Ford is dropping the once-heralded all-electric version of its F-150 Lighting pickup, shifting more of its money into hybrid trucks and energy storage technology.

• 💵 Why it matters: The company's pivot to match customer demand will come with almost $20 billion in charges to be taken now through 2027, more than $5 billion of that in cash over the next two years.

⚡️ The big picture: The automaker painted this afternoon's announcement as a response to clear signals from customers about what they want, and don't want:

• 👍 Yes, to more affordable vehicles.
• 👎 No, to EVs that sacrifice performance and utility.

Zoom in: Ford said it will redeploy its capital to diversify powertrain options in market segments where it does well, such as work trucks and vans.

• For example, instead of selling a fully electric pickup, Ford said the next F-150 Lightning will be an extended-range EV, pairing an electric motor with a gasoline engine for 700 miles of driving range.
• Ford is sticking to its plan to build a new line of affordable EVs, starting with a mid-sized electric pickup due in 2027.

Zoom out: By 2030, about 50% of Ford's global volume will be hybrids, extended-range EVs and electric vehicles, versus 17% today, the company said.

• 🔋 The company is also starting a new business to sell battery storage systems to utilities and data centers for backup power, something GM also recently announced.

What to watch: Ford said the changes will enable its EV business to be profitable by 2029 and raised its year-end profit outlook to $7 billion.

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McKinsey & Co. has reportedly given itself some tough advice: slim down.

• The consulting giant is discussing plans to cut roughly 10% of its support-staff headcount over the next 18–24 months, Bloomberg reported.

Zoom out: McKinsey has grown rapidly over the past decade — more than doubling its workforce since 2012 to over 40,000 employees today.

• But revenue hasn't kept pace, stuck in a range around $15 billion–$16 billion over the past five years, per Bloomberg.

📊 Between the lines: The firm's plan appears to be, at least in part, a realignment of resources.

• The firm still reportedly plans to add consultants, while a spokesperson tells Bloomberg that McKinsey is working to "improve the effectiveness and efficiency of our support functions" amid rapid advances in AI.

🤖 Toymaker Mattel won't unveil its first product with OpenAI this year as originally hoped. Much has changed since the tie-up was announced in June, including an increased focus on the interactions between AI and young people. (Axios)

🏛️ The White House unveiled a new AI-focused "Tech Force," looking to tap employees from the nation's biggest tech firms in the latest sign of the industry's embrace of President Trump. (Axios)

Mergers are often ways for companies to cut jobs and raise prices — but they can also serve as lifelines. And when lifelines disappear, things can quickly unravel.

• Roomba maker iRobot filed for Chapter 11 bankruptcy protection today, with plans to hand ownership to its lender and contract manufacturer while continuing operations.
• Spirit Airlines announced a deal with creditors to tap an additional $100 million under its bankruptcy financing. The airline insists it will keep flying even as competitors openly question its ability to last.

🫨 The big picture: The two bankruptcies show how quickly life can become precarious for companies whose merger plans were rejected.

• Amazon canceled its $1.4 billion acquisition of Roomba maker iRobot in January 2024 after European Union antitrust regulators signaled opposition to the deal.
• Spirit had arranged a $3.8 billion sale to JetBlue in 2022, but a federal judge blocked that deal in 2024 at the urging of the Biden administration.

⚖️ In both cases, regulators raised concerns about the impact on consumers and the market from reduced competition.

✈️ What we're watching: Trade pub The Air Current reported today that at least two airlines were preparing for the possibility of the company's imminent collapse.

• 🗣️ Spirit quickly denied that report: "There is no truth to any rumors that we are preparing to cease operations. It is business as usual at Spirit and flights continue to operate normally."