National Review Online
Wednesday, December 17, 2025
Ford Motor Company has been on the front line of
America’s supposed electric vehicle revolution for the past five years. Now, it
has discovered that the EV market it was chasing never actually existed.
On Monday, Ford announced that it was writing down $19.5 billion in
charges, with most of the losses stemming from its flailing EV business. The
company now plans to change strategy, redirecting capital from the EV money pit
toward models that are more likely to turn a profit, including, notably, hybrid
gas-and-electric vehicles. Expect other legacy automakers that drank the EV Kool-Aid (with varying degrees
of enthusiasm) to make similar announcements in the coming months.
Ford CEO Jim Farley summed up his reasoning: “Instead of
plowing billions into the future knowing these large EVs will never make money,
we are pivoting.” The company’s electric version of its F-150 pickup truck, the
Lightning, will be scrapped. An EV battery factory in Kentucky will be transformed
into a battery storage business for industrial clients.
Green energy enthusiasts will surely blame Ford’s
staggering losses on President Trump, who signed legislation repealing EV tax
credits and rescinded fuel-efficiency mandates this year. The truth, however,
is that a mass-market EV industry was destined to struggle long before Trump
won his second term. It was conjured by central planners in Washington, not
consumer demand, and needed to be propped up by cash and coercion to survive.
No more than a sliver of the U.S. car-buying market ever desired to
purchase an EV, and no traditional automaker could conquer the market niche
that Tesla already carved out.
Policymakers began their campaign against gas-powered
cars over a decade ago. In the late 2000s, Congress attempted to midwife the EV
industry by creating a $7,500 tax credit per vehicle sold, which would phase
out after a manufacturer reached 200,000 electric cars. President Obama pledged
additional federal support in 2011 and declared a goal of 1 million EVs on U.S. roads by 2015. The
actual number? Just under 400,000.
The Obama administration’s failure to foist EVs onto
Americans didn’t deter President Biden. He spearheaded legislation to
drastically expand the federal EV tax credit in 2022, extending it to all
personal sales, as well as used and commercial vehicles.
Yet consumers still refused to buy EVs in the
numbers bureaucrats envisioned. The price of a new EV, even when partially
offset by taxpayer funds, was still far higher than that of gas-powered and
hybrid vehicles. Tax credits mostly served to subsidize affluent car buyers who would have purchased an
EV regardless and rarely bought one as their sole car, putting tens of billions
of dollars to waste.
If drivers didn’t want to buy EVs voluntarily, Biden
would have to force them. Regulatory changes introduced in 2023 and 2024 meant that automakers would need to manufacture a
certain number of EVs as a percentage of their total fleets within a decade, regardless
of real demand. By 2032, two-thirds of new cars would have to be electric to
comply.
This was a blessing (only very lightly disguised) for
major automakers, which had poured billions of dollars into EV production.
Sure, they would be prohibited from making the cars that customers wanted to
buy, but their competitors would be as well. If they wanted new cars, consumers
would have no choice but to purchase EVs, thereby paying back the foolish
investments in EV production that the government cajoled companies to make.
That is, until the 2024 election, when voters gave
Republicans a governing trifecta. Congressional Republicans repealed the EV tax
credit as part of this year’s reconciliation package, and President Trump has rolled back Biden’s regulatory dictates. Suddenly,
automakers like Ford are realizing that nobody is going to make people buy
their latest electric models or even bribe them to do it. Their investments in
EVs made sense only when Washington was pressuring the market to conform to its
fantasies, and now that pressure is gone. Automakers are finally free to meet
car buyers’ true demands — but not before government meddling cost them a
fortune.
Consumers fought the government’s schemes for them to all
own EVs every step of the way for one reason: EVs are not attractive to the
vast majority of drivers. They’re expensive, limited in range, and often
impractical to charge, and they have few advantages over gas-powered cars aside
from virtue-signaling. These are hard realities that no ad campaign or subsidy
could overcome.
If EV technology improves in the future, let it be
adopted through the free decisions of automakers and car buyers — not the
domineering hand of progressive policymakers. Ford’s $19.5 billion retreat
shows that, so far as the market is concerned, we aren’t anywhere close to that
yet.
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