Ford Motor said Monday it would scale back plans to produce electric vehicles and take a $19.5 billion hit to its profit to cover the costs of a major change in strategy.
The announcement amounted to an admission by Ford that it had overestimated demand for battery-powered vehicles and underestimated the staying power of vehicles powered by gasoline and diesel.
The move was also the result of a reversal in government policies since President Trump took office in January. His administration has slashed government incentives for electric vehicles while promoting fossil fuels.
Ford executives said the changes announced Monday would affect factories in several states.
A new factory in Tennessee that had been expected to produce an electric pickup truck will instead produce a gasoline model, Ford said. The company will cancel plans for an electric commercial van and instead build new gasoline and hybrid models in Iowa.
And the F-150 Lightning, an electric version of Ford’s popular pickup manufactured in Michigan, will no longer be a pure electric vehicle. Instead, it will be equipped with an auxiliary gasoline-fueled generator that can recharge its battery when it has been depleted, Ford said.
Ford said that it remained committed to building a medium electric pickup in Kentucky that will cost around $30,000, or about as much as similar gasoline-powered vehicles. The technology for the pickup can also be used for other kinds of vehicles.
Still, the announcement represents a significant retreat by Ford on pure electric vehicles, at least in the short term.
Jim Farley, the chief executive of Ford, insisted that the company would still be able to compete with Chinese automakers whose well-regarded electric vehicles are quickly gaining market share in Asia, Europe and Latin America. They are in effect barred from the United States by tariffs, but auto executives acknowledge those vehicles or the technology in them cannot be kept out forever.
“They don’t know about truck customers in the U.S. We do,” Mr. Farley said in an interview Monday, referring to Chinese automakers.
The changes announced Monday will allow Ford to be more profitable and competitive, he said. The planned medium pickup will help Ford defend against low-cost Chinese models, he added.
“I think this makes our company much more China-proof,” Mr. Farley said
Despite the big financial hit, Ford expects to still report a profit before interest and taxes of around $7 billion for 2025, the company said. Ford will report a loss in the fourth quarter, when most of the $19.5 billion will be booked.
Jack Ewing covers the auto industry for The Times, with an emphasis on electric vehicles.
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