The company expects to take special charges and write-downs related to the decision, totaling $1.9 billion. The company’s decision comes at a time when slowing demand for electric vehicles has led several automakers to re-evaluate and, in some cases, abandon their electric vehicle (EV) projects.
Instead, Ford will focus on producing two new electric pickup trucks and a commercial van, with the goal of making these vehicles more affordable, with greater range and profitability within a year of their arrival on the market, according to a Reuters report.
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The shift in focus comes as Ford battles losses on its current electric vehicle lineup, having reported a $2.46 billion loss in the first half of the year on its electric models. This has put pressure on the company’s overall profitability, which has been supported by its commercial vehicle and gasoline divisions.
One of the new trucks will be a full-size electric pickup, but its production has been delayed by 18 months, pushing the launch to 2027. This vehicle will be built in Tennessee and marks a key part of Ford’s revised electric vehicle strategy.
The second pickup will be a midsize model, developed by a specialist team in California, and is also scheduled to go on sale in 2027. In addition, Ford plans to begin production of the new commercial van at a plant in Ohio in 2026.
Ford has decided not to produce fully electric three-row SUVs due to the high costs associated with large batteries. Instead, the company will focus on hybrid versions of these SUVs, which offer similar cost-effectiveness to traditional gasoline-powered vehicles.
This move is in line with the growing trend in the market, where gas-electric hybrids have seen a 35.3% increase in sales during the first half of the year, far outpacing the 7% growth in electric vehicle sales.
The electric vehicle market is evolving rapidly, with Chinese automakers leading the way in cost efficiency. To remain competitive, Ford announced a reduction in its capital spending on electric vehicles, now allocating 30% of its annual capital budget to EV development, down from 40% previously.
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