Ford CEO: EV Market Will Be 'Way Smaller Than We Thought'
Trump Policies Spur Automakers to Delay EV Investments
Key Takeaways:
- Ford CEO Jim Farley warned Sept. 30 that U.S. electric vehicle sales could fall to 5% of the market as Trump administration policies favor gas-powered cars.
- He cited the loss of a $7,500 tax credit, looser emissions rules and Ford’s $5.5 billion projected EV losses this year as major drags on demand.
- Farley said Ford will expand hybrid production at EV plants, reflecting a broader industry pivot away from all-electric vehicles under current policy conditions.
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Ford Motor Co.’s leader warned of a bleak outlook for electric vehicles as President Donald Trump’s policies breathe new life into gas-powered cars.
The elimination of a $7,500 consumer tax credit and softening of emissions rules will sharply curtail EV demand in the U.S., according to CEO Jim Farley. He predicted the share of zero-emission vehicles — currently around 10% of the domestic market — could fall by half.
“I wouldn’t be surprised if EV sales in the U.S. go down to 5%,” he said Sept. 30 in a speech in Detroit at a conference Ford is hosting on blue-collar jobs. The EV market will be “way smaller than we thought.”
The blunt assessment underscored the rapidly changing dynamics for the auto industry under Trump, with many major manufacturers delaying EV production plans and redeploying investment dollars to internal-combustion-engine and hybrid vehicles. Ford has emphasized consumer choice in fuel types while shifting its EV strategy to one around lower-cost vehicles.
Ford’s electric vehicle unit, Model-e, lost about $1.3 billion in the second quarter and the company has forecast that it could lose as much as $5.5 billion on EVs this year. Its U.S. EV sales plunged 31% in the quarter, hurt by aging models and a temporary halt in sales of the electric Mustang Mach-e due to a safety recall.
Farley on Sept. 30 said he sees more opportunity in “partial electrification,” such as gas-electric hybrids. He believes pure EVs are best suited for commuter vehicles that make “short runs” and account for only 5% to 7% of the market.
He said Ford is looking to add hybrid production to its battery and EV plants.
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“We have to make these partial electric vehicles in the factories that would have been EVs,” Farley said. “What do we do with all these battery plants? And we will fill them, but it will be more stress” because of policy changes from the Trump administration.
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