This week, Ford announced it will end production of the F-150 Lightning, the electric version of its best-selling pickup truck, and take a $19.5 billion write-down tied up in its current and planned EV plans. The move marks a major reversal from Ford’s eight-year commitment to transitioning to an all-electric future. As of 2023, the company’s EV business has lost more than $13 billion. The IF-150 Lightning was designed to connect Ford’s core truck buyers to electric vehicles. Instead, a combination of policy turbulence, limited demand, rising costs and weak marketing undermined the system.
At its launch in 2022, Ford promoted the Lightning with a video showing a figure pulling the millionth iconic train. Actually, the truck is rated to tow up to 10,000 pounds when properly loaded, but doing so cuts its range almost in half, from about 320 kilometers to 160 kilometers. The commercial “They raised expectations of what they could do, and when people saw how much range was affected by towing a large trailer, they were really disappointed,” Sam Abuelsamid, automotive analyst and Vice President of Market Research at Telemetry, told the Observer.
Abuelsamid noted that gasoline-powered trucks face the same penalties while towing. “The Lightning is actually better than the gas version of the F-150 in every other way.”
However, sales did not match Ford’s wishes. The automaker had expected to sell 40,000 to 150,000 units a year, but even at a peak in 2024, it sold only 33,5100 units. In contrast, the gas-powered F-150 continues to sell hundreds of thousands of units annually.
Anticipating high demand initially, Ford relied heavily on shared parts from other vehicles in its lineup to ramp up production quickly, making the Lightning cost inefficient to build.
“Instead of increasing capacity in the short term, they should have invested in developing systems, which would have benefited other Ford electric products such as Mach-E and e-Transit,” said Abuelsamid. “Due to underutilized capacity, fixed costs were much higher than they should have been, resulting in significant losses.”
Time also worked against the Lightning. When the electric truck went live in 2022, Russia had just invaded Ukraine, disrupting the supply of nickel, a key ingredient in EV batteries. Prices went up, and Ford passed those higher costs on to customers, raising prices and further dampening demand.
Ford pivots to integrated data centers and AI
Ford is now trying to recover parts of its electric investment by introducing a hybrid version of the F-150 and shifting some battery production to AI data centers.
Ford is promoting an electric long-range vehicle, or EREV, that uses a gasoline engine to generate electricity for a battery. EREVs aim to alleviate concerns about charging time and range, but Ford did not provide a timeline for the EREV F-150.
The company is also converting some of its EV battery plants to battery systems for data centers, replacing what other battery makers have already done. LG Energy Solutions took a similar approach at its Holland, Mich., plant, which was originally planned to produce nickel manganese cobalt (NMC) cells for electric vehicles. After acquiring GM’s stake in a joint venture in Lansing, Mich., LG retooled the Holland plant to produce lithium iron phosphate (LIP) cells for grid storage and data centers.
“The data center bet, in general, is not a bad idea. Ford has a battery industry, and there is a very high demand for energy storage systems from data centers,” said Abuelsamid. “The difference … is in the timing.”
For Ford, change carries risk. “Ford has a plant planned to produce NMC pocket cells that now have to recycle LFP prismatic cells,” added Abuelsamid. “The updated equipment will likely come from China. That means it won’t be in production again until sometime in 2027, putting a heavy tax on new equipment and risking the data center bubble bursting before then.”
