Bosch cancelled its planned $200 million hydrogen fuel cell facility in South Carolina
Freyr abandoned a $2.5 billion battery plant in Georgia
Kore Power scrapped a $1.2 billion battery plant in Arizona
While EV project cancellations capture headlines, the contraction in traditional combustion engine manufacturing represents an even larger source of surplus assets. Volkswagen's announcement of 35,000 job cuts globally and a reduction of approximately 700,000 units of annual production capacity by 2030 signals a fundamental restructuring of internal combustion engine (ICE) manufacturing (Bauelectric, 2025). This is unprecedented: for the first time in Volkswagen's 87-year history, the company is threatening to close domestic German plants, marking what some analysts are calling Germany's "Detroit Moment."
How Policy Changes Are Impacting EV Adoption
The expiration of the $7,500 EV tax credit in September 2024 marked a turning point. While Q3 2025 saw buyers rushing to beat the deadline, the subsequent demand slowdown has been significant (Scurek, 2025). More than 60% of U.S. consumers now worry they will overpay for their next vehicle, and over 72% expect tariffs to make vehicles less affordable (Dale, 2025).
The market response has been swift: consumers are shifting toward hybrid vehicles, seeking a balance between cost, flexibility, and perceived risk. This pivot is forcing manufacturers to reconfigure production lines originally optimized for either pure ICE or pure EV production—creating additional waves of surplus equipment as facilities retool for hybrid flexibility.
Where Supply Chain Vulnerabilities Are Emerging
The Ford F-150 story illustrates how optimized supply chains can amplify risk. After shifting to aluminum bodies in 2015 for fuel efficiency, subsequent tariffs on aluminum combined with fire damage at Ford's largest aluminum supplier created a serious bottleneck. Ford now expects a $1.5–$2 billion EBIT impact and a loss of 90,000–100,000 F-Series trucks in Q4 (Ozsevim, 2025).
China's October 2025 export controls on rare earth minerals and refined materials have intensified the pressure, directly threatening battery and semiconductor supply chains. Toyota stated it may be forced to halt production if constraints intensify (Ozsevim, 2025).
Plant closures and project cancellations are accelerating across both traditional and EV manufacturing, with combined capacity reductions exceeding 1.5 million vehicles annually
Hybrid vehicle adoption has pivoted faster than pure EV adoption as consumers seek affordability and flexibility
Automation adoption continues surging despite overall production cuts, as manufacturers seek efficiency and flexibility
Digital auction platforms are experiencing strong growth, with the market expected to reach $59.18 billion by 2035
Sustainability focus is intensifying, particularly in Europe where ESG mandates drive asset disposition strategies
