Ford is adjusting its electric vehicle (EV) strategy by canceling plans for a large, all-electric SUV and delaying the launch of its next electric pickup truck.
Chief Financial Officer John Lawler cited “pricing and margin compression” as reasons for the shift.
The decision comes amid a slowdown in EV demand and increasing competition, which has led to price wars and margin pressures.
Ford aims to leverage advancements in battery technology to reduce costs and improve vehicle range.
The company will reduce the proportion of its annual capital expenditures dedicated to “pure” electric vehicles from 40% to 30%, with expected write-downs and new spending totaling about $1.9 billion.
CEO Jim Farley stated that the revised plan will offer more choices to customers and capitalize on Ford’s strengths.
Previously, Ford had ambitious plans to produce around two million electric vehicles annually by 2026, including an electric version of its popular F-150 pickup truck, launched in 2022.
However, Ford, along with competitors like General Motors, has scaled back its electric ambitions due to weaker-than-expected demand and a preference for hybrids.
Despite recent gains in electric car sales in the US, competition remains intense.
Ford reported selling over 50,000 electric cars this year, a 60% increase, but also incurred nearly $2.5 billion in losses in its electric vehicle segment.
To cut costs, Ford is shifting some battery production from Poland to the US to take advantage of incentives under the Inflation Reduction Act.
The next electric pickup truck’s production has been postponed until 2027, and the planned large all-electric SUV will now be offered as a hybrid.
The company will focus its all-electric efforts on a commercial van, with assembly scheduled to start in Ohio in 2026.
