Ford's Hybrid Surge Boosts Profits as EV Transition Slows

Automaker's pivot toward more profitable hybrid models pays off amid slower-than-expected EV adoption.

Published on Feb. 24, 2026

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Ford Motor Company's focus on hybrid vehicles, rather than a full pivot to electric vehicles (EVs), has proven to be a profitable strategy for the automaker. Despite initial skepticism, Ford CEO Jim Farley revealed that some of the company's U.S. hybrid models have become more profitable than their gasoline counterparts, with hybrid sales surging 22% in 2025. This shift comes as Ford's EV sales have declined, highlighting the importance of hybrids in the company's near-term profitability as the EV market develops.

Why it matters

Ford's pivot toward hybrids, rather than an all-in approach on EVs, demonstrates the automaker's pragmatic focus on profitability in the near term. This is crucial for investors as Ford's EV division, Model e, has been losing billions, while its hybrid models are driving significant gains. The success of Ford's hybrids underscores the importance of diversified powertrain strategies as the auto industry navigates the transition to electrification.

The details

Ford CEO Jim Farley revealed that the company's hybrid models have become more profitable than their gasoline counterparts, with some U.S. hybrid models now covering the cost premium for the technology. This shift has been driven by strong customer demand, as Ford sold more than 228,000 hybrids in the U.S. throughout 2025, a 22% increase over the prior year. The F-150 hybrid remained America's best-selling full-size hybrid pickup, a crucial segment for Ford's profitability. Meanwhile, Ford's EV sales declined 14% in 2025 and plunged 52% during Q4 as the market adjusted to the loss of the federal EV tax credit.

  • In May 2024, Ford CEO Jim Farley commented that the company's hybrid models were becoming more profitable than their gasoline counterparts.
  • Throughout 2025, Ford sold more than 228,000 hybrids in the U.S., a 22% increase over the prior year.
  • In Q4 2025, Ford's EV sales plunged 52% after the loss of the federal EV tax credit.

The players

Jim Farley

The CEO of Ford Motor Company, who has overseen the automaker's pivot toward more profitable hybrid models as the EV market develops.

Ford Motor Company

An American multinational automaker that has found success in its hybrid vehicle lineup as it navigates the transition to electrification.

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What they’re saying

“A year ago, we weren't covering the cost premium for hybrids with the price that customers paid us. We are now. Customers are voting. They like these in-between solutions.”

— Jim Farley, CEO (Automotive News)

What’s next

Ford is continuing to develop its Universal EV Platform and plans to introduce a midsize electric pickup in 2027, signaling its commitment to expanding its EV offerings in the coming years.

The takeaway

Ford's focus on profitable hybrid models has paid off, highlighting the importance of a diversified powertrain strategy as the auto industry navigates the transition to electrification. This approach has allowed Ford to maintain strong profitability in the near term, even as the EV market develops at a slower pace than initially expected.