Analysis: Ford EV write-down closes chapter on Obama’s electric auto experiment

US automaker Ford wrote down $19.5 billion worth of investment in electric vehicle (EV) production after decades of federal subsidies failed to provide significant market penetration.

The move marks the effective end of a political and industrial project begun by liberals under the Obama administration that sought a top-down remake of the energy market.

“We started investing again in American research and American technology and homegrown American clean energy because I don’t want solar panels and wind turbines and electric cars of the future built in Europe or Asia,” Obama said in 2010. “I want them built right here in the United States of America with American workers.”

The write-down on Ford’s investment follows delays and changes to other U.S. automaker plans on electric vehicles, including the vaunted Tesla, which has had to slash prices as federal subsidies for car buyers ended.

The 2009 Obama legislation on federal subsidies for EV purchases was written to phase out incentives as manufacturers hit certain milestones. As the milestones were reached, sales slowed as the consumer market failed to follow federal government dictates.

In 2025, Trump ended all federal EV subsidies outright.

Even with federal subsidies, EVs only accounted for 2% of all vehicles on the road as of 2024.

The implications for Ford’s actions go far beyond Detroit into state jurisdictions, where some states such as California have prepared for an EV future by essentially outlawing fossil fuels sooner rather than later.

California received federal clearance under the Biden administration to outlaw fossil fuel engines by 2035.

Ford’s announcement reflects canceled EV models, battery plants that didn’t improve prices at scale and EV production lines built for demand that didn’t arrive.

Battery prices didn’t fall enough to be competitive with fossil fuels, as they are still roughly 70% higher than a fossil fuel engine can deliver.

While raw electric costs remain relatively low in the U.S., the cost of storage, i.e., batteries, is still prohibitive, said auto executives who spoke with Reuters.

Ford is now redirecting capital toward hybrids and extended-range vehicles, conceding a pure EV strategy could not meet profitability targets under real market conditions.

Ford was not a reluctant participant in the EV transition. It was one of its most aggressive champions, making the write-down especially significant as a signal to investors and regulators alike.

“Ford’s strategic reset is a clear acknowledgement of shifting market realities and consumer demand,” Morgan Stanley analysts said, according to Reuters.

Other automakers have followed similar paths:

• General Motors delayed or slowed multiple EV launches while absorbing losses tied to its Ultium battery platform. 

• Stellantis has canceled its Ram 1500 electric truck programs and accelerated hybrids for Ram and Jeep. 

• Car and Driver has a complete list of companies and models canceled before the Ford announcement. 

Collectively, these shifts represent tens of billions of dollars in investment losses in EV across the U.S. and European auto sectors.

Even Tesla, long treated as proof of an inevitable EV-only future, has shown signs of strain.

The company has repeatedly slashed prices to stimulate demand and compress margins, signaling even the prestige EV market it created is no longer absorbing supply without incentives.

Some are even predicting Tesla will soon go into the red without the subsidies.

While Tesla remains profitable for now, its pricing strategy underscores the same reality confronting legacy manufacturers: EV demand has plateaued outside a narrow consumer band of purchasers.

The EV push did not fail because the technology stopped improving. It faltered because the transition was designed around policy props such as subsidies, which liberals thought would eventually create self-sustaining demand for the EV market.

Federal subsidies, tax credits and regulatory push-pull mandates were meant to accelerate adoption until scale economics took over.

Instead, they masked losses.

When incentives became less generous, more politically uncertain or ended outright, demand declined quickly, particularly among middle-income buyers and truck owners who account for a large share of U.S. vehicle sales.

While EVs still account for robust sales in Europe and Asia, it largely proves the U.S. case against EVs.

In China, the government actively punishes consumers who use fossil fuels, as the communist regime props up EV use.

In Europe, gasoline taxes put fossil fuel cost at $6 to $9 per gallon, more than twice U.S. prices. Also, Europeans average about 7 miles per day in a vehicle, while in the U.S., a person averages 40 miles per day, pushing EV batteries to their limits.

The consequences extend beyond automakers.

Democrats built regulatory frameworks around rapid EV adoption and now face pressure to adapt.

California’s mandate to end sales of new gasoline-powered vehicles by 2035 assumes a steady pipeline of affordable EVs and a charging network capable of supporting them.

If manufacturers continue scaling back EV output and prioritize hybrids, those assumptions weaken.

A recent example from President Joe Biden is instructive.

In 2021 the Biden budget authorized $7.5 billion to build a network of nationwide charging stations for EVs, but by 2025 fewer than 15 were operational.

Thus Ford’s write-down brings a pause to the sputtering experiment in failed federal industrial policy.

Electrification is not disappearing, but the vision of a rapid, federally directed conversion of the American auto market has collapsed.

A slower, market-driven transition remains, shaped less by political ambition than by what consumers can afford, and what companies are willing to build to make them – not federal regulators – happy.