An important decision in the electric vehicle industry: U.S. automaker Ford Motor Co. announced plans to begin in-house production of lithium-ion batteries for its electric vehicles. The move is intended to improve the company’s cost efficiency and long-term sustainability.
New Battery Development Center
Ford intends to invest $185 million to establish a battery development center in southeast Michigan. According to the company’s chief engineer, Hau Tai-Tang, this center will be the starting point for the production of batteries for electric vehicles in the future.
Potential Economic Benefit
Batteries are the most costly component of electric vehicles today, accounting for at least a quarter of the total cost. Opening their own production facility could allow Ford to reduce battery costs, which would ultimately affect the cost and availability of their electric models.
Steps to Independence
Ford currently purchases batteries from third-party suppliers. This new move will allow the company to increase its independence from outside supplies by providing more reliable and flexible sources of supply.
Power Stack: The F-150 Case Study
Ford’s plans are already taking shape. Electric versions of the popular F-150 pickup expected on the market next year will use batteries developed by Korea’s SK Innovation Co.
Toward Growth and Sustainability
Ford’s decision to start its own battery production for electric vehicles is a step toward greater independence, cost efficiency and innovation. It also underscores the automaker’s persistent adaptation to the new realities of electrification and the growing demand for clean transportation.