DEARBORN (Business Emerge): Ford Motor said it will record a $19.5 billion accounting charge and discontinue several electric vehicle programs as part of a broad reset of its product and investment strategy tied to changing market conditions.
The announcement was made on Monday by the Michigan-based automaker and includes the cancellation of planned battery-only models, revisions to existing electric trucks, and changes to battery manufacturing partnerships in the United States.
The company stated that the charge will be recognized primarily in the fourth quarter, with portions extending through 2027. About $8.5 billion of the total relates to the termination of future electric models, roughly $6 billion is linked to the dissolution of a battery joint venture with SK On, and around $5 billion reflects program-related costs tied to revised production plans.
As part of the changes, Ford will replace the fully electric F-150 Lightning with an extended-range electric pickup that uses a gasoline engine to recharge its battery. The automaker is also ending development of a next-generation electric truck known internally as T3, along with previously planned electric commercial vans.
Ford reported that sales of the F-150 Lightning reached 25,583 units through November, representing a decline of about 10 percent from the same period a year earlier. Production of the model began in 2022 and was expanded after early order volumes exceeded initial expectations.
The company said its future manufacturing footprint will include increased output of gasoline-powered trucks and hybrid vehicles. Production at the Tennessee facility originally planned for electric pickups will now be reoriented toward new gasoline truck models beginning in 2029.
Ford said its current vehicle mix includes about 17 percent hybrids, extended-range electric vehicles, and battery-only electric vehicles combined. The company expects that share to rise to approximately 50 percent by 2030 through expanded hybrid offerings and selective electric launches.
The automaker also updated its financial outlook, raising its 2025 adjusted earnings before interest and taxes guidance to about $7 billion, compared with a prior range of $6 billion to $6.5 billion. Shares of the company rose about 1 percent in after-hours trading following the announcement.
In recent years, Ford and other automakers invested heavily in battery-powered vehicles and related infrastructure. The company previously canceled a three-row electric sport utility vehicle in 2024, a move that carried an estimated cost of up to $1.9 billion. Ford has said it expects its electric vehicle business to reach profitability by 2029.
Ford confirmed that its joint venture with SK On has been unwound. Under the revised structure, a Ford subsidiary will own and operate battery plants in Kentucky, while SK On will operate a battery facility in Tennessee. The company said some layoffs may occur at the Kentucky site in the near term.
The automaker plans to use battery plants in Kentucky and Michigan to produce energy storage system batteries, with initial capacity expected within 18 months. The Marshall, Michigan facility will also supply batteries for a future midsize electric truck priced at about $30,000, with sales planned to begin in 2027.
