Ford and BYD are negotiating battery purchases, with plans including "shipping to factories outside the United States."

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Ford Motor is engaged in in-depth negotiations with BYD to establish a partnership. According to the plan, the American automaker will purchase batteries from the Chinese automotive giant for use in some of its hybrid models.

On January 15, according to The Wall Street Journal, sources revealed that both parties are still discussing the specific cooperation model. One current plan is for Ford to transport batteries purchased from BYD to its factories outside the U.S. for production. Negotiations are ongoing, and there are still uncertainties as to whether a final deal will be reached.

If the agreement is reached, Ford will join hands with the largest Chinese automotive company, which possesses cutting-edge technology and a cost advantage. As Ford reduces its pure electric vehicle business and increases investment in hybrid models, the company is in urgent need of high-quality battery suppliers, and BYD has mature manufacturing capabilities in this field.

The report points out that last month Ford announced a strategic shift from pure electric vehicles to hybrid models, with a goal for hybrids, plug-in hybrids, and pure electric models to account for about half its global sales by 2030.

BYD Continues Expanding Battery Production Capacity

Before becoming one of the world's largest automakers, BYD had already established a strong battery manufacturing business, including batteries for hybrid vehicles.

The company mainly produces batteries in China but is expanding capacity at overseas factories, targeting markets such as Southeast Asia, Europe, and Brazil. According to Bernstein Research estimates, BYD’s battery shipments grew by 47% last year, reaching 286 GWh.

BYD has previously produced commercial vehicle batteries at its California bus manufacturing plant, but has not yet produced passenger vehicle batteries in the U.S.

Ford Accelerates Hybrid Layout

Ford is facing the challenge of slowing electric vehicle demand. Last month, the company said it would adjust its strategy and is expected to bear $19.5 billion in costs, mainly associated with its electric vehicle operations.

At the same time, Ford plans to expand its lineup of fuel vehicles and offer more hybrid models, which requires more batteries suitable for hybrids.

Ford's hybrid vehicle sales have already shown growth momentum. In the fourth quarter of last year, the company’s hybrid vehicle sales increased by 18% year-on-year to about 55,000 units.

At this week's Detroit Auto Show, Ford CEO Jim Farley said the company had succeeded with the F-150 hybrid version and now wants to expand to other hybrid and range-extender models.

The Two Sides Already Have a Cooperation Foundation

This is not the first time Ford and BYD have cooperated.

In 2020, Ford started using BYD batteries in China for vehicles produced by its joint venture with state-owned automaker Changan. A few years later, BYD proposed supplying batteries for Ford vehicles sold in other markets.

It is worth noting that several American automakers have established partnerships with foreign battery manufacturers. General Motors and Ford previously set up joint ventures with Korean companies.

Ford is building a battery plant in Marshall, Michigan, planning to use technology from Chinese battery maker CATL to produce low-cost batteries. The plant is expected to begin operating this year, producing batteries for Ford’s upcoming $30,000 pure electric pickup truck.

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