Ford has announced a significant shift in its electrification plans, one that could lead to $1.5 billion in additional expenses and cash expenditures.
According to a press release, the auto manufacturer will delay its new EV plant in Tennessee. This plant originally would begin producing vehicles this year. Now, it will start producing battery cells in 2025.
Ford has also altered its plans for upcoming vehicles, which included a three-row electric SUV. The company will no longer move forward with this vehicle as it instead shifts the focus toward hybrid technology.
The auto manufacturer will begin development on a new family of electrified three-row SUVs. These will include hybrid technology for improved performance and reduced carbon emissions. Additionally, the new range of F-Series Super Duty pickups will offer different “propulsion options.”
The cancellation of the three-row EV SUV will incur short-term costs. Ford says it is “a special non-cash charge of about $400 million for the write-down of certain product-specific manufacturing assets.”
Ford also says its shifting electrification plans could include additional expenses and cash expenditures of up to $1.5 billion.
“We are committed to innovating in America, creating jobs, and delivering incredible new electric and hybrid vehicles that make a real difference in CO2 reduction,” said Ford President and CEO Jim Farley in a statement.
“We learned a lot as the No. 2 U.S. electric vehicle brand about what customers want and value, and what it takes to match the best in the world with cost-efficient design, and we have built a plan that gives our customers maximum choice and plays to our strengths.”
Ford remains focused on electrification
Electrification will still have a place in Ford’s plans. However, it will be further down the road. The company will work on producing an electric commercial van for 2026. Two EV pickups will follow for 2027.
The electric commercial truck will begin production at Ford’s plant in Ohio. The full-size pickup will begin production at the Tennessee plant with a release window in the second half of 2027. This is the “Project T3” truck that builds on feedback from owners of the F-150 Lightning.
The second pickup will be a midsize model that Ford says will cater to customers wanting more for their money. Ford says this vehicle will deliver more range, more utility, and more useability.
“We’re committed to creating long-term value by building a competitive and profitable business,” said John Lawler, Ford vice chair and chief financial officer, in a statement.
“With pricing and margin compression, we’ve made the decision to adjust our product and technology roadmap and industrial footprint to meet our goal of reaching positive EBIT within the first 12 months of launch for all new models.”