FYI: Ford is revamping its electrification strategy in response to hybrid demand and economic challenges in the EV market.
Ford Shifts Focus from Electric to Hybrid SUVs Amid EV Market Pressures
Ford Motor Company is realigning its electrification plans to better address the rising demand for hybrid vehicles and the increasing economic pressures within the electric vehicle (EV) segment. This strategic pivot was announced on Wednesday, highlighting significant changes and new directions for the automaker.
Cancellation of Electric Three-Row SUV
Ford has decided to cancel its highly anticipated electric three-row SUV, which was initially set for a 2025 release boasting a range of up to 350 miles. Despite already investing $400 million in the project, the final cost of the revised product strategy could escalate to $1.5 billion. Along with this cancellation, Ford is reducing its annual capital expenditure on EVs from 40% to 30%.
Hybrid Technology Takes Center Stage
In place of the electric three-row SUV, Ford will now focus on developing a new lineup of three-row SUVs incorporating hybrid technology. The company also hinted at introducing a hybrid variant for its next-generation F-Series Super Duty pickup. The rationale behind this shift is the current high cost of battery technology for larger vehicles, making hybrids a more economical and practical choice.
Commitment to EVs Remains Strong
Despite the shift towards hybrids, Ford remains committed to its EV strategy. The company has announced the development of a new low-cost EV platform designed to support a variety of vehicles, including both passenger and commercial models. The first vehicle to utilize this platform will be a mid-size pickup truck slated for a 2027 release.
Upcoming Ford EVs
Several new electric models are in the pipeline:
- 2027: An all-new electric full-size truck, under the codename Project T3, set to succeed the F-150 Lightning. This project has been delayed from its initial 2025 launch to take advantage of lower-cost battery options and provide the market with more time to adapt to EVs. Production is scheduled to take place in Tennessee.
- 2026: An electric commercial van, with production planned in Ohio.
Reducing Battery Costs
Ford is taking proactive measures to cut down battery costs. They plan to build more affordable lithium iron phosphate batteries in the United States to qualify for benefits under the Inflation Reduction Act. Additionally, shifting the production of batteries for the Mustang Mach-E from Poland to the U.S. will make these batteries eligible for the act’s tax credits.
Looking Ahead
Ford has promised to provide an update on its electrification plans in the first half of 2025. This reassessment reflects an ongoing commitment to adapt and innovate in response to market demands and economic factors.
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-Steven Hale, Editor of Automotive.fyi
