Ford’s $19.5B Shift from EVs to Hybrids
Ford Motor Company has taken a colossal $19.5 billion hit this week as it makes a significant shift from its all-electric vehicle (EV) strategy towards hybrid powertrains and more affordable EVs. The automaker has decided to cancel several of its high-profile electric models, including plans for next-generation large electric trucks, which were to be manufactured in Tennessee.
The charges include:
- $8.5 billion in write-downs of EV assets
- $6 billion related to the termination of a joint-venture battery operation with South Korea’s SK On
CEO Jim Farley revealed to CNBC that the high-end EVs, specifically those priced at $50,000, $70,000, $80,000, were not performing well in terms of sales. As a result, Ford is shifting its focus to hybrid vehicles and has plans to launch a $30,000 midsize electric pickup in 2027.
The F-150 Lightning, Ford’s flagship electric truck launched in 2022, will undergo a redesign as an extended-range electric vehicle. It will feature a gas-powered generator offering a whopping 700 miles of range. By 2030, Ford expects approximately 50% of its global volume to be hybrids, extended-range EVs, and fully electric vehicles, a significant increase from 17% in 2025.
Furthermore, the company has announced plans to invest $2 billion in a new battery energy storage business. This venture aims to supply data centers and the electric grid.
Source: CNBC