Ford Axes Electric F-150 Lightning, Takes $19.5 Billion Hit as EV Market Crumbles

Ford Motor Co. has announced a dramatic retreat from its all-electric ambitions, saying it will take a massive $19.5 billion writedown and discontinue the fully electric F-150 Lightning. The move comes as the U.S. auto industry grapples with a sharp collapse in electric vehicle demand following the expiration of federal tax credits.In a significant pivot for the Detroit automaker, Ford plans to replace the F-150 Lightning with a new extended-range electric model that uses a gas-powered engine to recharge the battery. The company also is scrapping plans for its next-generation electric truck, codenamed T3, as well as its planned electric commercial vans.The restructuring will require a staggering financial hit. The company expects to record $19.5 billion in special items, with the majority of charges occurring in the fourth quarter. This includes $8.5 billion related to canceling planned EV models, $6 billion tied to the dissolution of a battery joint venture with South Korea’s SK On, and $5 billion in “program-related expenses.”Ford’s chief executive, Jim Farley, cited shifting market dynamics as the primary driver for the decision.“When the market really changed over the last couple of months, that was really the impetus for us to make the call,” Mr. Farley told Reuters. Speaking to CNBC, he added, “The last couple of months have been really clear to us. The very high-end EVs — the $50,000, $70,000, $80,000 vehicles — they just weren’t selling.”Ford’s strategy is now shifting aggressively toward hybrid vehicles. The automaker expects that by 2030, its global mix of hybrids, extended-range EVs, and pure EVs will reach 50 percent, up from just 17 percent today.“We evaluated the market, and we made the call,” Mr. Farley said on CNBC. “We’re following customers to where the market is, not where people thought it was going to be, but where it is today.”Despite the massive writedowns, Ford raised its 2025 guidance for adjusted earnings before interest and taxes to about $7 billion. The company hopes these changes will provide a path to profitability for its Model E electric vehicle business by 2029.Ford’s retreat mirrors a broader crisis in the U.S. electric vehicle market. Demand has nosedived following the September 30 expiration of the $7,500 federal consumer tax credit — a policy change enacted by the Trump administration.According to data from Cox Automotive, the impact was immediate and severe. Electric vehicle sales fell dramatically in October to 74,835 units, a 48.9 percent decline month-over-month and a 30.3 percent drop compared to the previous year.“We expected this shift in the electric vehicle market,” said Cox senior analyst Stephanie Valdez Streaty. “With the IRA-backed sales incentives gone, lower-cost EV volume was hit hard, pushing the mix toward more luxury and driving October’s EV ATP to a 2025 high of $59,125 — now $9,359 above the industry average. Affordability has always been the core challenge with EV sales, and this reset only underscores how critical it is to bring more attainable EV options to market.”With the loss of federal support, lease prices have surged, and automakers are left with diminishing incentives to push battery-powered models. While Ford is pulling back on large electric trucks, it noted it will concentrate future North American EV development on a low-cost “Universal EV Platform” designed for smaller, more affordable vehicles, starting with a midsize pickup in 2027.Tesla has also felt the pain, but as consumers search for more affordable options, the Elon Musk company appears to be rebounding. After the third quarter, the last with the $7,500 tax credit, Tesla’s market share dropped nearly in half to just 41 percent compared to five years ago. But in October, sales rose 55 percent, followed by another 57 percent jump in November even as absolute sales fell from more than 60,000 in September to less than 40,000 in November. “The subsidy removal essentially stress-tested every brand’s underlying demand, and Tesla’s decline was significantly smaller,” Ms. Streaty told Sherwood News. “Whether that’s due to brand strength, infrastructure advantages like the Supercharger network, or simply less price-sensitive buyers is debatable, but the market share result is mathematical: when everyone declines, whoever declines least gains share.”

Ford Axes Electric F-150 Lightning, Takes $19.5 Billion Hit as EV Market Crumbles

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