Ford Reshapes Electric Vehicle Plans
Ford Motor Company (NYSE:F) is adjusting its electric vehicle (EV) strategy, making significant changes to its planned projects as it aims to manage the higher costs associated with EVs. Key adjustments include the cancellation of a large, three-row electric SUV and a delay in the launch of its new electric truck, code-named “Project T3.”
Changes in EV Strategy
Ford has decided to scrap the development of its planned large, three-row electric SUV. Instead, the company will use hybrid technology for its future three-row SUVs. This shift is expected to result in a special non-cash charge of approximately $400 million for the write-down of specific manufacturing assets, with potential additional charges of up to $1.5 billion in subsequent quarters.
Ford’s stock saw a modest increase of over 1% following the announcement. Vice Chairman and CFO John Lawler emphasized the need to adapt to customer feedback and cost considerations. “Hybrid tech for those customers is the best solution,” Lawler noted, citing the difficulty in meeting profitability targets with a large electric SUV within the first 12 months of its launch.
Delays and New Product Launches
The launch of Ford’s next-generation electric truck, Project T3, has been postponed to the latter half of 2027. This delay affects the assembly at Ford’s BlueOval City Tennessee Electric Vehicle Center, which will now occur 18 months later than originally planned.
Ford is also set to introduce an all-new commercial van in 2026, produced in Ohio. The company plans to release two new pickup trucks in 2027: a medium-sized pickup from Ford’s California Skunkworks team and the next-generation Project T3 truck.
Battery Production and Technological Advances
Ford is advancing its battery production plans, moving some Mustang Mach-E battery manufacturing from Poland to a new plant in Holland, Michigan, in 2025 to qualify for Inflation Reduction Act (IRA) tax credits. The BlueOval SK Kentucky plant will produce cells for the E-Transit commercial van, enhancing the range of F-150 Lightning trucks starting in mid-2025.
In late 2025, the BlueOval SK plant at BlueOval City in Tennessee will begin producing cells for Ford’s new electric commercial van and the Project T3 pickup. Ford also anticipates starting lithium iron phosphate (LFP) battery production in 2026 at BlueOval Battery Park Michigan, utilizing technology licensed from China’s CATL and qualifying for IRA benefits.
Financial Outlook and Future Plans
Lawler confirmed that these strategic changes align with Ford’s plan to defer $12 billion in EV spending. The company will also consider purchasing regulatory credits to meet emissions targets as needed. A broader “EV Day” is planned for the first half of next year to provide further details on the new hybrid SUV, its production location, and the EV business’s profitability schedules.
Ford’s EV sales have shown impressive growth, with a 31.2% increase in July and a 63.9% rise year-to-date, driven by strong performance from the Mustang Mach-E and F-150 Lightning.
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