Ford cuts electric F-150 Lightning production, takes $19.5B charge in strategic shift
Company expects 50% of global volume to be hybrids and electric vehicles by 2030, up from 17% in 2025
Ford CEO: This is a better play for our company and shareholders
Ford CEO Jim Farley updates consumers on the state of the company on ‘Kudlow.’
Ford CEO Jim Farley announced the company is cutting production of the electric F-150 Lightning and refocusing its investment on hybrid vehicles and affordable EVs.
The Detroit automaker announced the move on Monday and explained it will take a $19.5 billion charge on its EV assets and product roadmap. The change will bring about roughly $5.5 billion in cash effects with the majority paid in 2026 and the remainder in 2027.
Farley appeared on FOX Business Network's "Kudlow" and said the move will allow Ford to realize more of its upside potential, saying, "We think this is a better play for our company and for our shareholders.
"Rather than spend billions more on these large EVs that we had planned that have no path to profitability, we're going to pour our investments into higher margin areas — more American-built trucks, more American-built vans, hybrids across our lineup and even affordable EVs built in Kentucky. And we're going to go into the energy storage business in the Midwest, make our country stronger," Farley added.
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Ford is planning to stop production of the current generation F-150 Lightning, while refocusing on hybrids and reworking its long-term EV plans. (Nic Antaya/Bloomberg via Getty Images)
"Everyone knows the F-150 is the best-selling vehicle in our country for decades, and Larry, the hybrid is now 30% of our mix," Farley said.
"It's not just because you can tow or get better gas mileage, it's because you can also power your house with your F-150 hybrid or a job site. These hybrids are more than just economical now, and they've been more popular than we ever expected."
SEE INSIDE FORD'S NEW WORLD HEADQUARTERS, WHERE INNOVATION MEETS DESIGN
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| F | FORD MOTOR CO. | 13.65 | +0.01 | +0.07% |
Farley said that Ford has seen a rise in demand for hybrids and is responding to consumers' preferences by redeploying capital and revising its EV strategy.
"Last month, our sales were flat. Our hybrids were up 30%, and now we're going to have hybrids across our range. Instead of investing that money in very large EVs that won't be profitable, we're going to give Americans more affordable vehicles built here in America that are going to save people money," he explained.
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Ford CEO Jim Farley said the strategic shift will better serve the company and its shareholders by serving consumers' preferences. (Emily Elconin/Bloomberg via Getty Images)
While Ford is ending production of its current generation F-150 Lightning this year, the company plans to shift its next-generation F-150 Lightning to an extended-range electric vehicle architecture (EREV), which the company estimates will add 700 miles or more.
The company said the F-150 Lightning EREV will also be built at its Rouge Electric Vehicle Center in Dearborn and that more details about the vehicle and the timing of its launch will be available at a later date.
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Ford said that, by 2030, it expects about 50% of its global volume will be hybrids, extended-range EVs and fully electric vehicles, an increase from 17% in 2025.