{"id":97206,"date":"2026-02-21T09:00:16","date_gmt":"2026-02-21T12:00:16","guid":{"rendered":"https:\/\/automotive.einnews.com\/article\/894338477"},"modified":"2026-02-21T09:00:16","modified_gmt":"2026-02-21T12:00:16","slug":"end-of-electric-vehicle-euphoria-triggers-65bn-hit-for-carmakers","status":"publish","type":"post","link":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/2026\/02\/21\/end-of-electric-vehicle-euphoria-triggers-65bn-hit-for-carmakers\/","title":{"rendered":"End of electric vehicle euphoria triggers $65bn hit for carmakers"},"content":{"rendered":"
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Carmakers were forced to overhaul their EV product and investment plans following a radical reversal in climate policy in the US<\/span> \u00a9 FT montage\/Reuters<\/span><\/figcaption><\/figure>\n<\/div>\n
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A reversal in electric vehicle ambitions has resulted in a hit of at least $65bn for the global car industry in the past year as executives warned of more pain ahead in resetting their strategies. <\/p>\n

Carmakers were forced to overhaul their EV product and investment plans following a radical reversal in climate policy in the US, with companies that had made the biggest pivot away from petrol hit the hardest. <\/p>\n

This month Stellantis took a $26bn charge<\/a> to scrap some fully electric models and revive the popular 5.7-litre \u201cHemi\u201d V8 engine in the US. It also recently decided to revive diesel engines for several European models. The write-off triggered a share sell-off that cut its market value by about $6bn.<\/p>\n

The owner of the Peugeot, Fiat and Jeep brands had previously set a goal that EVs would account for all its European passenger vehicle sales by 2030 and half the total in the US.<\/p>\n

The cancellation of EV credits in the US and President Donald Trump\u2019s determination to further roll back regulations to cut vehicle emissions mean industry executives now expect EVs to account for just 5 per cent of America\u2019s new vehicle market in the coming years \u2014 about half the current level.<\/p>\n

Rival Ford recently disclosed a $19.5bn writedown<\/a> as it cancelled its electric F-150 pick-up truck, while Volkswagen, Volvo Cars and Polestar have all suffered hits to their EV programmes over the past year. <\/p>\n

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In addition to sweeping regulatory changes in the US, Bernstein analyst Stephen Reitman said Stellantis and other carmakers left consumers behind as they tried to replicate the early success Tesla<\/a> had when it revolutionised the EV market in the US. Their shortcoming was failing to offer vehicles that met drivers\u2019 price and range expectations, while charging infrastructure was also lacking.<\/p>\n

Since then, Tesla too has suffered a significant decline in EV sales due to competition from Chinese rivals and backlash to Elon Musk\u2019s political activism, prompting it to end production<\/a> of its top-end Model S and X cars.<\/p>\n

\u201cEveryone got caught up in the kind of euphoria of \u2018look at the valuations Tesla was getting\u2019\u2009.\u2009.\u2009.\u2009and they didn\u2019t bring the customers with them,\u201d Reitman said. <\/p>\n

Analysts warned that there could be more writedowns for Stellantis ahead as the group aimed to improve its US market share with a renewed focus on hybrid and petrol models.<\/p>\n

\u201cThe prospect of further one-off costs, with unknown cash implications, gives us reason to remain cautious,\u201d Michael Tyndall, senior global autos analyst at HSBC, wrote in a report this month. <\/p>\n

Honda, the only Japanese carmaker to say it planned to stop making petrol and diesel vehicles by 2040, this week forecast $4.5bn of annual losses related to EV models, including $1.9bn of writedowns.<\/p>\n

The group warned investors there might be more charges to come as it reassessed its EV strategy and negotiated the end of its EV partnership in the US with General Motors, which itself has written down $7.6bn on its EV operations.<\/p>\n

\u201cThe EV market is dramatically changing,\u201d said Honda\u2019s executive vice-president Noriya Kaihara. \u201cSo we would need to monitor our sales volume trends and then we might have to take some [further] actions if needed.\u201d<\/p>\n

GM chief executive Mary Barra said its \u201cend game\u201d would remain electric vehicles, echoing other carmakers that have pledged to continue longer-term investments in the shift away from internal combustion engines. <\/p>\n

As the pace of the electric transition diverges in the key markets of the US and China, it will become even more costly for carmakers to offer a variety of models, from EVs and hybrids to petrol. <\/p>\n

Ford chief Jim Farley<\/a> told investors last week that the regulatory environment globally was the \u201cwildcard\u201d as the carmaker refined its strategy and investments.<\/p>\n

However, he added: \u201cThere\u2019s enough choice around the world on electrification for us to cherry-pick customers\u2019 choices around the world and come up with the right strategy, not only in the US but around the world.\u201d<\/p>\n

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Climate Capital<\/h3>\n
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Where climate change meets business, markets and politics. Explore the FT\u2019s coverage here<\/a>.<\/p>\n

Are you curious about the FT\u2019s environmental sustainability commitments? Find out more about our science-based targets here<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n

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