Automaker pivots toward hybrids, smaller EVs, and profitability under CEO Jim Farley
Ford Motor announced Monday it expects to record roughly $19.5 billion in special items tied to a sweeping restructuring of its business priorities, marking a significant pullback from earlier ambitions in all-electric vehicles. Most of the charges will be recognized in the fourth quarter, with an additional $5.5 billion in cash expenses spread through 2027, the bulk of which is expected to hit next year.
The charges, including $8.5 billion in EV asset write-downs, will weigh on Ford’s net results but will not affect its adjusted earnings. Despite the restructuring, the Detroit automaker raised its outlook for 2025 adjusted earnings before interest and taxes to about $7 billion, restoring a target it had previously lowered amid weaker EV demand.
The move reflects a fundamental shift in strategy as Ford responds to changing market realities. The company plans to refocus investment on hybrid vehicles, including plug-in models, rather than betting heavily on pure EVs. It is canceling plans for a next-generation large all-electric truck in favor of smaller, more affordable EVs, while rebalancing spending toward its core trucks and SUVs.
CEO Jim Farley said the decision was driven by customer demand rather than ideology. “We’re following customers to where the market is,” Farley said, noting that high-priced EVs in the $50,000 to $80,000 range have struggled to gain traction. The early end of a $7,500 federal EV tax credit also contributed to the slowdown, though Farley emphasized it was not the sole factor.
Ford also revealed plans to transition the all-electric F-150 Lightning to an extended-range EV with a gas-powered generator and to repurpose battery plants in Kentucky and Michigan for a new stationary energy storage business. The company expects these changes to put its Model e EV unit on a path to profitability by 2029, with improvements beginning in 2026.
Investors responded positively, sending Ford shares up about 2% in after-hours trading. While the restructuring carries a heavy upfront cost, Ford is betting that a more pragmatic approach to electrification will deliver sustainable growth over the long term.
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