Ford’s $19.5B EV loss and recall crisis shake investor trust in 2025
Ford Motors is facing a series of financial and operational challenges as 2025 draws to a close. The company has announced a $19.5 billion loss tied to its electric vehicle (EV) programme, while ongoing recalls and rising warranty costs continue to weigh on its performance.
Despite these struggles, shares have climbed by 35% this year, though the stock remains far below its mid-2023 levels.
The automaker’s troubles deepened in December after it revealed a $19.5 billion hit due to restructuring its electric vehicle division on stock market. As part of the changes, Ford cancelled production of the F-150 Lightning, a key electric pickup model. The financial impact is expected to drag on earnings through at least 2027.
Recalls have added to the pressure, with 273,000 vehicles called back in recent months over a parking malfunction. Warranty expenses surged to $2.8 billion in the first half of 2025, including a $300 million increase in the second quarter alone. Ford accounted for 35% of all US auto recalls this year, prompting the company to appoint a new quality chief in December 2024 to tackle the issue.
Despite these setbacks, Ford’s stock has rebounded somewhat, rising 35% since January. Yet the share price has not reached $15 since July 2023. The company’s valuation remains low, with a trailing price-to-earnings ratio of 11.4 and a forward P/E of 9.4—roughly a third of the S&P 500 average. Analysts warn that unresolved cost pressures and weak earnings outlook could keep investors cautious for some time.
Ford’s financial strain from electric vehicle restructuring, high warranty costs, and persistent recalls is likely to affect performance for years. While shares have gained ground in 2025, the stock’s long-term recovery depends on whether the company can stabilise quality issues and reduce expenses. For now, the automaker faces an uphill battle to restore investor confidence.
