According to a new report in the Wall Street Journal, Ford is in $F (-1,34 %) is in negotiations with BYD $1211 (-1,08 %) to purchase batteries for some of its hybrid models.
Sources familiar with the matter said talks on the exact terms of the battery deal are still ongoing, but some indicated that Ford would use the batteries for hybrid vehicles sold outside the U.S.
Under the agreement, Ford would import BYD batteries to plants outside the U.S., possibly to Germany, Spain, Thailand, Turkey or other large overseas plants. However, according to the sources, there is still a possibility that the deal will not materialize.
A Ford spokesperson said, "We are talking to many companies about many things," but did not provide further details. BYD declined to comment.
The report follows Ford's announcement last month that it would discontinue the all-electric F-150 Lightning as part of a broader transition of its Ford+ plan.
Instead of large electric vehicles, Ford is focusing more on smaller, more affordable models with its low-cost universal EV platform. In the meantime, the company will fill the gap with new hybrid vehicles and extended-range electric vehicles (EREVs).
Ford will replace the electric pickup with an EREV version that uses both battery power and a gasoline engine that acts as a generator to keep the battery charged.
The company announced that it would incur losses of 19.5 billion US dollars as a result of the restructuring, about half of which was due to the discontinuation of the Lightning model.
Ford is nearing completion of its BlueOval Battery Park in Michigan, where it will license technology from Chinese company CATL for upcoming vehicles based on the UEV platform. The battery factory is scheduled to start production this year.
The first vehicle based on the UEV platform will be a mid-size electric pickup, which Ford says will start at around 30,000 US dollars.
At the Detroit Auto Show, which opened to the public on Thursday, Ford CEO Jim Farley said that following the success of the F-150 Hybrid, he wants to expand the company's hybrid and EREV lineup.
Electrek's opinion
It's no great surprise that Ford is turning to China's leading battery manufacturers. The company has already licensed CATL's technology for use in its Michigan battery plant, so a deal with BYD is a distinct possibility.
For Ford, this would help ensure a stable supply of batteries (outside the US) as the company plans to launch new hybrid and EREV models over the next few years.
Ford and BYD are no strangers to each other either. In 2020, Ford's joint venture in China, Changan Ford, began using BYD batteries in vehicles sold there. Since then, BYD has reportedly contacted Ford about supplying batteries for other markets.
While the US is pulling back, China is pushing new EV technologies, including next-generation batteries, advanced driver assistance systems (ADAS) and other related technologies.
China already dominates the global EV battery market. According to SNE Research, CATL and BYD alone accounted for over 50% of global sales last year.