Ford to spend ₹1.77 lakh crore to cancel EV models; shift back to ICE, hybrid cars
In a shocking move, Ford has announced a massive $19.5-billion (about ₹1.77 lakh crore) charge on electric-vehicle investments, signaling a significant shift in its strategy towards electric vehicles. The announcement has sent ripples through the automotive industry, with many wondering what this means for the future of electric vehicles. According to the company, $8.5 billion of this charge is tied to costs associated with killing future EV models, while about $6 billion is tied to a now-cancelled battery operation joint venture with South Korea’s SK On.
This decision comes as a surprise, given the significant investments Ford had made in electric vehicles in recent years. The company had been aggressively pushing towards electrification, with plans to launch several new electric models in the coming years. However, it seems that the company has had a change of heart, and is now shifting its focus back towards internal combustion engine (ICE) and hybrid cars.
One of the most significant consequences of this decision is the conversion of Ford’s flagship electric truck-manufacturing factory in Tennessee to produce models with ICE and hybrid engines. This factory was initially designed to produce electric vehicles, but will now be repurposed to produce more traditional vehicles. This move is likely to have significant implications for the company’s production plans and supply chain.
The decision to cancel future EV models and shift back to ICE and hybrid cars is likely to be driven by a number of factors. One possible reason is the high cost of developing and producing electric vehicles. While electric vehicles have been gaining popularity in recent years, they are still more expensive to produce than traditional vehicles. This is due to the high cost of batteries and other components, which can make it difficult for companies to turn a profit.
Another possible reason for Ford’s decision is the changing regulatory landscape. While many countries have been pushing for the adoption of electric vehicles, there are also concerns about the impact of EVs on the environment. For example, the production of batteries requires significant amounts of energy and resources, which can have negative environmental impacts. Additionally, the disposal of batteries at the end of their life can also pose environmental risks.
Despite these challenges, many companies are still committed to the development and production of electric vehicles. In fact, some companies, such as Tesla, have made electric vehicles their core business. However, for Ford, it seems that the costs and challenges associated with EVs have become too great.
The implications of Ford’s decision are likely to be far-reaching. For one, it may signal a shift in the automotive industry towards more traditional vehicles. If other companies follow Ford’s lead, it could slow the adoption of electric vehicles and reduce the pressure on companies to develop and produce more sustainable vehicles.
On the other hand, Ford’s decision may also create opportunities for other companies to fill the gap in the electric vehicle market. With Ford no longer pursuing electric vehicles, other companies may see an opportunity to gain market share and establish themselves as leaders in the EV space.
In conclusion, Ford’s decision to cancel future EV models and shift back to ICE and hybrid cars is a significant development in the automotive industry. While the reasons behind this decision are complex and multifaceted, it is clear that the company has made a strategic choice to prioritize more traditional vehicles. As the industry continues to evolve, it will be interesting to see how other companies respond to Ford’s decision and how the market for electric vehicles continues to develop.
News Source: https://www.reuters.com/business/autos-transportation/fords-195-billion-ev-writedown-five-things-know-2025-12-16/
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