Ford, LG Energy Solution EV battery plant agreement scrapped: Economic concerns blamed

In February, LG Energy Solution entered into a preliminary agreement with Ford and Turkey’s Koc Holding to collaborate on establishing a joint venture for manufacturing electric vehicle (EV) batteries in Baskent, near Ankara, the capital of Turkey. However, Koc Holdinglater decided to withdraw from the agreement, citing considerations regarding the adoption of EVs and the perceived inopportune timing for battery investments, as reported by IANS, citing the Yonhap news agency.This decision was influenced by a growing concern about potential declines in EV demand due to economic challenges and increasing costs.

Despite Koc Holding’s withdrawal, LG Energy Solution reaffirmed its commitment to the project, disclosing plans for the factory to initially achieve a production capacity of 25 gigawatt hours (GWh) by 2026, with subsequent expansion to 45 GWh annually. The manufactured batteries were intended for supply to Ford, specifically for use in their electric Transit vans designed for commercial purposes.
It’s noteworthy that Ford and Koc Holding already have a joint venture in Turkey, producing 450,000 commercial vehicles each year, predominantly sold in the European market.
LG Energy Solution assured that the termination of the Turkish EV battery project would not impact its battery supply to Ford. As the world’s second-largest battery manufacturer, LG Energy Solution boasts a global production capacity of 200 GWh annually, operating in six countries. As of the end of 2022, the company had an order backlog amounting to 385 trillion won ($294.8 billion).