In a week that saw the electric vehicle (EV) industry rocked by major setbacks and shifting priorities, the global outlook for battery-powered cars has turned decidedly uncertain. Once the darling of policymakers and investors alike, the EV transition is now facing headwinds from every direction: waning government support, changing consumer sentiment, and a dramatic pivot by some of the world’s largest automakers. The consequences are rippling through the supply chain, with South Korean battery manufacturers—long considered the backbone of the EV revolution—bearing the brunt of the turmoil.
Shares of top Korean makers of electric vehicle batteries and battery materials slumped sharply in the week leading up to December 19, 2025, as noted by The Korea Times and Reuters. The downturn was triggered by a series of bombshell announcements on both sides of the Atlantic. On December 16, US automotive giant Ford Motor revealed a staggering $19.5 billion writedown and the cancellation of several EV models, including the much-touted F-150 Lightning electric truck. Ford’s move wasn’t just a matter of corporate strategy—it signaled a broader retreat from battery-powered models, as the company pivoted hard into gas and hybrid vehicles. This shift, according to reporting from Reuters, was widely interpreted as a response to the pro-fossil fuel policies of the Trump administration, which has rolled back fuel-efficiency standards and eliminated federal EV subsidies.
The next day, Ford’s decision had immediate consequences for its suppliers. South Korea’s LG Energy Solution (LGES) disclosed in a regulatory filing that Ford had terminated an EV battery-supply deal worth about 9.6 trillion won ($6.50 billion), a contract that was supposed to begin in Europe in 2026 and 2027. The news sent LGES shares tumbling nearly 9% on December 18 and down almost 15% for the week. Analysts told Reuters that the abrupt cancellation would be hard to offset in the short term, leaving LGES’s European plants facing delayed utilization improvements.
Nor was LGES alone in feeling the pain. Just a week earlier, SK On—another major Korean battery maker—announced it was ending its joint venture with Ford for battery factories in the US. The two companies had invested $11.4 billion in 2022 to build these plants, but shifting priorities and uncertain demand led to the partnership’s dissolution. SK Innovation, SK On’s parent company, saw its shares fall more than 5% on December 18 and nearly 8% for the week, mirroring the broader malaise across the sector. Samsung SDI, another key player, experienced a drop of over 6% in its share price on the same day and nearly 11% for the week. Battery materials manufacturers like L&F Co, Lotte Energy Materials, and Ecopro BM also suffered double-digit declines.
What’s behind this sudden reversal of fortune? According to Bloomberg and Reuters, the global momentum behind EVs has softened. Governments have rolled back incentives, consumers are balking at high sticker prices and unreliable charging infrastructure, and policymakers—especially in the US and Europe—are rethinking their timelines for phasing out internal combustion engines. In the US, President Donald Trump’s administration has dismantled many of the fuel-efficiency standards and subsidies put in place by his predecessor, slowing the pace of EV adoption. Meanwhile, in Europe, the European Commission’s much-heralded 2035 deadline for ending sales of new combustion-engine cars is now up for debate. Automakers such as Mercedes-Benz, Porsche, and Volkswagen have scaled back their EV investments and lobbied Brussels to reconsider the ban, warning of potential damage to profits and jobs if consumer demand doesn’t keep pace with regulatory ambitions.
The numbers tell a sobering story. Global EV sales growth slowed to 26% in 2024, down from 34% the previous year, according to BloombergNEF’s Electric Vehicle Outlook. While China continues to dominate—accounting for nearly two-thirds of the 17.6 million EVs sold worldwide in 2024—the US and EU have lost ground. In the US, EV sales increased just 12% in the first three quarters of 2025, with further weakening expected as regulations are relaxed. Without government incentives, EVs remain, on average, 30% more expensive in Europe and 27% pricier in the US compared to their combustion-engine counterparts. Western governments have also erected tariffs and trade barriers to fend off competition from Chinese manufacturers like BYD, which offer cheaper models.
The slowdown has forced automakers to adjust their playbooks. Since 2023, legacy car companies have cut their combined 2030 EV sales targets by more than 5 million units, down to 21.7 million. Even Tesla, once the industry’s bellwether, has stopped emphasizing its ambition of delivering 20 million vehicles annually by 2030 and is set to see deliveries fall for a second consecutive year. The EU has granted automakers an extra two years to meet tougher emissions standards, saving them billions in potential fines. Meanwhile, Europe’s ambitions to build a local battery industry have stumbled, with 11 of 16 planned factories delayed or canceled as of 2024, according to Bloomberg.
For Korean battery firms, the industry’s pivot has necessitated a rapid strategic shift. As The Korea Times reported, companies are now focusing on batteries for energy storage systems (ESS), which are becoming critical to the global data-center build-out. LG Energy Solution is likely to shift production lines in Poland—originally set up for Ford’s EV batteries—to focus on ESS batteries instead. The company has already retooled its Michigan, USA, plant to meet local ESS demand. SK On is steering its US plant production towards ESS batteries as well. Samsung SDI is adapting its US lines for lithium iron phosphate (LFP) batteries for ESS projects, with plans to supply batteries worth $1.35 billion. This pivot, while necessary, underscores the uncertainty facing the sector as the EV market’s future becomes increasingly cloudy.
Meanwhile, the broader political and economic context remains fraught. EVs are central to global climate strategies, but the transition has proven more complicated than many anticipated. Electric cars require fewer parts than traditional vehicles, making them cheaper to assemble but also less labor-intensive—a reality that has governments worried about job losses and the political fallout of a rapid transition. At the same time, a slower shift delays emissions reductions and prolongs urban air pollution, while also postponing the point at which Western EV manufacturing can compete with China’s scale and cost advantages. Opening markets to cheaper Chinese EVs, however, would undermine domestic automakers and deepen China’s dominance of green technologies.
Yet, there are glimmers of hope. BloombergNEF forecasts global EV sales growth of 25% in 2025, with EVs projected to account for 56% of passenger vehicle sales by 2035. In China, an extended vehicle scrappage scheme is expected to keep demand robust. Automakers are also rolling out more affordable models to entice cost-conscious buyers: Renault’s all-electric R5 is priced below €25,000, with a €20,000 Twingo on the way; Stellantis’ Citroën e-C3 starts at €14,990 in France for those eligible for a government social lease; Volkswagen’s upcoming electric ID. Polo is expected to cost less than €25,000. According to the Brussels-based NGO Transport & Environment, up to 2 million all-electric vehicles could be sold in the EU this year under optimistic scenarios, with 1.5 million already sold in the first ten months—giving EVs a 16.4% market share, up from 13.2% a year earlier.
Even as the US and EU lose ground to China in the global EV race, the promise of electrification is still visible in places like Oslo, where the streets during the recent Nobel Peace Prize celebrations were filled with the quiet hum of battery-powered vehicles. The contrast with the current malaise in the US and Europe is stark, but it’s a reminder of what’s possible when policy, industry, and public enthusiasm align. For now, though, the EV revolution is at a crossroads—its future uncertain, but its potential undiminished.
