Ford Scales Back Electric Vehicle Strategy, Braces for $19.5bn Financial Impact
Ford Motor Company has announced a significant shift in its electric vehicle strategy, scaling back plans to build large battery-powered models as it pivots toward hybrids, petrol-powered vehicles and smaller, lower-cost EVs.
The US automaker said the change will result in a $19.5bn (£14.6bn) hit to profits, citing weaker-than-expected consumer demand for electric vehicles, rising production costs and recent changes to US regulations under President Donald Trump.
In a statement released on Monday, Ford said the commercial rationale for aggressively expanding large electric vehicles had diminished. “Lower demand, high costs and regulatory changes have reshaped the operating environment,” the company said.
Chief executive Jim Farley described the move as a response to customer behaviour and market realities. “This is a customer-driven shift to build a stronger, more resilient and more profitable Ford,” he said, adding that the company would redirect investment into trucks, vans, hybrid models and its energy storage business.
As part of the revised plan, Ford confirmed it will not move ahead with a fully electric version of its best-selling F-150 pickup. Instead, the F-150 Lightning will be reworked into a hybrid model that includes a petrol-powered generator. The company also said it is cancelling plans for a new electric van, opting to prioritise gas-powered and hybrid alternatives.
Ford’s announcement follows similar moves by rivals amid a slowdown in EV uptake in the United States. General Motors said in October it would scale back its own electric ambitions, taking a $1.6bn charge as demand softened.
Industry analysts note that EV adoption in the US has lagged behind markets such as China and parts of Europe, in part due to reduced government support. A federal tax credit that had lowered the cost of some electric vehicles by up to $7,500 (£5,608) expired in September, dampening demand.
The Trump administration has also rolled back several Biden-era policies aimed at accelerating the transition to electric vehicles, including stricter fuel economy standards. Earlier this month, President Trump announced plans to ease those rules, reversing targets that were expected to cut hundreds of millions of tonnes of carbon emissions by mid-century.
Mr Farley welcomed the regulatory changes, describing them as “aligned with customer demand,” though environmental groups have criticised the shift as harmful to public health and climate goals.
The policy reversal in the US comes as the European Union prepares to soften its own plans to effectively end sales of new petrol and diesel cars by 2035, following pressure from countries such as Germany, which argue that domestic manufacturers face intense competition from Chinese rivals.
