Ford said Monday it expected to take about $19.5 billion in charges as it retreats from the electric vehicle business, a massive hit as the automaker pivots to traditional gas vehicles along with hybrid and plug-in hybrid models in place of EVs.
The Wall Street Journal reports that in a stunning blow to the U.S. auto industry’s ambitious EV plans, Ford Motor announced on Monday that it expects to incur approximately $19.5 billion in charges, primarily due to its struggling electric vehicle business. The staggering write-down marks the largest impairment taken by a company in Detroit’s history and underscores the challenges faced by automakers as they grapple with lackluster demand for EVs.
Faced with mounting losses totaling $13 billion in its EV division since 2023, Ford has decided to shift its strategy, focusing on bolstering its lineup of gas-powered vehicles while transitioning to hybrid and extended-range electric models that incorporate onboard gasoline engines. The move aims to pull back from loss-making assets and redirect capital to more profitable models.
Ford CEO Jim Farley acknowledged the necessity of the pivot, stating, “Instead of plowing billions into the future knowing these large EVs will never make money, we are pivoting. We now know enough about the U.S. market where we have a lot more certainty in this second inning of reduced-emissions powertrains.”
Under Farley’s leadership, Ford aggressively pursued the EV market. This was in part driven by the economics of EVs, which automakers thought would be much more profitable than traditional gas-powered cars. Breitbart News previously reported on Farley bragging about how much less an EV would cost the company to build:
“Half the fixtures, half the work stations, half the welds, 20% less fasteners. We designed it, because it’s such a simple product, to radically change the manufacturability,” said Farley.
Farley stated that in an effort to compete during the incoming price war, Ford is ready to cut distribution costs and advertising.
As part of its revised strategy, Ford will halt production of the all-electric version of its flagship F-150 pickup truck, known as the Lightning. Instead, the company will focus on an extended-range version of the truck. Ford remains committed to producing a $30,000 EV pickup by 2027, which it says will be the cornerstone of its new low-cost EV lineup.
Looking ahead, Ford projects that by 2030, roughly half of its global volume will consist of hybrids, extended-range vehicles, and EVs, up from the current 17 percent. This acceleration towards hybrids reflects a growing recognition within the industry that these vehicles offer a more affordable and practical option for consumers hesitant to fully commit to pure EVs.
Read more at the Wall Street Journal here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
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