$20 billion write-off. Did Ford destroy its future by “investing billions based on assumptions that vanished”?

Photo above - is this what will save Ford? The company promises to turn this tiny 3-cylinder trucklet into a hybrid by adding a battery and electric motor. But the Bronco Sport already costs $32,000 before hybridization.

Just before midnight, as 2025 ended, Ford wrote off $20 billion in losses for its cornucopia of failed EV programs. Cancelled plants, cancelled vehicles, cancelled battery production, termination of workers. Ford used an accounting entry to write off $20 billion while the whole company is only worth $50 billion (Yahoo estimate). Can a company even survive something like this? We’re about to find out.

Shares of Ford stock have NOT fallen through the floor, despite having zero earnings. It’s only down 50% from their high of $26 a share in 2022. This is probably because Ford continues to pay out a 4.7% dividend, despite having zero profits (and paying zero taxes). Don’t ask where that dividend money is coming from, or if it’s sustainable.

Ford’s CEO Jim Farley (former Toyota exec) has not been fired. He's been on the job since 2020, You probably can’t blame him for spinning a rosy prediction of endless profits fueled by Obama/Biden era EV subsidies for car buyers, new assembly lines, and public charging stations. Who WOULD’T like to get on THAT gravy train?

None of Ford’s board members have been fired either. In 2024 they added a new one – Adriana Cisnersos – an expert in “sustainability practices”. Adriana is the president of her own company (Cisneros Group), a private, family-owned business founded by her grandfather a century ago in Venezuela (It now resides in Coral Gables, Florida). Cisneros Group has several side hustles, but none apparently related to car manufacturing or EV tech.

Jim Farley is NOT the top guy at Ford. That would be William Clay Ford, Jr. The great grandson of founder Henry Ford. He probably was instrumental in green-lighting the current Jim Farley era. “Bill" Ford does have one important attribute as a kingmaker, however. He inherited 35 million shares of stock from his ancestors. That may sound like a lot, but it’s actually less than 1% of the total shares. Bill Ford has not been replaced either.

Ford Motor Company’s new survival plan is built on higher sticker prices and greater numbers of Ford 150 pickups. Which might work. This is a crazy world. Nobody is popping the hood on their Tesla at Home Depot on Saturday morning to show the cocoanut sized washing machine motor inside. And Ford will pivot to hybrids. Just put 1 KwH micro-sized lithium battery in every gasoline vehicle, and add regenerative braking. That’s also Toyota’s master plan. Toyota stock shares are now at $250 a share, up from $150. Toyota Motor Company is valued at $300 billion – 6 times as much Ford.

Will Trump era financial manipulation – tariffs on foreign made cars – succeed where EV tax rebates and outright corporate grants failed? Ford’s UAW assembly line workers and shareholders are certainly hoping so. There are going to be a LOT of unhappy people if this doesn’t work out.

I'm just sayin' . . .

Ford scraps EV flagship after biggest loss since 2009—$19.5B hit triggers 'existential threat'

$19.5B EV loss forces Ford to fire hundreds as F-150 Lightning line shuts down overnight

https://www.msn.com/en-us/autos/news/ford-scraps-ev-flagship-after-biggest-loss-since-2009-19-5b-hit-triggers-existential-threat/ss-AA1Xr0W5?ocid=msedgntp&pc=HCTS&cvid=69a7ff6874f84bb7895eac6ca8484d78&ei=23#image=11

https://www.msn.com/en-us/money/companies/19-5b-ev-loss-forces-ford-to-fire-hundreds-as-f-150-lightning-line-shuts-down-overnight/ar-AA1TrPlO

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ArishMell · 70-79, M

I could not find the first reference - MSN's presentation is such a shambles I'm surprised anyone finds anything on it!

Your second reference suggests Ford being out-competed by other EV manufacturers. Is "range anxiety" high in the USA thanks to considerable distances and uncertainty of finding chargers? (That was a significant fear in the UK, but has diminished as distances between towns and motorway service areas are modest, the number of public chargers is increasing slowly, and of course the vehicle ranges are increasing.)

The car industry was always highly-competitive, and just because a company took an early lead by being able to mass-produce relatively cheap, fairly reliable cars doesn't necessarily mean it can hold that lead a hundred years later. Especially now that the automotive industry is far more international that it was, and like all major industries far more under the thumbs of remote money-traders.

I examined the specifications of that 'Bronco'

Your heading photograph suggests it is hardly "tiny" - perhaps similar size to the Rangerover, Toyota Hilux or Ford Ranger, but like the Rangerover is a big estate-car rather than builder's or farmer's pick-up. Perhaps a bit lighter at just under a tonne and a half. It is based partly on the Ford Maverick so not entirely all-new.

