Ford Reworks Strategy Amid EV Losses

Ford changes strategy due to piling losses and reformulates EV plans, as it increases investment in hybrids and energy storage.

Ford Motor Company has revealed a significant change in its strategy following an affirmation that it will incur USD 19.5 billion of losses related to its EV venture. The automobile maker indicated that it will recalibrate its capital towards more profitable opportunities as it will downsize some of its EV plans, which have been affected by poor demand, escalated costs and regulatory shifts.

Ford has, in its reset, cancelled a US battery manufacturing joint venture with SK On in South Korea and scrapped larger EV models, including the F-150 Lightning electric pickup. Future developments of the truck will be on further extended-range electric vehicle developments that incorporate batteries in combination with backup generation.

Nevertheless, with the pullback, Ford reiterated that it is still committed to smaller EVs based on its Universal EV Platform, with a growing hybrid lineup to adjust to the changing tastes and preferences of its customers. According to CEO Jim Farley, the recalculation of the approach can be explained by a shifting buyer choice and the development of the policy situation, which today implies flexibility and affordability.

Simultaneously, Ford is shifting idle EV battery capacity into a new battery storage business. Kentucky and Michigan facilities will be reused to produce lithium iron phosphate batteries and utility-scale battery energy storage systems and data center systems.

Although Ford will maintain the provision of EV vans in Europe, it will switch a few North American electric commercial products to gas and hybrids. The company claimed that the new strategy strikes a balance between the long-term objective of electrifying and the short-term profitability and choice of customers.