Ford could produce its own EV battery cells by 2025, executive says

Ford could produce its own EV battery cells by 2025, executive says

People visit the Ford Mustang Mach-E all-electric SUV at the 2019 Los Angeles Auto Show in Los Angeles, the United States, Nov. 22, 2019.

Xinhua via Getty Images

STRAIT – Ford engine is expected to sell enough electric vehicles in North America to produce its own battery cells domestically by 2025, an automaker executive told CNBC.

The timeline is the most detailed Ford has given for EV battery production, which Wall Street is watching closely, and it’s a reversal of the company’s strategy under former CEO Jim Hackett. In-house production of battery cells is expected to be the key for automakers to reduce electric vehicle costs and secure supply for a expected increase in demand this decade.

“We don’t have to evolve today to justify our own dedicated battery factory,” Hau Thai-Tang, Ford’s product platform and operations manager, said in an interview Monday morning. “But by 25, as we introduce the F-150, E-Transit, and another battery-electric vehicle that we’ve announced, we’ll have enough volume in North America to justify our own factory.”

The exact timing of production depends on the electric vehicle market, consumer demand as well as R&D progress, according to Ford spokesperson Jennifer Flake. The company, she said, “may be able” to produce its own EV cells by 2025.

Ford has cautiously added electric vehicles to its lineup, launching its first new all-electric car, the Mustang Mach-E, in the United States at the end of last year. The company plans to follow it up with an all-electric Ford Transit van later this year and an EV version of the Ford F-150 Pickup Truck by mid-2022. The company did not disclose details of another new electric vehicle mentioned by Thai-Tang.

Thai-Tang’s comments come after the company announced Monday morning that it would increase its investment in a Starting the EV battery hoping to start integrating next-generation, so-called solid-state batteries into its electric vehicles by the end of this decade.

Thai-Tang said that a single battery cell installation could produce today’s lithium-ion batteries as well as solid-state batteries. Batteries can be lighter, with greater energy density which provides greater runtime at a lower cost. But they are currently more expensive than lithium-ion batteries and in early development.

Ford announced last week that it plans to invest $ 185 million in a new battery lab to make its own battery cells for electric vehicles, but not full production like Tesla or the like. General Motors announced. Ford is currently purchasing cells from suppliers such as SK Innovation, based in South Korea.

The new lab as well as another $ 100 million battery facility that opened last year in addition to Ford’s plans to put $ 22 billion for vehicle electrification from 2016 to 2025.

Ford’s plan to manufacture battery cells began under the leadership of Ford CEO Jim Farley, who took over the helm of the automaker October 1. It changed the course set by its predecessor, Hackett, who said the automaker saw “no benefit” in producing battery cells.

Electric vehicles only made up about 2% of new vehicle registrations in the United States last year, according to IHS Markit. But the company expects that to drop from 25% to 30% by 2030 and 45% to 50% by 2035, according to IHS Markit.

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