Ford Motor recently announced that it will be delaying the production of a next-generation all-electric pickup truck at a new plant in Tennessee. Instead, the company is canceling plans for a three-row electric SUV and shifting its focus towards the development of hybrid models and electric commercial vehicles. This decision comes as Ford aims to better deliver a capital-efficient and profitable electric vehicle business, according to Ford CFO John Lawler.
The new plan includes the production of a full-size electric truck at the Tennessee plant in 2027, as well as a new midsize truck being developed by a specialized team in California. The company will also introduce a new electric commercial van in 2026. These changes will result in a special noncash charge of about $400 million for Ford, and may lead to additional expenses and cash expenditures of up to $1.5 billion.
Ford’s decision to prioritize the development of hybrid models and electric commercial vehicles is based on market trends and customer preferences. The company has recognized a shift in consumer demand towards commercial trucks and SUVs, leading to this strategic realignment of its electric vehicle portfolio. Lawler mentioned that Ford has been listening to customer feedback and aims to provide more electrification choices in response to market demands.
While Ford’s future capital expenditure plans will shift from spending 40% on all-electric vehicles to spending 30%, the company remains committed to advancing its electric vehicle lineup. Ford will continue to produce and update its current all-electric vehicles, including the Ford Mustang Mach-E crossover and F-150 Lightning pickup truck. The automaker plans to provide investors with an update on electrification, technology, profitability, and capital requirements in the first half of 2025.
Overall, Ford’s decision to delay the production of the next-generation all-electric pickup truck and cancel plans for a three-row electric SUV reflects the company’s commitment to adapting to market trends and consumer preferences. By prioritizing the development of hybrid models and electric commercial vehicles, Ford aims to establish a capital-efficient and profitable electric vehicle business. As the automotive industry continues to evolve towards electrification, it is crucial for automakers like Ford to remain agile and responsive to the changing landscape.
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