Ford cancels the F-150 Lightning EV, takes a 19.5 billion dollar charge in a hybrid turnaround, and starts a new battery storage company.

Ford cancels the F-150 Lightning EV, Announced a number of changes to its EV business, including a shift away from complete EVs and toward hybrid and extended-range EVs (EREVs). The move will cost the corporation an astounding $19.5 billion. Ford announced that it would move battery production to other locations and scrapped the Lightning EV truck in its current configuration.

Ford CEO Jim Farley stated in a statement, “The operating reality has changed, and we are redeploying capital into higher-return growth opportunities: Ford Pro, our market-leading trucks and vans, hybrids, and high-margin opportunities like our new battery energy storage business.”

Ford will focus its EV development in North America on its new, flexible, low-cost Universal EV Platform, which will be utilized for smaller, more efficient EVs intended to appeal to a wider spectrum of consumers. The completely connected midsize pickup truck built at its Louisville Assembly Plant beginning in 2027 will be the first car from the Universal EV Platform.

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This idea calls for the next version of the F-150 Lightning to be built at the Rouge Electric Vehicle Center in Dearborn, Michigan, using an EREV architecture. EREVs are basically EVs that charge their batteries by using an onboard gas engine as a generator.

As the business redeploys workers to the Dearborn Truck Plant to support a third crew for F-150 gas and hybrid truck production, Ford announced that production of the current generation F-150 Lightning has ended. The change was brought about by the Novelis aluminum plant fires, which affected the manufacture of gas-powered F-150s.

In 2029 Ford plans to transform its Tennessee Electric Vehicle

In 2029, Ford plans to transform its Tennessee Electric Vehicle Center into the Tennessee Truck Plant, where it will produce new gas-powered truck models.

Ford’s Ohio Assembly Plant will serve as a “central hub” for Ford Pro, producing Super Duty truck chassis cabs and a new gas and hybrid commercial van in 2029 that will replace a planned electric van.

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Ford anticipates that hybrids, extended-range EVs, and fully electric vehicles would account for about 50% of its global volume by 2030, up from 17% in 2025.

Ford declined to disclose the proportion of EVs, hybrids, and EREVs that would make up its sales by 2030.

Instead than allowing surplus capacity to sit idle, Ford plans to repurpose its current EV battery operations in Kentucky and Michigan to start a brand-new battery energy storage system business.

During a call with reporters, Lisa Drake, vice president of technology platforms at Ford, stated, “It just made a lot of sense as a natural adjacency for us.” Drake added that possible clients included data center providers and grid-scale power consumers.

Although the smaller batteries produced at its battery plant in Marshall, Michigan, might be used for residential clients, Drake pointed out that commercial customers are the main target market.

Ford announced last week that while SK On would now entirely own and run a battery factory in Tennessee that was a part of the partnership, a subsidiary would now fully own and run the two battery factories in Kentucky that it operated with SK On as part of a joint venture.

Financial ramifications of Ford’s change

These strategic adjustments will have a significant financial impact. Although Farley claimed that these actions were necessary to meet customer demands and increase Ford’s “profitable,” the board and he took the initiative to aggressively pursue an EV strategy.

Ford currently anticipates recording approximately $19.5 billion in extraordinary items, of which $12.5 billion will be recognized in the fourth quarter and the remaining $7.0 billion will be recorded in 2026 and 2027.

Cash charges of $5.5 billion for car cancellations and charges are included in the $19.5 billion, with the majority being paid in 2026 and the remaining amount in 2027, according to Ford.

CFO Sherry House told reporters that the asset impairment element of the writedown is $8 billion, which includes a writedown of EV assets as well as $6 billion related to restructuring and acquiring assets like the Kentucky battery factories from Ford’s battery partner SK ON.

Apart from special items, Ford improved its 2025 adjusted EBIT guidance from $6 billion to $6.5 billion, which was lower than the $6.5 to $7.5 billion seen prior to the Novelis fires, to roughly $7 billion “given continued underlying business strength, including cost improvement.”

Ford reiterated its guidance range for adjusted free cash flow, which is at the upper end of a $2 billion to $3 billion range.

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