Ford announced in mid-2021 that CATL will provide lithium iron phosphate batteries for its four pure electric products. However, according to recent news from Reuters, the commercial environment has been affected by US-China trade relations and the Inflation Reduction Act (IRA) recently passed, and CATL and Ford are weighing the pros and cons of their cooperation.
At present, it seems that CATL will not only import batteries from China to North America, but will also establish factories in North America. According to Bloomberg’s report, CATL is considering selecting sites in Mexico, the United States, and Canada to establish battery factories, with Michigan and Virginia states being the most likely.
The initial intention of Ford’s cooperation with CATL was to expand the profitability of pure electric vehicles and reduce the cost of battery production. Under the US IRA, only battery factories located within the US can be exempt from taxes, with an amount of about $35/kWh. In addition, according to the latest requirements, raw materials for battery production must also be purchased locally.
Therefore, there are rumors that CATL and Ford may adopt a new model of cooperation. The battery factory will be 100% owned by Ford, including infrastructure. However, the operation and technology holdings of the factory will be taken over by CATL. However, no official comments have been made on this, and CATL only stated in the declaration that this is based on commercial considerations. Ford CEO Jim Farley mentioned in the Q3 earnings report earlier this year that Ford will import lithium iron phosphate batteries from China “more economically.” It also implies the possibility of having localized production.
Currently, Ford’s three pure electric products, Mach-E, E-Transit, and F-150 Lightning, all use ternary lithium batteries provided by SK Innovation and LG Energy Solution. In the future, 2023 Ford Mustang Mach-E and 2024 Ford F-150 Lightning will be the first to be equipped with lithium iron phosphate batteries in the North American market.
It is expected that the demand for lithium iron phosphate batteries in North American factories will reach 40 GWh/year from 2026 onwards. Therefore, there is still some time for Ningde Times and Ford to further promote their cooperation.
🔗Source: insideevs
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.