Ford takes $19.5 billion hit in Detroit's biggest EV bust

It marks the U.S. auto industry’s biggest reckoning to date that it can’t realize its EV ambitions anytime soon

- Sharon Terlep

Automaker is shifting to hybrid gas-and-electric vehicles.

(REUTERS)

Ford Motor said Monday it expected to take about $19.5 billion in charges, mainly tied to its electric-vehicle business, a massive hit as the automaker retrenches in the face of sinking EV demand.

The sum is among the largest impairments taken by a company and marks the U.S. auto industry’s biggest reckoning to date that it can’t realize its electric-vehicle ambitions anytime soon.

Ford, which has lost $13 billion on its EV business since 2023, said it would bolster its lineup of gas-powered vehicles while shifting to hybrid and so-called extended-range electric vehicles that include onboard gasoline engines.

The goal is to pull back from loss-making assets and redeploy capital designated for EVs to models with higher profitability.

“Instead of plowing billions into the future knowing these large EVs will never make money, we are pivoting,” Ford Chief Executive Jim Farley said in an interview. “We now know enough about the U.S. market where we have a lot more certainty in this second inning” of reduced-emissions powertrains, he said.

Regulatory changes and lackluster demand from Americans are forcing U.S. automakers to abandon plans to quickly step to an electric-vehicle future. Ford, which had bet big on EVs, is now making one of the industry’s biggest changes to its business.

The company said it remains on track to produce a $30,000 EV pickup for sale by 2027, which the company says will be the first in a new string of low-cost EVs. “Now this is the core of our EV strategy in America,” Farley said. “We've got to land the plane.”