Only two litres in just three cylinders? That shows how much engine design has advanced in the last few decades.

Both turbocharged, even the 1.5l "L" is still rated at just over 180HP, the 2l at 240HP.

Not to be sniffed at unless the car is so over-heavy it seriously drags its efficiency down. I don't suppose those lumbering V8 engines of the 1950s were any more powerful, and were certainly far thirstier - but they were in very heavy cars with automatic transmissions then of poor efficiency. An engine being so big its owner can brag about its bulk in a supermarket car-park doesn't make it any better!

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ArishMell · 70-79, M

@SusanInFlorida I take the performance figures for any vehicle with a pinch of salt, because they are in controlled conditions!

So I would think a maximum real range of about 0.8 that claimed, optimistic but more credible than the test figure.

It's not too bad: Car & Driver says the EPA rating for the same is 283-312 miles; fairer than the advertisement's 325. It looks quite a large, heavy vehicle, and anything over 250 miles is probably quite good for anything of that class.

Nevertheless, EVs are improving, but I can understand why they might not be attractive in a country of continent-size, and where you could probably drive a comparable Diesel-engined car for 500 miles on a single tank-full. (Whether more cheaply, I don't know.) That car's petrol version - maybe 400 miles.

Convenience comes into it too of course: I imagine you could queue for a quite a while at a charging-point at busy times.

SusanInFlorida · 31-35, F

@ArishMell if anyone's plan is to ONLY recharge their EV at a public network charger (at 3X the residential energy rate) they need to stop and think about that.

ArishMell · 70-79, M

@SusanInFlorida Quite so. That means really, owning an EV only if you ever drive within a radius of about 100 miles from home, and can recharge it there.

Those of us who cannot do that (I suppose in the US, most would be residents of urban flats) are in exactly that position.

jackson55 · M

$75.000 hybrid plckup trucks with tiny turbocharged engines ? No thanks.
The current search for tiniest improvement in fuel mileage and cost cutting has hurt quality and reliability.
That’s not just a Ford issue.

Crazywaterspring · 61-69, M

We will eventually have Chinese EVs like Canada and Mexico. American legacy car makers are retreating away from cars in favor of pick up trucks. Innovation and quality apparently are left to Asian and some European automakers.

SusanInFlorida · 31-35, F

@Crazywaterspring my told me stories about how the USA - for years - tried to keep out japanese cars. Any means possible.

import tariffs. numerical limits. crazy inspection standards. warning that they were made in a radioactive city

today they're our allies. but to be fair, they're not putting Uighurs in concentration camps or threating to invade taiwan.

Crazywaterspring · 61-69, M

@SusanInFlorida I spent several weeks in the Philippines last year. I drove a BYD almost everywhere other than Manila. It was a very nice car. Great suspension on crappy roads, strong A/C for a tropical climate and it had plenty of power. I asked a dealer the price. $US22k. American cars simply cannot compete on price. The fit and finish were quite nice. No rattles and good cabin components.

SusanInFlorida · 31-35, F

@Crazywaterspring i briefly owned a honda fit a few years ago. great for around time. deafening NVH on the interstate, however.

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SusanInFlorida · 31-35, F

@jshm2 as industries/products mature, offshore manufacturing squeezes a lot of cost out.

here are things we USED to make, but no longer do (not just cars)

refrigerators.
washing machines
televisions
personal computers
cell phones
clothing
furniture

jet aircraft and hollywood movies are the last best hope. and a lot of movie production is going to london, because the "craft" workers there can be paid 2/3 less than union workers in hollywood.

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whowasthatmaskedman · 70-79, M

Just as aside. But I have seen advertising here in Oz for (and I promise this is not a typo) 2023 Ford F 150s. Thats MY2023!!! And these would be right hand drive models.. WTF????😷

** and to prove my point, I found this
https://www.coffeyford.com.au/arriving-soon/view/2023-Ford-F150-DVDL-1FTFW1E82PFC88673/31988777

SusanInFlorida · 31-35, F

@whowasthatmaskedman nice reply. i guess this is (oz) where unsold ford inventory goes to sulk.

whowasthatmaskedman · 70-79, M

@SusanInFlorida After being converted to RHD. I assume this is a last ditch effort to move inventory no one else wants...😷

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SusanInFlorida · 31-35, F

@Ken4family stellantis (chrysler/dodge/ram/jeep) is my next prediction of a falling domino.

the jeep brand will be sold again. currently half the jeeps have italian powertrains.

the ram brand might survive too. probably toyota or mercedes might buy this.

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