The Ford Motor Company is canceling plans for an electric three-row SUV and is instead replacing it with hybrid models as car manufacturers adjust to a market with less-than-expected EV demand. 

Previously, the auto giant had said it would delay plans for the new electric vehicle by two years, for a 2027 release date. On Wednesday, however, Ford announced it will be scrapping the model altogether, citing cost-conscious EV customers and amplified pricing pressures. 

“We are committed to innovating in America, creating jobs, and delivering incredible new electric and hybrid vehicles that make a real difference in CO2 reduction,” Ford President and CEO Jim Farley said. “We learned a lot as the No. 2 U.S. electric vehicle brand about what customers want and value and what it takes to match the best in the world with cost-efficient design, and we have built a plan that gives our customers maximum choice and plays to our strengths.” 

The company has said its EV business is expected to lose about $5 billion this year. The change to hybrid, which has a shorter battery range but a longer overall range when combined with gas, is expected to cost $400 million and could result in additional expenses and cash expenditures of up to $1.5 billion.  

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The company will continue to make EVs, however, but at a slower pace. It will start making an EV commercial van in 2026 and two new pickup trucks in 2027. Ford will also decrease its mix of annual capital expenditures dedicated to EVs, from about 40% to 30%. 

Notably, the company is retiming the launch of its second-generation pick-up to the second half of 2027, noting that the delayed launch will allow the company to “utilize lower-cost battery technology and take advantage of other cost breakthroughs while the market continues to develop.”