Ford Motor announced a major strategic retreat from pure electric vehicles (EVs) on Monday, citing weakening consumer demand and the impact of recent policy changes by the Trump administration. The company will take a colossal $19.5 billion writedown, primarily in the fourth quarter, signalling one of the most dramatic setbacks for the auto industry’s electrification efforts.
The writedown includes $8.5 billion for cancelled EV projects, $6 billion related to dissolving a battery joint venture with South Korea’s SK On, and $5 billion for other programme-related expenses.
In response to the shifting market, Ford is immediately scrapping several planned models, including a next-generation electric truck (codenamed T3) and future electric commercial vans. Crucially, the fully electric F-150 Lightning will be replaced by a new extended-range electric model that utilizes a gas-powered engine to recharge the battery.
“When the market really changed over the last couple of months, that was really the impetus for us to make the call,” Ford CEO Jim Farley told Reuters in an interview.
This pivot marks a hard shift toward gas and hybrid models. Ford now projects that its global mix of hybrids, extended-range EVs, and pure EVs will stabilize at 50% by 2030, a modest rise from 17% today. The company anticipates some short-term layoffs at a Kentucky battery plant but expects to hire thousands of workers eventually to support its revamped strategy.
The shift reflects broader industry anxieties, worsened by the 30 September expiration of a 15-year-old $7,500 consumer tax credit — a key federal support mechanism for EVs. This expiration, combined with the Trump administration easing tailpipe-emissions rules and freezing fuel-economy regulation fines, has dampened the incentive for automakers to push EVs and for consumers to buy them. US EV sales fell 40% in November following the credit's removal.
Despite the massive financial charge, Ford raised its 2025 guidance for adjusted earnings before interest and taxes to approximately $7 billion, up from a previous range of $6 billion to $6.5 billion. Ford shares rose about 1% in after-hours trading following the announcement.
Like Ford, many traditional automakers are rotating back to gas and hybrid models, while narrowing their EV offerings to shore up losses in that space.
In October, General Motors also took a $1.6 billion charge as it adjusted its EV factory plans, and warned that it would likely take more charges in the future.
Stellantis has also scaled back some of its EV plans, scrapping a scheduled electric Ram pickup truck and leaning into hybrids.
