Ford establishes division for large batteries
Ford is exiting the business of large e-cars. In return, it is entering the business of large batteries for data centers and power grids. Entirely on its own.
Grid-supporting batteries can bridge short fluctuations in the power grid. This makes them valuable.
(Image: Andreas Wilkens / heise medien)
Because Ford is abandoning large electric vehicles, a new purpose must be found for its battery factories. The automotive group therefore plans to enter a new business area: large accumulators for data centers and power grids. The project also includes the establishment of a new sales and maintenance structure. However, the launch is marked by a wave of layoffs.
For the next two years, Ford plans to invest approximately two billion US dollars in the new corporate division. An existing factory in Kentucky is to supply lithium iron phosphate (LFP) cells in prismatic format, also package them into storage modules, and even fit them into finished 20-foot shipping containers. The power storage systems are intended to deliver more than five megawatt hours.
The first expansion phase is scheduled to be completed in eighteen months. By the end of 2027, Ford aims to have sold large batteries with a total capacity of at least 20 gigawatt hours.
Joint venture with SK terminated, 1,600 layoffs
Originally, Ford planned three huge battery factories in the USA together with the South Korean group SK: one in Tennessee, two in Kentucky. This joint venture is being dissolved, meaning Ford will enter the market for large power storage systems alone.
So far, only one factory in Kentucky has been completed. It has previously built batteries for Ford's all-electric pickup F150 Lightning but was not utilized due to sluggish demand. Since this vehicle is no longer being built, the facility has little to do. The second factory planned in Kentucky was not built due to lack of demand; the one in Tennessee is still under construction and is scheduled to start production in 2027.
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As part of the separation, SK will take over the construction project in Tennessee, while Ford will receive the factory in Kentucky. Around 1,600 people are employed there, who will now become unemployed. After conversion into a manufacturing facility for grid-supporting power storage, Ford intends to offer around 2,100 new jobs.
Home batteries from Michigan
However, Ford still needs accumulators for vehicles, albeit fewer than previously planned. For a planned, all-electric midsize pickup, Ford will use a facility in Michigan that is scheduled to start producing LFP cells next year. This factory will also deliver power storage systems for private households. Ford thus also intends to compete with Tesla in this area.
Because iron and phosphate are cheaper than nickel, manganese, and cobalt, LFP batteries are more cost-effective than NMC batteries. LFP cells are robust and have a low risk of thermal runaway. However, their energy density is lower than that of NMC. Especially for stationary use, high-energy density is rarely so important that it would justify the higher NMC price.
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