In March of 2022, Ford Motor Company and SK On signed a memorandum of understanding to work together in a battery cell venture. The plan was to build a plant in Turkey that would have an annual production capacity of up to 30 to 45 GWh. But, according to both sides, this deal appears to be canceled. So, what’s next for Ford and its electric battery production?
Ford’s Plan for Battery Production
Ford initially partnered with SK On in order to supply their commercial vehicles with batteries. The automaker plans to produce a high volume of commercial cars and trucks at its plant in Turkey, so it makes perfect sense to have the batteries produced there as well.
Why Did the Venture Fall Apart?
Just a few months after signing the memorandum, we are learning that SK plans to retract the joint venture because of a weak EV outlook in Europe. The rising global interest rates are another factor contributing to the cancellation of the plan for the two companies to work together in Turkey.
Ford and SK On Still Going Strong in the US
The joint venture between SK On and Ford is going strong in the United States. They’ve already broken ground on a $5.8 billion electric battery campus in Harden County, Kentucky, which they call the BlueOval SK Battery Park. This plant is on track to begin production in 2025. Ford and SK On are also building two factories in Glendale, where they will produce lithium-ion batteries. The plan for these factories is to make enough batteries to power over a million electric vehicles by 2026, just a year after they begin production.
Who Does Ford Plan to Partner with Now?
Ford is not stopping their plans for an electric battery plant in Turkey, even though the joint venture with SK On is not looking good. It’s now looking like they will partner with LG Energy Solution instead as they look to diversify their suppliers and speed up the shift to clean energy vehicles.
According to some sources, Ford and LG Energy Solution will most likely sign a memorandum of understanding sometime in the early part of 2023. The partnership with LG will not change the goal of a facility with an annual capacity of 30 to 45 GWh.
Ford’s Vision of Local Battery Plants
CEO Jim Farley recently committed $50 billion to the development and manufacturing of Ford electric vehicles. This means they need to accelerate their plans for EV batteries. There are plans for an all-new plant in Tennessee and the possibility of a factory in Germany. SK currently produces the batteries for the F-150 Lightning pickup truck, and LG produces the batteries for the Mustang Mach-E.
Ford has a lot in the works for its electric vehicle and electric battery production going forward. They are committed to cleaner driving cars, and the new factories in the United States and in Europe are just the start.
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