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Ford (F) to Invest $3.5 Billion to Build LFP Battery Plant
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Ford (F - Free Report) announced a massive investment of $3.5 billion in a lithium iron phosphate battery (LFP) plant, which will add nearly 35 gigawatt hours/year of new battery capacity for the auto giant in the United States. With this capacity, Ford can power as many as 400,000 future EVs. LFP batteries are more durable and use low-demand and more cost-effective materials. These batteries will power a range of next-generation, affordable electric passenger vehicles and trucks. The inclusion of these low-cost batteries in its EV lineup will help Ford gain scalability and make EVs accessible and affordable for customers.
With this new battery chemistry, in addition to the existing nickel-cobalt-manganese (NCM) battery, customers will get a chance to choose an EV with a range of different battery performances more specific to their needs. This advancement will pave the way for Ford’s target to boost its EV production, offer more choices to potential customers and help the company achieve an 8% EBIT margin by 2026.
Under the Ford+ plan, the company targets delivering 600,000 electric vehicles by the end of 2023 and 2 million by the end of 2026. With this $3.5 billion investment, Ford and its battery collaborators have, so far, invested $17.6 billion in EV and battery production in the United States to progress towards the company’s commitment of investing $50 billion in EVs till 2026.
Ford is the first automaker that has pledged to set up both NCM and LFP battery production plants in the United States. Jim Farley, president, and CEO of Ford said, “We’re delivering on our commitments as we scale LFP and NCM batteries, and thousands and soon millions, of customers, will begin to reap the benefits of Ford EVs with cutting-edge, durable battery technologies that are growing more affordable over time.”
Ford aims to increase production capacity and reduce wait times for customers. For that, it plans to introduce LFP batteries on the Mustang Mach-E model this year and the F-150 Lightning model next year, well ahead of the opening of a new battery plant. LFP battery technology helped Ford look beyond critical minerals used in traditional batteries and create a healthy and sustainable EV supply chain within the country.
Zacks Rank & Key Picks
F currently carries a Zacks Rank #3 (Hold).
A few top-ranked players in the auto space include Mercedes-Benz Group AG (MBGAF - Free Report) , Wabash National (WNC - Free Report) and Modine Manufacturing (MOD - Free Report) , all sporting a Zacks Rank #1 (Strong Buy).
Mercedes-Benz develops, manufactures and sells passenger cars, including premium and luxury vehicles. The Zacks Consensus Estimate for MBGAF’s 2023 sales implies year-over-year growth of 3.57%.
Wabash is one of the leading manufacturers of semi-trailers in North America. The Zacks Consensus Estimate for WNC’s 2023 sales and earnings implies year-over-year growth of 13.06% and 24%, respectively.
Modine operates primarily in a single industry consisting of the manufacture and sale of heat transfer equipment. The Zacks Consensus Estimate for MOD’s 2023 sales and earnings implies year-over-year growth of 11.43% and 43.09%, respectively.
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Ford (F) to Invest $3.5 Billion to Build LFP Battery Plant
Ford (F - Free Report) announced a massive investment of $3.5 billion in a lithium iron phosphate battery (LFP) plant, which will add nearly 35 gigawatt hours/year of new battery capacity for the auto giant in the United States. With this capacity, Ford can power as many as 400,000 future EVs. LFP batteries are more durable and use low-demand and more cost-effective materials. These batteries will power a range of next-generation, affordable electric passenger vehicles and trucks. The inclusion of these low-cost batteries in its EV lineup will help Ford gain scalability and make EVs accessible and affordable for customers.
With this new battery chemistry, in addition to the existing nickel-cobalt-manganese (NCM) battery, customers will get a chance to choose an EV with a range of different battery performances more specific to their needs. This advancement will pave the way for Ford’s target to boost its EV production, offer more choices to potential customers and help the company achieve an 8% EBIT margin by 2026.
Under the Ford+ plan, the company targets delivering 600,000 electric vehicles by the end of 2023 and 2 million by the end of 2026. With this $3.5 billion investment, Ford and its battery collaborators have, so far, invested $17.6 billion in EV and battery production in the United States to progress towards the company’s commitment of investing $50 billion in EVs till 2026.
Ford is the first automaker that has pledged to set up both NCM and LFP battery production plants in the United States. Jim Farley, president, and CEO of Ford said, “We’re delivering on our commitments as we scale LFP and NCM batteries, and thousands and soon millions, of customers, will begin to reap the benefits of Ford EVs with cutting-edge, durable battery technologies that are growing more affordable over time.”
Ford aims to increase production capacity and reduce wait times for customers. For that, it plans to introduce LFP batteries on the Mustang Mach-E model this year and the F-150 Lightning model next year, well ahead of the opening of a new battery plant. LFP battery technology helped Ford look beyond critical minerals used in traditional batteries and create a healthy and sustainable EV supply chain within the country.
Zacks Rank & Key Picks
F currently carries a Zacks Rank #3 (Hold).
A few top-ranked players in the auto space include Mercedes-Benz Group AG (MBGAF - Free Report) , Wabash National (WNC - Free Report) and Modine Manufacturing (MOD - