LOUISVILLE, Ky. (WDRB) — Ford’s decision Thursday to delay the start of production at one of its two massive Kentucky battery plants is an acknowledgment that demand for electric vehicles hasn’t materialized as quickly as automakers anticipated, analysts said.
The question is whether the move signals a temporary blip in the much-hyped transition to electric cars, or a more fundamental shift.
Ford Motor Co. executives said Thursday that the company is delaying the start of production at the second of the two side-by-side battery plants it’s building with Korean partner SK On in Glendale, Ky.
BlueOval SK, the Ford-SK On joint venture, will finish construction of the plant. What the companies haven’t decided is when to start operating the plant.
“It could be nothing more than, ‘Let’s build it, and at some future point, we think we’re going to be able to utilize it,’” said Brian Moody, executive editor at Autotrader, an industry publication.
Moody added that the plant could be repurposed, for example, to make smaller batteries that would go into gas-electric hybrid models, including plug-in hybrids, instead of full EVs.
“Ford has been essentially saying, ‘Hey, we're gonna pump the brakes on our EV program, and wanting to invest more in hybrid technology,” Moody said. “And in fact, for most people, a hybrid would work better for where they are right now.”
The delay of production at the second Kentucky plant is among $12 billion in planned EV-related spending Ford is “pushing out” into the future, Chief Financial Officer John Lawler told analysts on the company’s earnings call Thursday.
“Given the dynamic EV environment, we are being judicious about our production and adjusting future capacity to better match market demand,” Lawler said.
Ford has projected losing $4.5 billion on its EV business in 2023, which it has described as “startup” venture nested within the century-old automaker.
The two Kentucky plants are among three EV battery plants that Ford and SK On are building. BlueOval SK’s other Kentucky plant and one under construction in Stanton, Tenn. remain on track to start work in 2025.
“Our ultimate goals have not changed, but the time to reach those goals has been revised,” BlueOval SK’s Ursula Madden said in a statement Thursday evening.
Sam Fiorani, vice president of global vehicle forecasting at industry consultant AutoForecast Solutions, said recent moves by Ford, General Motors and other carmakers to slow the pace of electric vehicle investments don’t change the bigger picture of an industry in transition.
“It’s just a growth lull that we’re looking at in between the early adopters who have already bought all their electric vehicles and mainstream buyers who will buy electric vehicles in a year or two or three,” he said.
Ford currently makes only three models of EVs, which it calls its “first generation.” CEO Jim Farley said Thursday that the company’s second- and third-generation EVs will be significantly improved.
WDRB reported Thursday that Ford is targeting Louisville Assembly Plant, which makes the gas-powered Escape SUV, for an “all new” EV in 2026.
That vehicle would be one of Ford’s “second generation” EVs and will likely be lower-priced and produced in higher volumes than the company’s current lineup, Fiorani said.
“The market could be there in (20)26-(20)27. By the time this vehicle ramps up … that product will be ready to go,” he said.
A Ford spokesman said Friday the Escape and its cousin, the Lincoln Corsair, “remain important parts of our lineup” and that company will not comment on “future product speculation.”
