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, with a significant portion tied to the cancellation of future electric vehicle (EV) models. This decision marks a significant shift in the company’s strategy, as it moves away from its previously stated goal of transitioning to an all-electric lineup. Instead, Ford will be focusing on producing models with internal combustion engines (ICE) and hybrid engines.
According to the company, $8.5 billion of the charge is tied to costs associated with killing future EVs. This is a significant blow to the company’s electric vehicle ambitions, as it had previously announced plans to invest heavily in the development of new EV models. The decision to cancel these models is likely to be a major setback for the company’s efforts to compete in the increasingly competitive electric vehicle market.
In addition to the cancellation of EV models, Ford is also writing off $6 billion tied to a now-cancelled battery operation joint venture (JV) with South Korea’s SK On. This JV was intended to provide Ford with a significant source of battery supply for its electric vehicles, but it appears that the company has decided to abandon this effort.
Perhaps the most significant aspect of Ford’s new strategy is the conversion of its flagship electric truck-manufacturing factory in Tennessee to produce models with ICE and hybrid engines. This factory was previously intended to be a key production facility for Ford’s electric vehicles, but it will now be repurposed to produce more traditional vehicles. This move is likely to be seen as a major shift away from electric vehicles and towards more traditional powertrains.
The reasons behind Ford’s decision to shift away from electric vehicles are not entirely clear, but it is likely that the company is responding to changing market conditions and consumer demand. While electric vehicles have been gaining popularity in recent years, they still represent a relatively small portion of the overall automotive market. Additionally, the production of electric vehicles is often more complex and expensive than traditional vehicles, which can make them less profitable for manufacturers.
It’s also possible that Ford is responding to the increasingly competitive nature of the electric vehicle market. With companies like Tesla, Volkswagen, and General Motors all investing heavily in electric vehicle technology, the market is becoming increasingly crowded and competitive. By shifting its focus away from electric vehicles, Ford may be attempting to differentiate itself and focus on areas where it has a stronger competitive advantage.
Regardless of the reasons behind Ford’s decision, it is clear that the company is making a significant shift in its strategy. The cancellation of EV models and the conversion of its electric vehicle factory to produce traditional vehicles are major moves that will likely have significant implications for the company’s future.
As the automotive industry continues to evolve and change, it will be interesting to see how Ford’s new strategy plays out. Will the company be able to successfully compete in the traditional vehicle market, or will it ultimately regret its decision to shift away from electric vehicles? Only time will tell, but one thing is certain: Ford’s decision to spend ₹1.77 lakh crore to cancel EV models and shift back to ICE and hybrid cars is a major development that will be closely watched by industry observers and consumers alike.
In conclusion, Ford’s decision to cancel EV models and shift its focus towards traditional vehicles is a significant move that marks a major shift in the company’s strategy. While the reasons behind this decision are not entirely clear, it is likely that the company is responding to changing market conditions and consumer demand. As the automotive industry continues to evolve and change, it will be interesting to see how Ford’s new strategy plays out.
News Source: https://www.reuters.com/business/autos-transportation/fords-195-billion-ev-writedown-five-things-know-2025-12-16/
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