Ford Motor Company is in negotiations with Chinese automotive giant BYD to establish a partnership that would see the American automaker sourcing batteries for some of its hybrid vehicle models, according to various sources.
The Wall Street Journal reported on January 15 that the companies are still determining the specifics of the potential collaboration. One option under consideration involves Ford shipping BYD-supplied batteries to its manufacturing facilities outside the United States. The negotiations remain ongoing, and the deal has not yet been finalized.
If an agreement is reached, Ford would gain access to battery technology from China’s largest automaker, known for its cost advantages and manufacturing capabilities. The potential partnership aligns with Ford’s recently announced strategic pivot to scale back pure electric vehicle operations while increasing investment in hybrid models.
Last month, Ford declared its intention to shift focus from all-electric vehicles toward hybrid powertrains, with a target of having hybrid, plug-in hybrid, and electric vehicles account for approximately half of its global sales by 2030.
Before becoming one of the world’s largest automakers, BYD established a robust battery manufacturing business that includes batteries for hybrid vehicles.
The company primarily produces batteries in China but is expanding capacity in overseas facilities to grow in markets across Southeast Asia, Europe, and Brazil. Bernstein Research estimates BYD’s battery shipments increased 47% last year, reaching 286 gigawatt-hours.
While BYD has previously produced commercial vehicle batteries at its California bus manufacturing plant, it has yet to manufacture passenger vehicle batteries in the United States.
Ford is currently navigating challenges from slowing electric vehicle demand. Last month, the company announced it would adjust its strategy and expects to incur 19.5 billion USD in costs, primarily related to its electric vehicle operations.
Simultaneously, Ford plans to expand its gasoline vehicle lineup and increase hybrid model options, requiring more batteries suitable for hybrid vehicles. The company’s hybrid vehicle sales have already shown growth momentum, with fourth-quarter sales last year increasing 18% year-over-year to approximately 55,000 units.
The potential deal would build upon existing ties between the companies. In 2020, Ford began using BYD batteries in vehicles produced by its Chinese joint venture with state-owned automaker Changan. Years later, BYD approached Ford about supplying batteries for vehicles sold in other markets, with the recently launched Ford Bronco PHEV utilizing batteries from BYD subsidiary Findreams.
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