On Friday, Ford Motor Company announced a reduction in production for its F-150 Lightning pickup truck, citing lower-than-expected demand for electric vehicles (EVs). The No. 2 U.S. automaker revealed plans to cut production at its Michigan Rouge Electric Vehicle Center to one shift, effective April 1, as part of its strategy to balance growth and profitability.
Ford CEO Jim Farley stated, “We are taking advantage of our manufacturing flexibility to offer customers choices while balancing our growth and profitability.” This decision follows Ford’s earlier announcement in October 2022, indicating the temporary reduction of one of three shifts at the Michigan plant responsible for building the electric F-150 Lightning.
The move reflects a broader trend of slowing demand for EV trucks, with General Motors delaying the opening of a USD 4 billion electric truck plant in Michigan for a year back in October. Ford informed suppliers in December that it aimed to produce approximately 1,600 F-150 Lightning EV trucks per week starting in January, down from the initial plan of 3,200.
Despite selling 24,165 F-150 Lightning trucks in the United States last year, marking a 55% increase over 2022, Ford’s decision underscores the challenges in the EV market. The automaker had set ambitious targets for the plant, hoping to achieve an annualised production rate of 150,000 vehicles by October.
This production cut comes amid a broader industry debate over the Biden Administration’s emissions rules, with Detroit automakers expressing concerns about potential regulations leading to 67% of all new vehicles being EVs by 2032. The Environmental Protection Agency (EPA) has submitted its proposal to finalise vehicle requirements to the White House for review, prompting discussions and pushback from the automotive sector.
The decision impacts 1,400 workers at the plant, with Ford stating that about 700 employees will transfer to its Michigan Assembly Plant, while others will be placed in various roles at the Rouge Complex or other facilities in Michigan. Some may also opt for a special retirement program.
Ford, which lost an estimated USD 36,000 on each of the 36,000 EVs delivered in the third quarter, emphasised its focus on hybrid models and the commercial vehicle unit. The company aims to quadruple sales of gas-electric hybrids over the next five years, aligning with the industry trend of legacy car manufacturers emphasising hybrid models amid shifting buyer preferences. Ford anticipates continued global EV sales growth in 2024, albeit “less than anticipated.”