South Korea’s LG Energy Solution (LGES) said on Wednesday that Ford Motor has terminated an electric vehicle battery supply agreement valued at about $6.5 billion, citing changes in policy and a weaker outlook for EV demand.
LGES said in a regulatory filing that the cancellation followed formal notice from Ford after the U.S. automaker decided to halt production of some electric vehicle models. The decision reflects broader adjustments by Ford in response to policy changes under the Trump administration and slower-than-expected growth in EV adoption.
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The battery maker said it had signed two contracts in October last year to supply EV batteries to Ford’s operations in Europe, with deliveries scheduled to begin in 2026 and 2027.
Ford earlier this week said it would take a $19.5 billion writedown and cancel several electric vehicle programmes, marking one of the most significant retrenchments by a major automaker from battery-powered models. The company has said it plans to scale back investment in fully electric vehicles and instead prioritise hybrids and extended-range electric vehicles (EREVs).
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The shift has had ripple effects across Ford’s battery supply chain. Last week, South Korean battery maker SK On said it had decided to end its joint venture with Ford that was developing battery factories in the United States.
Ford has said the strategic reset will involve cancelling multiple planned battery-electric models and reassigning production at several plants, a move it expects to cost about $19.5 billion. At the same time, the automaker is seeking alternative uses for battery capacity, including entering the battery energy storage system (BESS) market.
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The company has said it plans to invest around $2 billion over the next two years to convert its battery manufacturing site in Glendale, Kentucky, into a hub for large-scale energy storage systems to serve data centres, utilities and grid operators.
Ford is also preparing a next-generation F-150 Lightning featuring an EREV powertrain, aiming to maintain the pickup’s role in supporting its U.S. electrified vehicle sales as it recalibrates its long-term EV strategy.
