Does Ford's Alarming $19.5 Billion Charge Make It a Sell?

Core Viewpoint - Ford Motor Company is pivoting away from full electric vehicles (EVs) due to unprofitability and declining demand, resulting in a significant $19.5 billion charge related to business restructuring and reduced EV investments [1][4][10] Financial Impact - Ford expects to record a $19.5 billion charge primarily in the fourth quarter, with a subsequent $5.5 billion cash charge spread through 2027, mostly in the next year [4] - Despite the charge, Ford increased its adjusted EBIT guidance to approximately $7 billion for the year, aligning with earlier targets before a previous reduction [5] Strategic Shift - The company is refocusing investments from full EVs to hybrids and plug-in models, canceling plans for the next generation of large all-electric trucks in favor of smaller, more affordable EVs [6][7] - Ford anticipates that by the end of the decade, around 50% of its global volume will consist of hybrids, extended range EVs, and full EVs, a significant increase from 17% in 2025 [8] New Business Ventures - Ford is launching a new business focused on battery energy storage systems (BESS) to meet growing demand, repurposing its Kentucky battery factory and investing about $2 billion over the next two years [9] Market Position - The company is adapting its strategy to align with current market demands, moving away from high-end EVs that are not selling well, which is seen as a positive shift for the business [6][10]