Ford delays its new electric vehicle plant and cancels its three-row SUV

Automaker Ford announced this week that it will delay the opening of its electric vehicle factory in Tennessee, in addition to also canceling production of its electric SUV with three rows of seats. These changes in Ford's agenda respond to a change of strategy in a context of questioning the economic viability of electric vehicles.

Ford announced that it will prioritize the development of hybrid models, as well as electric commercial vehicles. These include a new electric commercial van to be launched in 2026, followed by two electric pickup trucks in 2027.

The pickups are expected to be full-size vans. They will be produced in 2027 at the Tennessee plant, currently under construction. A new midsize pickup truck being developed by a specialized "skunkworks" team in California will also be produced at the future Tennessee plant.

That Tennessee plant, which has cost the company $5.6 billion, was scheduled to start up by 2025. Despite the delays, Ford hopes that battery production can begin that year.

These measures are aimed at improving the capital efficiency and profitability of the electric vehicle business. But, in the short term,they will come at a cost to the company. The changes may also result in additional expenses and cash outlays of up to $1.5 billion. Ford will reflect them as special items in the quarter to which they relate.

"As we've learned in the marketplace, and we've seen where people have gravitated to, we're going to focus on where we have a competitive advantage, and that's in commercial land trucks and SUVs," Ford Chief Financial Officer John Lawler said on Wednesday.