Ford is again rolling back its EV plans, announcing on Wednesday the company will nix a planned EV SUV and delay its next generation of electric trucks as demand wanes.

“With pricing and margin compression, we’ve made the decision to adjust our product and technology roadmap and industrial footprint to meet our goal of reaching positive (earning before interest and tax) within the first 12 months of launch for all new models,” CFO John Lawler said in a statement cited by Reuters.

With an expected loss of $5.5 billion on EVs this year alone, Ford is looking to a specialized team in California to develop more affordable EVs the company expects to result in a new mid-sized electric pickup in 2027. It’s also looking to its new Tennessee Electric Vehicle Center to produce a next-generation F-Series truck the same year, a move that postpones plans for that vehicle by 18 months, The Detroit News reports.

Go Ad-Free, Get Content, Go Premium Today - $1 Trial

The Dearborn automaker expects to take a $1.5 billion hit to rearrange its EV plans, including about $400 million for the write-down of manufacturing assets for a previously planned all-electric SUV. Ford initially planned to produce that vehicle at its Oakville Assembly Plant in Ontario, Canada, but decided earlier this month to expand production of its gas-powered Super Duty trucks there instead.

Overall, Ford plans to cut spending on fully electric vehicles from 40% of annual capital spending to 30%, in line with the company’s previously stated plans to delay $12 billion in EV spending, Lawler said in a conference call cited by The News.

Instead of an EV SUV, Ford is planning to launch a hybrid SUV at an unspecified time and location. The company is also planning to start production of a new commercial van in 2026.

Other changes to the company’s EV plans include moving some battery production from Poland to the West Michigan city of Holland to qualify for federal subsidies, as well as plans to manufacture batteries in Kentucky beginning in 2025, and plans to produce cheaper lithium-iron-phosphate batteries at a new plant in Marshall, Mich. in 2026.

Go Ad-Free, Get Content, Go Premium Today - $1 Trial

“This is just the latest announcement from a traditional automaker to moderate EV growth plans in favor of hybrids,” CFRA Research analyst Garrett Nelson said. “It’s largely a response to consumer demand, as the U.S. hybrid market is both larger and growing faster than the pure battery EV market.”

Ford’s reworked plans follow a decision last year to shave $1 billion off its planned $3.5 billion BlueOval battery facility in Marshall, prompting the state to cut taxpayer subsidies for that project by 60%.

According to Cox Automotive, “The sales estimates from Kelley Blue Book show that electric vehicles accounted for approximately 8% of total new-vehicle sales in the second quarter, higher than the 7.1% share in the first quarter of the year and higher than the 7.2% recorded in Q2 last year.”

That slight increase, however, is well below Cox’s initial projection for EV sales of 9.5% for 2024. In June, Cox reworked its EV forecast to an expected 8.3% of new car sales, well behind the double digit adoption rate in European countries and China, according to the Detroit Free Press.

The resistance to EVs in the U.S. is driven by a variety of factors, from the higher initial cost compared to internal combustion engine vehicles, to a lack of charging infrastructure, to practical considerations like range and capacity.

The slower than expected sales also comes as Chinese manufacturers who are currently blocked from the U.S. continue to refine more advanced, lower priced EVs many believe could upend the U.S. market.

That has sparked “panic” in Michigan’s EV industry, the Free Press reports, and recent sales data illustrates why.

Hyundai Motor Group’s focus on pushing more affordable EVs helped the Korean conglomerate’s three brands – Hyundai, Kia and Genesis – to capture 10% of all U.S. EV sales through the first six months of 2024, according to Inside EVs.

“The company has long struggled to lure buyers away from established favorites like Toyota, Honda and Ford, and is using its more compelling EV portfolio to establish an early market lead in the fastest-growing part of the car market,” the industry publication reports.

While GM added more than 21,000 EVs to the market in the second quarter, Chevrolet’s EV sales declined by 19% year over year, while others losing ground on EV sales include Mercedes-Benz, Polestar, Porche, Volvo and VW.

“The growth will, at times, be very slow, as all-time horizons on the automobile business are vast, but the long-term trajectory suggests that higher volumes of EVs will continue over time,” Stephanie Valdez Streaty, Cox’s industry insights director, said .

Ford, of course, isn’t the only U.S. auto manufacturer struggling with the government-imposed transition to EVs.

GM announced this week it will lay off 634 employees in Michigan, and about 1,000 across the globe, as it works “to streamline the divisions operations under new leadership,” according to the Detroit News.

That decision came a week after the company recalled 20,000 Cadillac Lyriq EVs over an issue that causes the vehicle’s anti-lock braking system to activate for no reason.

That was the same week Stellantis announced it was laying off 2,450 union employees in Michigan, which followed buyouts offered in July amid “inflationary pressures” and waning interest in EVs.

Ford, GM, and Stellantis have all received billions in taxpayer subsidies from Gov. Gretchen Whitmer’s administration and aligned Democratic allies in the legislature.