Ford Motor Company has cancelled a $6.5 billion electric vehicle battery contract with South Korea’s LG Energy Solution, just over a year after signing it in October 2024. The deal had covered battery supplies for Ford EVs from 2026 onward.
LG Energy Solution said the cancellation followed Ford’s decision to halt production of certain EV models. Ford cited shifts in government policies and lower-than-expected EV demand as reasons for ending the agreement.
The batteries were to be manufactured at LG’s plant in Poland for use in several Ford electric vehicles, including commercial vans.
Following the news, LG Energy Solution’s shares fell more than 7 percent on the Seoul stock market. Analysts warn that losing this contract may make it difficult for LG to fully utilize its European factory capacity when production was supposed to ramp up in 2027.
Industry observers note that the move reflects a broader reassessment by Ford of its EV strategy, including scaling back some fully electric models in response to slower sales and changing market conditions.
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