Ford to shift EV strategy by building new lower-cost pickup, commercial van

Facing competition from automakers with lower costs, Ford Motor Co is shifting its electric vehicle strategy and now will focus on making two new electric pickup trucks and a new commercial van. The company says all will cost less, have longer range and be profitable within a year of reaching showrooms.

Ford, which is losing millions on its current EVs, gave few details about the new products. But it said production of its next generation full-size electric pickup truck in Tennessee will be delayed 18 months, until 2027.

The company also says it won't build fully electric three-row SUVs due to high battery costs, but instead will focus on making those vehicles as gas-electric hybrids.

The other new pickup will be mid-sized, based on new underpinnings developed by a small team in California. It also will go on sale in 2027. Production of the unspecified van will start at an assembly plant west of Cleveland in 2026.

The changes will force Ford to write down $ 400 million of its current assets, and it also expects to have additional expenses of up to $ 1.5 billion.

We're committed to creating long-term value by building a competitive and profitable business, Chief Financial Officer John Lawler said in a statement.

The company also said it will cut capital spending on EVs. It now will spend 30 per cent of its annual capital budget to develop them rather than the current 40 per cent.

Ford, which has long been talking about making profitable EVs, lost $ 2.46 billion on them in the first half of the year, dragging down profits from its gas-powered and commercial units.

The company said in a prepared statement that the global EV market is changing rapidly, and it must evolve to compete with Chinese automakers that have lower production and engineering costs.

At the same time, current buyers are more cost-conscious than early adopters, and automakers are introducing more EVs.

These dynamics underscore the necessity of a globally competitive cost structure while being selective about customer and product segments to ensure profitable growth and capital efficiency, the company said.

Shares of Ford rose 1.4 per cent in trading before Wednesday's opening bell.