and high margin opportunities like our new battery energy storage business.”

By 2030, Ford expects about half of its global sales volume to come from hybrids, extended-range EVs, and battery-powered vehicles, up from 17% expected in 2025. For North America, the strategy includes smaller, more affordable EVs, with the first midsize electric pickup planned for assembly in Louisville, Kentucky beginning in 2027. Plans for an electric commercial van have been replaced with a model available in both gas and hybrid versions, set for production in Ohio.

To boost revenue from its existing EV battery investments, Ford is launching a new energy storage division. Existing battery plants in Kentucky will be converted to produce advanced battery storage systems for data centers, with a target of at least 20 GWh annually by 2027. The company will also use its Michigan facility to produce batteries for home energy storage.

This transition follows a period of declining government support for EVs. In November, Ford‘s EV sales dropped 61% after the removal of federal tax credits raised consumer prices. The company anticipates continued losses in its EV business through at least 2025. Other automakers, including General Motors, have also recorded large write-downs as they adjust their EV strategies.

In light of the changes, Ford raised its adjusted pretax earnings outlook for 2025 from up to $6.5 billion to $7 billion and plans to hire thousands of workers to support new projects. Market sentiment toward Ford‘s stock has turned bearish in recent days, as investors react to the revised strategy and financial impacts.

According to its announcement, Ford aims to achieve profitability in its EV business segment, Model e, by 2029. For more details, see the full company statement.

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