The Ford Motor Company is changing course on its electric vehicle plans in response to declining interest in the market, it announced on Wednesday.
The company will kill production of its three-row SUV and has put its next-generation pickup truck on the back burner, replacing it with a new mid-size pickup and a van.
Ford will be taking a non-cash charge of around USD $400 million to write-down the assets for the SUVs it had originally planned to manufacture, which may lead to additional losses of up to $1.5 billion.
“We are committed to innovating in America, creating jobs and delivering incredible new electric and hybrid vehicles that make a real difference in CO2 reduction,” said Ford President and CEO Jim Farley in a statement on Wednesday.
“We learned a lot as the No. 2 U.S. electric vehicle brand about what customers want and value, and what it takes to match the best in the world with cost-efficient design, and we have built a plan that gives our customers maximum choice and plays to our strengths.”
Ford is not the only major automaker that has had to delay or cancel EV production plans as a result of declining sales, General Motors has also had to do the same.
For the second year in a row, Canadians’ interest in EVs has declined, with fewer than half of Canadians now saying they plan to make their next car purchase an electric vehicle.
A whopping 52% of potential buyers said they were “very unlikely” to consider an EV for their next vehicle purchase.
On the other hand, only 28.5% of potential buyers said they were willing to go electric, down from 34% two years ago.
“Overall, while almost half of non-EV owners are open to buying an EV for their next vehicle, interest in EVs has declined for the second year in a row, from 68% in 2022 to 56% in 2023,” said Tiffany Ding, director of insights and intelligence at AutoTrader.
While many Canadians cited the high cost of EVs as a reason for not wanting to purchase one, Farley said that Ford’s California team has been developing plans for more affordable EVs, which will first include a mid-size electric pickup to be released in 2027.
“The work of this highly talented team has evolved into a critical enabler of our electric vehicle strategy. These electric vehicles will be lower cost, and not compromised in any way,” said Farley.
Additionally, the company plans to roll out a commercial EV van from its Ohio assembly factory in 2026.
However, the much anticipated successor to Ford’s F-150 Lightning EV truck has been further delayed and won’t be available until late 2027, despite its initial plans to be out by next year.
Ford said the delay will allow for the company to take advantage of lower-cost battery technology.
The company also announced plans to shift towards hybrid vehicles, aiming to peak the interest of consumers who want longer-range vehicles for road trips.
In Canada, Ford has completely shifted away from EVs, announcing last month that it plans to build large super duty trucks at an Ontario production plant it had originally intended to use for electric vehicle production.
The automaker’s Oakville assembly complex was set to be converted into an all-electric vehicle plant but now Ford says it will be investing $2.3 billion into super duty truck production instead. Despite taxpayers committing $590 million to Ford in the form of a subsidy partnership between the federal and provincial governments to build EVs, the company has delayed all EV plans for at least the next three years and laid off employees in the sector.