Ford takes $19.5 billion hit as it pulls back on electric vehicle plans, halts F-150 Lightning production
Ford's electric F-150 Lightning on the production line in Dearborn
(CNN) — Ford on Monday said it is pulling back on its electric vehicle plans, a move that will result in a $19.5 billion charge against its earnings to be taken mostly in the current quarter.
But excluding that charge, the company said this should actually be a fairly good quarter due to strong sales of its traditional gasoline-powered trucks and SUVs. It raised its operating profit target for the year to $7 billion.
But the pullback on its EV plans also means its flagship electric vehicle, the F150 Lightning, will be on hold indefinitely. Ford said the next generation of the F150 will have a 700-mile range and improved heavy-duty towing. It announced Monday that it had halted production of its original F150 Lightning model this month. But it did not give any details on when production of the new model would begin.
Demand for electric vehicles surged through the summer and September due to the scheduled expiration of a $7,500 US tax credit for EV buyers. Ford’s EV sales jumped 30% in the third quarter, compared to a year earlier, the company said in October. But those sales only came to 30,600 vehicles, or just less than 6% of its total US sales. While the company has not reported fourth-quarter EV sales, outside estimates are that all US EV sales fell sharply.
Ford and other automakers invested heavily in EV plans in anticipation of stringent environmental regulations put in place during the Biden administration. They also expected some states to follow the lead of California and ban gas-powered vehicle sales within a decade.
But the Trump administration has rolled back those emissions rules along with the financial support for EVs, and is challenging states’ authority to set tougher rules. So Ford is looking for ways to use some of those assets besides strictly powering electric vehicles. One of the plans the company announced Monday is to have some of its EV battery capacity repurposed for energy infrastructure and growing data center demands.
Correction: An earlier version of the story misstated Ford’s earnings guidance for 2025. Its operating profit target was revised to $7 billion.
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