Ford takes $19.5 billion in charges amid shift away from electric vehicles

Ford is taking about $19.5 billion in charges amid its shift away from electric vehicles, as the demand for EVs declines.The company has lost $13 billion on its EV business since 2023, and said Monday that it will increase production of gas-powered vehicles while shifting to hybrid and extended-range EVs that include onboard gasoline engines, The Wall Street Journal reported.
The $19.5 billion in charges includes $6 billion from the breakup of a joint venture to build EV batteries in the U.S. with SK Group. Most of the charges will be taken by Ford in the fourth quarter, but some will come later.
“Instead of plowing billions into the future knowing these large EVs will never make money, we are pivoting,” Ford CEO Jim Farley told the Journal. “We now know enough about the U.S. market where we have a lot more certainty in this second inning” of reduced-emissions powertrains.
U.S. automakers are abandoning their plans to quickly move to EVs due to regulatory changes and lackluster demand from Americans.
Ford said it is still planning on producing a $30,000 EV pickup for sale by 2027, which 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.”
Ford will stop making the Lightning, an EV version of its F-150 pickup truck, and shift to making an extended-range version of the truck.
By 2030, roughly half of Ford’s global volume will consist of hybrids, extended-range vehicles, and EVs, the company said, which is up from 17% this year.
Ford will also convert its Kentucky EV-battery factory into a battery-storage business for customers such as utilities, wind- and solar-power developers, and data centers that train artificial intelligence.
The company said it plans to hire thousands of new employees across the U.S., but about 1,600 workers at the battery plant will be laid off while it is repurposed.
Ford increased its earnings forecast for the year to $7 billion in adjusted pretax earnings, after reporting a net income of $5.9 billion last year on $185 billion in revenues.

Read Full Article: https://justthenews.com/nation/economy/ford-takes-195-billion-charges-amid-shift-away-electric-vehicles?utm_source=justthenews.com&utm_medium=feed&utm_campaign=external-news-aggregators