Ford records $19.5 billion special fee related to electric vehicle recall

DETROIT — ford motor The company announced Monday that it expects to record about $19.5 billion in special items related to restructuring its business priorities and divesting in all-electric vehicles.

The Detroit automaker said most of these charges will occur during the fourth quarter. That will be followed by $5.5 billion in cash to be collected through 2027, the bulk of that amount to be paid next year, Ford said.

The charges will impact the automaker’s bottom line results but not its adjusted earnings. The automaker said Monday it is increasing its guidance for adjusted EBIT to about $7 billion in 2025. That’s in line with the target earlier this year, before the company cut expectations to between $6 billion and $6.5 billion in adjusted EBIT in October.

The charges announced Monday, including an $8.5 billion write-down of electric vehicle assets, are linked to major changes in Ford’s business plans.

New plans include refocusing investments on hybrid vehicles, including plug-in models rather than pure electric vehicles; scrapping the next generation of all-electric large trucks in favor of smaller, more affordable electric vehicles; And rebalancing its investments in basic products such as trucks and SUVs.

These changes are the latest under Ford CEO Jim Farley and his “Ford+” restructuring plan has taken many different forms since he initially announced it as a growth plan for electric vehicles in 2021.

The electric vehicle sector saw sales decline domestically after the Trump administration put an early end in September to a $7,500 federal tax credit previously available to buyers of electric vehicles in the United States.

“This is a customer-driven transformation to create a stronger, more resilient and more profitable Ford,” Ford CEO Jim Farley said in a statement Monday.

Ford also said Monday that its all-electric F-150 Lightning pickup truck will transition to an extended-range electric vehicle, or EREV, that includes an electric powertrain plus a gas-powered generator, and announced plans to use battery plants in Kentucky and Michigan for new stationary energy storage business.

Ford said the changes are expected to provide a “path to profitability” for its Model e electric vehicle business by 2029, targeting annual improvements starting in 2026. The automaker also said it expects the changes to improve profits at its traditional Ford Blue unit and its Ford Pro business and fleet “over time with early signs of benefits emerging in 2026.”

The automaker said it expects nearly 50% of its global volume by 2030 to be hybrids, EREVs and all-electric vehicles, up from 17% in 2025.

“These are big decisions that we believe will pay dividends for years to come for our customers, our employees, American jobs and manufacturing,” Andrew Fricke, president of Model e and Blue, said Monday during a media call. “Ford follows the customer. We look at the market as it is today, not as everyone expected it to be five years ago.”

Ford said it will focus development of its North American electric vehicles on a new, low-cost, flexible “global EV platform” that is expected to support a “large-scale family of smaller, highly efficient and affordable electric vehicles.”

The first vehicle from the new platform will be a “fully connected midsize pickup truck” assembled at the company’s Louisville assembly plant starting in 2027.

The company also expects its new storage business to be producing and shipping units by 2027 for things like “data centers, the electrical grid and more,” Frick said.

“This is a compelling opportunity. It is a market with huge potential and strong demand,” he said. “We will have 20 gigawatt hours of annual capacity for this market.”

Ford shares closed Monday at $13.65, down less than 1%. Ford stock as of Monday’s close was up nearly 40% this year.