Ford Enters the Battery Storage Market with a New Business
However, the automaker’s shift away from large electric vehicles has led to a new opportunity – a battery storage business.
According to Ford, the company will use its existing manufacturing capacity to produce cheaper lithium iron phosphate batteries, which will be used to power data centers and help buffer demand on the electric grid.
Meanwhile, the battery storage systems will start shipping in 2027, with Ford planning to build 20GWh of annual capacity.
Investment and Expansion
Consequently, Ford will invest about $2 billion into the new business over the next two years.
Under the plan, Ford will repurpose the existing manufacturing capacity at its Kentucky factory, producing LFP batteries using technology licensed from China’s CATL.
In addition, the company will also produce battery energy storage system modules and 20-foot DC container systems at this facility.
Competition and Opportunities
Moreover, Ford will join a number of automakers that are operating in or planning to enter the battery storage space, including Tesla and General Motors.
According to Lisa Drake, vice president of technology platform programs and EV systems at Ford, the “predominant” opportunity for the new business will be commercial grid customers.
However, data centers will be secondary, and then Ford expects to offer some home storage products.
Production and Expansion
Therefore, Ford’s BlueOval Battery Park Michigan in Marshall, which is slated to begin production of LFP batteries in 2026, is still on track.
Those LFP batteries, which also use CATL tech, will be used in Ford’s upcoming mid-sized electric truck.
Meanwhile, there will be one adjustment at the Michigan factory, as Ford will also be used to make smaller Amp-hour cells for use in “residential energy storage solutions.”
However, the BlueOval Battery Park Michigan has gone through several iterations in its abbreviated life, with Ford initially investing $3.5 billion to build the factory to make LFP batteries for its growing portfolio of electric vehicles.
However, Ford abruptly halted construction on the factory in September 2023, before announcing a dialed-back plan with a production capacity of 20 gigawatt-hours, about 43% smaller than planned.
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