Ford Motor Co. said Monday it will need to write down $19.5 billion in the U.S. and kill several electric vehicle models, the most dramatic example of the auto industry's shift away from battery-powered models in response to Trump administration policies and weakening demand for electric vehicles.
The Michigan-based company said it will replace the all-electric F-150 Lightning with a new, longer-range electric model that uses a gasoline engine to charge the battery.
The company is also dropping its next-generation electric truck, codenamed T3, as well as its planned electric commercial vans.
“When the market really changed over the last couple of months, that really prompted us to make that call,” Ford CEO Jim Farley told Reuters.
Ford has said it will aggressively transition to gas and hybrid models and will eventually hire thousands of workers, although there will be layoffs in the near future at its joint battery plant in Kentucky.
The company expects the global share of hybrids, extended-range electric vehicles and pure electric vehicles to reach 50 percent by 2030, from 17 percent today.
The auto company will spread out write-downs that occurred primarily in the fourth quarter and continue into next year and into 2027, the company said. About $8.5 billion is due to the cancellation of planned electric vehicle models.
About $6 billion is due to the liquidation of a battery joint venture with South Korea's SK On, and $5 billion is due to what Ford called “program-related expenses.”
The automaker also raised its forecast for 2025 adjusted earnings before interest and taxes to about $7 billion, up from a previous range of $6 billion to $6.5 billion.
Ford shares were up about 1 percent in after-hours trading.
Trump's policies are changing the electric vehicle market
Ford's shift reflects the auto industry's response to declining demand for battery-powered models after auto companies poured hundreds of billions of dollars into electric vehicle investments earlier this decade.
The outlook for the electric power industry has worsened significantly this year as U.S. President Donald Trump's policies have led to the end of federal support for electric vehicles and the easing of tailpipe emissions rules, which could prompt automakers to sell more gasoline-powered vehicles.
U.S. electric vehicle sales fell about 40 percent in November after the Sept. 30 expiration of a $7,500 consumer tax credit that had been in place for more than 15 years to stimulate demand.
The Trump administration also included in a sweeping tax and spending bill passed in July a freeze on the fines automakers pay for violating fuel economy rules.
The F-150 Lightning rolled off the assembly line starting in 2022 with great fanfare—comedian Jimmy Fallon wrote a song about the truck. Ford increased production of the model to meet an influx of 200,000 orders, but sales lagged.
Through November of this year, the company sold 25,583 Lightnings, down 10 percent from the previous year.
The successor to the F-150 Lightning, the T3 truck, would be built from the ground up at a new facility in Tennessee and become a core part of Ford's second-generation electric vehicle lineup.
Ford is now replacing electric pickup production with new gas-powered trucks starting in 2029 at its Tennessee plant.
Ford effectively killed off all second-generation electric vehicle models with Monday's announcement. For its upcoming lineup of electric vehicles, the company is shifting its focus to more affordable EV models developed by the so-called skunkworks team in California.
Ford plans to price the team's first model at approximately $30,000 and begin sales in 2027. Ford assembles this midsize electric car at its Louisville plant.
“Instead of spending billions more on big electric vehicles that currently have no path to profitability, we're putting that money into more profitable areas,” said Andrew Frick, head of Ford's gasoline and electric vehicle business.
Earlier this year, Ford said it expected to lose about $5 billion on its electric vehicle business this year, about the same as it lost in 2024.
GM and Stellantis are also cutting production
A recent decline in electric vehicle sales in the United States is forcing automakers that rushed to bring electric models to market to compete for a shrinking pool of buyers. Like Ford, many traditional automakers are returning to gas and hybrid models while narrowing their EV offerings to offset losses in that segment.
This could give electric vehicle makers such as Tesla and Rivian an opportunity to take market share, albeit a smaller one, analysts say.
In October, General Motors took on a $1.6 billion fee to adjust its electric vehicle plans and warned it would likely have to take on even more fees in the future. Stellantis has also backed away from some of its electric vehicle plans, ditching its planned electric Ram pickup truck and focusing on hybrids.
The move by some traditional automakers to hybrids follows the lead of Toyota Motor, the longtime market leader in hybrid models, which has emphasized the technology even during the industry's EV euphoria.
Ford pulled out of a three-row electric SUV last year, a move the company said at the time would cost the company $1.9 billion. The automaker said Monday it expects to turn a profit from its electric vehicle business by 2029.
Ford's electric vehicle manufacturing facilities and three battery plants in the South were shut down last week when its joint venture partner SK On announced it was ending its partnership with Ford.
The automaker confirmed Monday that as part of the split, the Ford subsidiary will independently own and operate battery plants in Kentucky, while SK On will own and operate a battery plant in Tennessee.
Ford said it will use its battery plants in Kentucky and Michigan to produce batteries for energy storage systems and plans to have initial capacity in service within 18 months. The Marshall, Michigan plant will also produce batteries for Ford's $30,000 midsize electric vehicle.
