Ford Motor Co.’s electric vehicle (EV) sales dropped sharply by 31.4% in the second quarter of 2025, largely due to a safety-related stop-sale of its popular Mustang Mach-E. The recall, affecting over 317,000 vehicles globally, stems from a software glitch in the electronic door latches that could trap occupants inside, posing serious risks. This setback, combined with inventory shortages, has disrupted Ford’s EV momentum, prompting a strategic pivot toward affordable models, reports Bloomberg.

Safety Flaw Halts Mustang Mach-E Sales

The Mustang Mach-E, Ford’s flagship electric SUV, faced a mandatory sales halt in June 2025 after a defect was identified in its electronic door latch system. The issue, which could cause a “lock-out condition,” risks trapping occupants, including children or pets, inside the vehicle, especially in hot weather.

Ford recalled approximately 197,432 Mach-Es in the U.S. from model years 2021 to 2025 to address the glitch with a software update expected in Q3 2025.

“The Mach-E is our top seller at Ford, and we can’t sell it,” said Beau Boeckmann, president of Galpin Motors in Southern California reportedly. “Right before the Memorial Day sale, we had to stop selling it. That is really affecting our business.”

The recall significantly impacted sales, with Mustang Mach-E deliveries falling 19.5% to 10,178 units in Q2 2025 compared to the same period in 2024. The stop-sale compounded existing inventory challenges, as Ford transitioned to 2025 model-year production, leaving dealers with limited stock.

“Our dealers can’t sell what they don’t have,” said Ford spokesperson Said Deep. “We expect the flow of Mustang Mach-E inventory released for sale to increase across July.”

Broader EV Sales Decline and Inventory Woes

Ford’s EV lineup faced additional challenges beyond the Mach-E recall. The F-150 Lightning, Ford’s electric pickup, saw a 26.1% sales drop to 5,842 units, while E-Transit van sales plummeted 88% to just 418 units, with only 97 sold in May. These declines were partly due to factory shutdowns for model-year changeovers, which reduced available inventory. [Bloomberg]

Despite the EV downturn, Ford’s overall U.S. vehicle sales rose 14.2% in Q2, driven by strong demand for gasoline and hybrid models. The F-Series, including gas and hybrid versions, saw an 11.5% sales increase to 216,617 units, and hybrid sales jumped 23.5%. Ford’s employee-pricing-for-everyone discount program further boosted demand for its non-EV offerings, highlighting a stark contrast with its struggling EV segment. [Bloomberg]

Ford’s Strategic Shift to Affordable EVs

The Q2 sales slump underscores broader challenges in Ford’s EV strategy. High costs and cooling demand for premium EVs have prompted the company to refocus on affordability. Ford is developing a new line of electric models starting under $30,000, set to launch in 2027. This move aims to capture a wider market and compete with rivals like Tesla and Hyundai, who are gaining ground in the U.S. EV market. [Bloomberg]

The recall and sales decline also highlight the technical and economic hurdles Ford faces. The Mustang Mach-E, built in Mexico with only 13% U.S. content, is subject to higher tariffs, increasing costs. Meanwhile, regulatory uncertainty, including potential cuts to federal EV tax credits, could further dampen demand. [Wolf Street]

Looking Ahead

Ford anticipates a rebound in Mach-E sales once the software fix is deployed and inventory levels stabilize. However, the Q2 downturn signals the need for robust quality control and a faster transition to cost-competitive EVs. As Ford navigates these challenges, its ability to deliver reliable, affordable electric vehicles will be critical to regaining momentum in the rapidly evolving EV market.

Photo credit EVXL