Ford is promising more affordable electric vehicles, but it’s still looking to make a profit with EVs. After kicking off production at its new EV battery plant in Kentucky, Ford seems to be looking for customers other than itself and selling batteries to whoever wants them.
According to a new report from Bloomberg, Ford’s battery joint venture, BlueOval SK (a tie-up between Ford and SK On), is considering turning its sprawling battery investments into a standalone revenue stream.
That means taking the excess capacity produced in its factories and selling it off to other automakers, grid storage providers, and anybody with a big enough checkbook. Ford is becoming America’s hookup for domestically produced batteries.
Huge investments
Ford has invested billions into its joint venture with SK On. The pair has since broken ground on plants in Tennessee and Kentucky, in part thanks to a $9.2 billion loan from the US government. But it turns out that the planned capacity of these plants will result in more batteries than Ford can use.
“We’re in a monitoring phase and just being conservative in what we do to make sure that we’re safe. I think the market continues to grow, but it will be at a slower pace,” Adams said.
EV market grows more slowly than expected
Ford’s excess capacity isn’t necessarily due to poor planning. It’s because the EV industry has grown at a slower rate than most in the industry expected.
With the $7,500 US federal tax credit set to expire and tariffs taking effect, EV sales are expected to decline starting in the third quarter of this year in the US. This means that a significant number of batteries that Ford can’t use at the time will be available.
Adams says that he believes the likelihood of new customers signing up for battery capacity is “fairly high.” Considering that automakers will soon face hefty import tariffs for vehicles and parts brought into the US from abroad, by manufacturing domestically, Ford could help its brands avoid this unexpected cost while still increasing its profits.
The brand is also setting its sights on something easier to manage: energy storage. That’s a source of significant growth for Tesla, by the way, and they’re happy to have it now that their car sales are falling behind. As the world electrifies everywhere, it will need a large number of batteries, and someone has to build them. Might as well be Ford, they say in Dearborn.
Adapt the strategy
Ford has overhauled its EV strategy with plans to launch smaller, more affordable electric cars. The company is betting on its new Ford ‘Universal EV Platform’ to unlock more affordable electric vehicles while still making a profit. At the same time, it has implemented a new production system aimed at significantly reducing costs.
The first vehicle based on the platform is expected to be a mid-size electric pickup with a starting price around $30,000. Customer deliveries are set to begin in 2027. Ford will utilize lower-cost lithium-iron-phosphate (LFP) batteries, manufactured in Michigan with licensed technology from China’s CATL, to power the new platform.
Like most automakers these days, Ford is aggressively looking to cut costs to turn a profit on electric vehicles. Following its EV business, named Model e, losing $5.1 billion last year, Ford is warning that it could lose even more this year due to investments in its next-generation models.
According to Ford CEO Jim Farley, the first model will need to be profitable in its first year on the market. Selling extra batteries could be a new source of revenue for Ford as it looks to turn things around.
Ford isn’t the first automaker to want to sell EV batteries in the US, and it won’t be the last. Earlier this year, a Nikkei report claimed Toyota would begin selling batteries to power Honda’s hybrid vehicles from its new plant in North Carolina, starting in 2026.
And remember, Tesla boss Elon Musk has always said that his first business and interest was not selling cars but selling batteries so that others could put them in their vehicles. The sales of batteries are still an essential source of income for this manufacturer.
