Ford Invests $185 Million in Battery Research and Development

Ford Motor Company is initiating a significant investment in battery technology with the establishment of a new $185 million research and development laboratory. This facility will focus on the development and production of both battery cells and complete battery packs. It represents an initial stride towards the potential for Ford to internally manufacture its own battery cells.

A Clear Commitment to Electric Vehicles

This new investment serves as a definitive indication to consumers and competing automakers that Ford is fully committed to the transition towards battery electric vehicles (BEVs). The company is moving beyond a cautious approach and embracing a future powered by electric technology.

Facility Details and Location

The Ford Ion Park, as the facility will be known, will be located in southeastern Michigan. It is projected to employ over 150 individuals specializing in battery technology development, research, and manufacturing processes.

The facility is anticipated to encompass approximately 200,000 square feet and is scheduled to become operational by the close of 2022. It will work in conjunction with Ford’s existing battery testing laboratories in Allen Park, Michigan, which are currently engaged in evaluating battery cell designs and chemical compositions.

Leadership and Research Focus

Anand Sankaran, currently Ford’s director of electrified systems engineering, will lead the new facility. He characterizes it as a “learning lab” dedicated to the creation of both small-scale and pilot-scale cell assembly lines.

Research will encompass next-generation lithium-ion batteries, as well as the exploration of solid-state battery technology.

Phased Approach to Battery Production

Hau Thai-Tang, Ford’s chief product platform and operations officer, outlined a phased strategy for the company’s transition to BEVs. The initial phase focuses on serving early adopters through partnerships with external suppliers.

As BEV market share expands, Ford is preparing for a second phase. This will involve bringing more electric products to market and necessitates greater control over the battery supply chain.

Vertical Integration and Cost Considerations

Ford aims to achieve greater flexibility and the option to vertically integrate battery production. This strategic move is intended to enhance supply chain control and deliver batteries with improved range, reduced costs, and higher quality.

Progress in battery energy density and cost reduction are critical to Ford’s leadership in the electric revolution, according to Thai-Tang.

Domestic Battery Cell Manufacturing

The development of domestic battery cell manufacturing is currently dominated by Asian companies, including Panasonic (a key supplier to Tesla), LG Chem, and SK Innovation (Ford’s current supplier). This new facility could significantly bolster domestic production.

Recent global events, such as the pandemic and semiconductor shortages, have underscored the importance of a localized and secure supply chain.

Capital Investment and Scale

Establishing a battery manufacturing presence requires substantial capital investment in both research and development, as well as the construction of production facilities. Ford is evaluating the necessary scale and volume to justify dedicated battery production sites.

The company’s optimistic outlook on the growth of the EV market suggests that the time is approaching when greater vertical integration becomes feasible.