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Ford has announced adjustments to its EV strategy to focus on developing more affordable models to compete in the evolving EV market.
At the center of this new strategy is a medium-sized electric pickup truck, set to launch in 2027.
To pursue this new roadmap, the American automaker also said it would be putting the brakes on its previously announced three-row electric SUV, opting instead to focus on where it has competitive advantages such as mid-size and large pickup trucks, long-range SUVs and commercial vans.
As part of its revised plan, the company also plans to move some battery production from Poland to the United States in 2025 to take advantage of government incentives provided by the Inflation Reduction Act.
These changes come as Ford grapples with financial challenges in its EV division, which is projected to lose $5 billion this year. The company poured $30 billion into its EV efforts in 2021 with the hope of seeing a sustained increased demand for EV vehicles. However, given the low turnout in global EV sales, the company is reducing its capital spending on EVs from 40% to 30% of its budget.
Ford’s strategy shift reflects broader industry trends where automakers face slower-than-expected demand in the fully electric vehicle segment amid the high cost of battery material. This has forced more American EV automakers to look towards the hybrid option which is projected to attract more sales. This and rising battery material costs have led many EV automakers to re-evaluate their electrification timelines.
Ford’s CEO, Jim Farley, emphasized the importance of battery costs in remaining competitive, stating, “An affordable electric vehicle starts with an affordable battery. If you are not competitive on battery cost, you are not competitive.”
Ford has not revealed the name or specific details of the upcoming electric truck, but it is likely to be a major competitor in a market currently dominated by the Tesla Cybertruck and the recently introduced Rivian R1T.
