Ford Motor Co. is reshaping its electric vehicle and battery strategy, scaling back plans for some large electric vehicles while repositioning its Kentucky battery operations to serve the growing energy storage market.
The company said it will no longer move forward with manufacturing certain larger EVs, citing weaker-than-expected demand, high costs and regulatory changes. As part of the shift, Ford plans to repurpose its battery manufacturing facility in Glendale, Kentucky, to produce battery energy storage systems for data centers, utilities and large industrial customers.
“This is a customer-driven shift to create a stronger, more resilient and more profitable Ford,” President and CEO Jim Farley said in a statement. “The operating reality has changed, and we are redeploying capital into higher-return growth opportunities.”
Ford also announced that it recently reached an agreement with partners SK On and SK Battery America to restructure ownership of its battery plants. Under the agreement, a Ford subsidiary will independently own and operate the Kentucky battery plants, while SK On will fully own and operate the Tennessee facility.
The move is expected to result in significant job losses at the Glendale site. According to published reports, all 1,600 current employees are slated to be laid off as production plans for electric vehicles are revised.
Ford said it will invest about $2 billion over the next two years to build out the new energy storage business using existing U.S. battery manufacturing capacity. The Glendale facility will be converted to manufacture large-scale battery energy storage systems, including lithium iron phosphate prismatic cells, battery modules and containerized systems rated at 5 megawatt-hours or more. Ford expects initial production to begin within 18 months and plans to reach at least 20 gigawatt-hours of annual deployment by late 2027.
Separately, Ford said its BlueOval Battery Park Michigan facility in Marshall, Michigan, remains on track to begin producing lithium iron phosphate battery cells in 2026. Those cells are slated for use in residential energy storage systems as well as Ford’s upcoming midsize electric truck, the first vehicle planned for the company’s new Universal EV platform.