Ford scales back EV plans, pivots to energy storage with Chinese battery tech

On the Dash:

• Ford shifts focus from EVs to energy storage by leveraging CATL’s LFP technology, converting its Kentucky plant to produce stationary storage batteries.
• Chinese tech partnership navigates U.S. policy and subsidies, allowing Ford to claim federal tax credits while accelerating domestic battery production.
• Long-term goal remains domestic innovation, with Ford aiming to develop its own low-cost batteries while addressing growing energy storage demand in the U.S.

Ford is scaling back its EV plans while launching a major new initiative to produce batteries for energy storage. According to the automaker, it will leverage Chinese lithium iron phosphate (LFP) technology licensed from Contemporary Amperex Technology (CATL) to manufacture stationary storage batteries at its Kentucky facility.

The pivot marks a strategic shift for Ford, which first partnered with CATL in 2023 to produce LFP batteries for EVs. With the new focus on stationary storage, the company plans to capitalize on growing U.S. electricity demand, projected to rise 12% by 2030, and take advantage of federal tax incentives tied to battery production.

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Lisa Drake, Ford’s vice president of technology platform programs and EV systems, noted that the move was a “natural adjacency,” combining the company’s century-long manufacturing expertise with an existing license to produce the technology in the U.S.

The decision also highlights the complex interplay between U.S. industrial policy and foreign technology. Ford’s Kentucky plant conversion comes amid political and regulatory scrutiny of Chinese battery firms operating in the U.S., including halted projects in Michigan and Kentucky by other Chinese-owned companies.

Despite potential hurdles, Ford executives have indicated that market demand for energy storage is strong. The company consulted potential customers prior to committing to production, and feedback confirmed a sizable opportunity for batteries in residential, commercial, and industrial applications.

Notably, the Kentucky BlueOval SK facility is expected to open next year. The company views the partnership with CATL as a stepping stone toward developing its own low-cost batteries. 

Ford’s expansion into energy storage demonstrates how the company plans to balance U.S. manufacturing, federal incentives, and licensed foreign technology to compete in the growing clean energy sector.