Ford reports $8.2B net loss as EV business bleeds $4.8B
What's the story
Ford has reported a staggering net loss of $8.2 billion for the year 2025, its worst annual earnings in four years and the largest since the 2008 recession. The company's electric vehicle (EV) division alone accounted for a massive $4.8 billion of this loss. The downturn is largely attributed to poor EV sales and disrupted corporate plans across the industry after the Trump administration's move to cut a federal EV tax credit introduced by former President Biden in 2022.
Strategic shift
Shift from full electrification to partial electrification
In light of the tax credit cut, Ford announced a strategic shift from full electrification to partial electrification. The company also announced major cuts to its electric vehicle plans in December, including the discontinuation of the F-150 Lightning electric pick-up truck. "I think the customer has spoken. That's the punchline," said Ford CEO Jim Farley during an earnings call on Tuesday.
Financial forecast
Ford expects to break even by around 2029
Despite the major losses, Ford is optimistic about its future. The company expects to lose an additional $4-4.5 billion in 2026 but hopes to break even by around 2029. In the absence of a tax credit, Ford and other automakers are betting on affordability and autonomous driving to boost customer demand in the US market.
Market strategy
Ford plans $30,000 EV with 'eyes-off' driving in 2028
As part of its strategy, Ford plans to launch a $30,000 electric vehicle with "eyes-off" driving in 2028. This would be cheaper than Tesla's current affordable offerings, which start at over $36,000. However, the American EV industry is facing tough competition from Chinese electric vehicle giants that enjoy government subsidies and offer their products at unbelievably low prices.
Potential partnership
Ford in talks with China's Geely for potential partnership
To bridge the gap with Chinese automakers, Ford is reportedly in talks with China's Geely for a potential partnership. The company was also hurt by tariffs, as an unexpected change in tariff provisions in late December gave it less relief than expected and doubled its tariff-related costs to $2 billion. However, executives remain optimistic about a more stable policy environment for partnerships with the administration this year.