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Ford and Korea’s SK to launch battery joint venture in US

US carmaker to add critical component to its ambitious electric vehicle future, while partner hopes project will help leave behind trade theft case


ford motor
US President Joe Biden road tests the new Ford F-150 Lightning electric truck. Photo: Reuters.

(ATF) Ford Motor Co and South Korea’s SK Innovation are expected to announce a battery joint venture in the United States.

While a memorandum of understanding about the joint venture is due to be announced on Thursday, Reuters reported that the plans include a plant to make battery cells for use in rechargeable electric vehicle (EV) batteries.

For Ford, the deal marks a significant step in its goal of making its entire passenger vehicle line-up in Europe all-electric by 2030. By the middle of 2026, all its cars will be available as electric or hybrid models, it added.

Ford said it would spend $1 billion (£720m) updating its factory in Cologne, with the aim of producing a mass-market EV by 2023.

“Ford is now preparing for a future that is electric-first, leaving behind the traditional combustion engine which made it famous and providing a roadmap to a 100% electric world by the end of the decade,” said Oliver Shaw, chief executive of Kalibrate, a consultancy.

TALKS ADVANCE

Talks around the joint venture picked up speed last month after SK Innovation agreed to pay $1.8 billion to LG Energy Solution, a wholly owned subsidiary of LG Chem to settle LG’s accusations of trade theft by its rival.

The Korean company is expected to complete construction of a plant in the US state of Georgia later this year, and it is building a second facility that is expected to start battery production in 2023. The company has invested $2.6 billion in Georgia.

SK Innovation, with battery production sites in the US, Hungary, China and South Korea, has an annual capacity of about 40 gigawatt-hours (GWh) of batteries. It aims to ramp up to an annual capacity of about 125 GWh of batteries in 2025, which can power about 1.8 million electric vehicles.

A deal with SK may have Ford taking a similar path as rival General Motors, which has a battery joint venture with LG Energy that is building plants in Ohio and Tennessee.

With reporting by Agence France-Presse

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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.