Originally posted on December 17, 2025.
Government’s Failure to Run a Business
In the WSJ, the editors explain how market realities are slamming the brakes on vehicles of the future. Watch, they advise, what will happen to EVs with subsidies and mandates gone.
The business case for EVs has always rested largely on government subsidies and mandates.
According to the Journal, Ford Motor’s stunning announcement Monday is that it will take a $19.5 billion write-down on its electric-vehicle business.
This will be among the largest impairments taken by a company and marks the U.S. auto industry’s biggest reckoning to date that it can’t realize its electric-vehicle ambitions anytime soon., reports the editors of the WSJ.
Slamming on the Breaks like a 16-Wheeler
Since 2023, Ford has lost $13 billion on its EV business. To bolster Ford’s goal of pulling back from loss-making assets and redeploying capital designated for EVs to models with higher profitability, it will shift to hybrid and so-called extended-range electric vehicles that include onboard gasoline engines.
According to Ford CEO Jim Farley
“Instead of plowing billions into the future knowing these large EVs will never make money, we are pivoting. We now know enough about the U.S. market where we have a lot more certainty in this second inning” of reduced-emissions powertrains.”
Is Selling at a Loss a Business Plan?
Changes in regulations and a lackluster demand from Americans are forcing U.S. automakers to abandon plans to quickly step to an electric-vehicle future. According to the WSJ, Ford, which had bet big on EVs, is now making one of the industry’s biggest changes to its business.
Ford remains on track to produce a $30,000 EV pick-up for sale by 2027, which the company says will be the first in a new string of low-cost EVs. According to CEO Farley, “Now this is the core of our EV strategy in America. We’ve got to land the plane.”
Ending the Lightning
No longer being produced is the EV version of its F-150 pickup truck, called the Lightning. Instead, it will make an extended-range version of the truck. Last month, The Wall Street Journal reported that company executives were discussing scrapping the EV version.
Ford expects that by 2030, half its global volume will consist of hybrids, extended-range vehicles, and EVs.
The shift to hybrids is accelerating around the world, as those vehicles are increasingly seen as more affordable and practical to consumers who are reluctant to commit to pure EVs.
Demand fell off a cliff after the GOP tax bill eliminated the tax credit in October.
The tax bill also eliminated the penalty for noncompliance with the fuel economy mandates. Earlier this month the Trump Administration announced it will ease fuel-economy rules through 2031.
The GOP bill also eliminated the tax credit, which contributed to Ford’s EV sales falling 60%, compared to prior years.
To boost revenue, Ford will reconfigure its Kentucky EV-battery factory into a battery-storage business for customers (such as utilities, wind- and solar-power developers, and massive data centers that train artificial intelligence).
Plans are in the works for Ford to hire thousands of new employees across the U.S., though some 1,600 workers at the battery plant will be laid off while it gets repurposed. Ford reported net income in 2024 of $5.9 billion on $185 billion in revenues. On Monday, the company also raised its earnings forecast for the year to $7 billion in adjusted pretax earnings, up from $6 billion to $6.5 billion.
The company’s pivot from EVs is an indication that Americans can expect their roadways to look much as they do today, with many gas-powered cars and trucks and growing use of hybrids.
The Joe Biden administration tried to induce the auto industry and drivers to fully and rapidly embrace the EV movement. This year alone, the Trump administration eliminated some of the strictest clean-air and fuel economy mandates.
High sticker prices kept many consumers away from EVs. Worries over battery range and access to charging stations didn’t help the cause, either.
According to the WSJ, Ford, in addition to canceling the all-electric F-150, is scrapping plans for another electric truck and for electric commercial vans.
General Motors, forced to retreat from plans to have an all-EV lineup by 2035, wrote down $1.6 billion in EV assets in the third quarter and signaled that more write-downs are in store as it pulls back on EV capacity. GM recognized that equipment it bought for a planned EV factory was wasted once the company decided to make gas vehicles there instead.
