Ford to spend ₹1.77 lakh crore to cancel EV models; shift back to ICE, hybrid cars
The automotive industry has been abuzz with the news of Ford’s significant shift in strategy, marking a major reversal in its electric vehicle (EV) ambitions. In a shocking move, the American automaker has announced a massive $19.5-billion (approximately ₹1.77 lakh crore) charge on its electric-vehicle investments, with a substantial portion of this amount tied to the costs associated with discontinuing future EV models. This decision comes as a surprise, given the industry’s growing emphasis on sustainable and environmentally friendly transportation solutions.
According to the announcement, about $8.5 billion of the charge is directly related to the costs of killing off future EVs, while approximately $6 billion is tied to a now-cancelled battery operation joint venture (JV) with South Korea’s SK On. This JV was initially intended to support Ford’s EV ambitions, but its cancellation marks a significant setback for the company’s electric vehicle plans. The remaining amount will be used to cover other costs associated with the shift in strategy.
One of the most notable consequences of this decision is the conversion of Ford’s flagship electric truck-manufacturing factory in Tennessee to produce models with internal combustion engines (ICE) and hybrid engines. This move is a clear indication of the company’s intent to shift its focus back to traditional powertrains, at least for the time being. The Tennessee factory was initially designed to produce electric vehicles, including the highly anticipated Ford F-150 Lightning, but it will now be repurposed to accommodate the production of ICE and hybrid models.
This strategic shift raises several questions about the future of the automotive industry and the role of electric vehicles in it. While many manufacturers have been investing heavily in EV technology, Ford’s decision to scale back its electric ambitions may be seen as a cautionary tale. The company’s move may be driven by a variety of factors, including changing market conditions, technological challenges, and shifting consumer preferences.
One possible explanation for Ford’s decision is the current state of the EV market. Despite growing demand for electric vehicles, the industry still faces significant challenges, including high production costs, limited charging infrastructure, and battery technology limitations. These challenges may have led Ford to reassess its EV strategy and prioritize more established powertrains.
Another factor that may have contributed to Ford’s decision is the intense competition in the EV market. With numerous manufacturers vying for market share, the competition has become increasingly fierce, making it difficult for companies to stand out and achieve profitability. By shifting its focus back to ICE and hybrid models, Ford may be attempting to regain its competitive edge in a more familiar and established market.
The implications of Ford’s decision are far-reaching and may have significant consequences for the automotive industry as a whole. While the company’s move may be seen as a setback for the EV market, it also highlights the ongoing evolution of the industry and the need for manufacturers to adapt to changing market conditions.
In conclusion, Ford’s decision to spend ₹1.77 lakh crore to cancel EV models and shift back to ICE and hybrid cars marks a significant turning point in the company’s history. While the move may be seen as a reversal of its previous EV ambitions, it also underscores the importance of adaptability and strategic decision-making in the rapidly changing automotive industry.
As the industry continues to evolve, it will be interesting to see how Ford’s decision plays out and what impact it will have on the company’s future prospects. One thing is certain, however: the automotive industry will continue to be shaped by technological advancements, changing consumer preferences, and shifting market conditions.
For more information on this story, please visit: https://www.reuters.com/business/autos-transportation/fords-195-billion-ev-writedown-five-things-know-2025-12-16/
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