Ford shifts focus from electric vehicles to grid storage amid massive asset writedown

Ford Motor Company has written down roughly $19.5 billion of EV-related assets and announced a sweeping strategic reset that abandons several fully electric vehicle programmes while redirecting capacity into stationary battery production, a move that will cut deeply into its book value and reshape its manufacturing footprint.

According to Canary Media via The Energy Mix, the charge reflects Ford’s decision to dissolve its joint venture with South Korea’s SK On and to scale back or cancel planned EV models, including the all‑electric F‑150 Lightning and a next‑generation electric truck codenamed T3. The company said in a statement the restructuring is a “decisive redeployment of capital,” and that it will retool facilities towards hybrids, extended‑range models and a new push into grid‑scale energy storage.

The accounting hit amounts to more than 40% of Ford’s book value as of September 30, and will include substantial cash costs. Analysts cited by Proactive Investors expect about $5.5 billion in related cash outflows to be paid in 2026 and 2027, while Forbes reported the company has lost more than $12 billion on its EV effort since 2023 and expects much of the charge to land in the fourth quarter of 2025 and into 2026 and 2027.

The writedown has immediate labour and regional consequences. Canary Media reported that Ford will lay off roughly 1,600 employees at its Glendale, Kentucky battery plant, and that a factory in Tennessee will hire about 1,000 fewer workers than planned after switching to production of internal‑combustion trucks. Ford will keep the Kentucky plant under its control while SK On will take ownership of the battery factory at BlueOval City near Memphis.

At the same time, Ford plans to repurpose underused battery capacity to enter the grid storage market. The company announced plans to spend about $2 billion over two years to produce lithium‑iron‑phosphate cells and integrate them into 20‑foot, 5 MWh containers, with a production target of at least 20 GWh annually by the end of 2027. Ford also intends to make cells for home storage at its Marshall, Michigan factory. “This strategic initiative will leverage currently underutilized electric vehicle battery capacity to create a new, diversified, and profitable revenue stream for Ford,” the company said.

Industry observers say the pivot responds to diverging market dynamics: US consumer EV demand has softened while utility and commercial demand for stationary storage has surged. “They have built up battery manufacturing capacity, and now they need to do something with it,” Pavel Molchanov, managing director for renewable energy and clean technology at Raymond James, told Canary Media. He added that “U.S. EV sales have never lived up to expectations,” and that the recent end of a federal consumer EV tax credit and lower gasoline prices have made EVs less attractive to many buyers. “In terms of commodity prices, this is the worst of both worlds for EVs,” he said.

Government policy has been a key factor. The Guardian and other outlets report Ford’s retreat has been accelerated by policy changes under the Trump administration that have reduced federal support for consumer EV purchases and relaxed emissions rules. At the same time, the administration preserved and reframed incentives for domestic grid storage under recent legislation, while introducing sourcing requirements that from 2026 will favour US‑made battery cells for tax credit eligibility. Industry bodies such as the Energy Storage Coalition have concluded that US cell production for grid storage could reach self‑sufficiency by the end of 2026, creating a potential market for newly repurposed domestic capacity.

The market shift is already visible in corporate accounts. Revenue from Tesla’s energy division grew sharply in the most recent reporting year, and industry data shows record US installations of battery capacity on the grid in 2025. Hyperscale data‑centre operators are among the fastest‑growing buyers, using batteries to unlock capacity and defer costly grid upgrades. Ford has signalled it will target such commercial customers for its packaged storage product.

That market opportunity, however, is competitive. Firms such as Tesla, Fluence and established storage integrators have longer track records in grid products and deeper software and systems integration experience than most automakers. Ford’s decades‑old reputation for reliable vehicles does not automatically translate to energy‑systems sales, and analysts warn execution risks are significant.

Ford frames the move as a pragmatic recalibration rather than an abandonment of electrification. The company says it still aims for a mix of hybrids, extended‑range EVs and full EVs to reach 50% of global volume by 2030, a target reported by The Guardian. Yet the scale of the writedown and the decision to discontinue marquee electric models underline how much Ford’s near‑term product strategy has been reshaped by slower EV adoption in the US and shifting policy incentives.

The retreat also revisits an earlier pattern of retrenchment. In 2023 Ford postponed about $12 billion of planned EV investment after customers showed reluctance to pay a premium for electric models, a decision reported by CNBC. The latest announcement marks a more radical reallocation of capital, reallocating billions of dollars of battery capacity from cars to stationary storage and signalling a broader strategic bet: that the fastest route to monetising large‑scale cell production in the US may now be the grid rather than the road.

For industrial decarbonisation professionals, Ford’s shift highlights several practical implications. It will accelerate the development of additional domestic cell manufacturing capacity for grid projects, potentially easing near‑term supply constraints for storage developers subject to new sourcing rules. It will also intensify competition in packaged storage, pushing incumbents and new entrants to sharpen product differentiation on performance, safety, integration and lifecycle services. Finally, the move underscores how sensitive corporate electrification strategies are to policy settings and commodity price swings, and how quickly capital can be redeployed from vehicle electrification to other decarbonisation markets when economics and regulation change.