Ford Motor Company recently delayed the production of an electric vehicle plant based in Stanton, Tennessee, amid a pullback in consumer interest in battery-powered cars. The company also scrapped plans to produce a fully electric SUV. Over the past couple of years, Ford and other car manufacturers have endured significant losses on their EV lineups.
Ford executives announced last week that investment in their EV division would slow significantly, where capital expenditure allocated to fully electric cars would decline from 40% to 30%. Ford intended to launch two EVs in 2027 at the Tennessee Electric Vehicle Center: a medium-sized truck and the newest installment of the best-selling F-Series truck.
However, the full-sized pickup, referred to as “Project T3” has been postponed by 18 months. Furthermore, Ford is also altogether canceling a three-row electric SUV, opting to produce a hybrid instead. The move from Ford mirrors strategic changes across the auto industry where companies are pulling back from all-electric plans.
The American Tribune has extensively reported on Ford’s EV woes, in which the Detroit-based manufacturer notes that it is seeking to utilize its “manufacturing flexibility” to tailor production and meet consumer demand. Earlier this year, Ford had converted an EV factory in Canada to focus production capacity on gas-powered pickups.
President and CEO Jim Farley said, “We are taking advantage of our manufacturing flexibility to offer customers choices while balancing our growth and profitability. Customers love the F-150 Lightning, America’s best-selling EV pickup. We see a bright future for electric vehicles for specific consumers, especially with our upcoming digitally advanced EVs and access to Tesla’s charging network beginning this quarter.”
Ford CFO John Lawler also maintained that the company is not abandoning its EV goals but is reevaluating the pace at which it will pursue them. “We’re not moving away from our second generation [EV] products. We are, though, looking at the pace of capacity that we’re putting in place. We are going to push out some of that investment.”
Moreover, Lawler added that its plans would be determined by how many of the electric vehicles customers want to purchase, stating, “The customer is going to decide what the volumes are. Ford is able to balance production of gas, hybrid and electric vehicles to match the speed of EV adoption in a way that others can’t.”
"*" indicates required fields
According to reports earlier this summer, Ford is set to lose approximately $5 billion on its EV business this year. This figure represents a roughly $44,000 loss per electric vehicle produced by the company. Last quarter, Ford endured a 37% decline in EV sales, leading to fluctuations in share price.
Last year, car dealers from around the country wrote an open letter to President Biden urging him to pull back on the EV agenda. The letter read , “Mr. President, it is time to tap the brakes on the unrealistic government electric vehicle mandate. Allow time for the battery technology to advance. Allow time to make BEVs more affordable. Allow time to develop domestic sources for the minerals to make batteries. Allow time for the charging infrastructure to be built and prove reliable. And most of all, allow time for the American consumer to get comfortable with the technology and make the choice to buy an electric vehicle.”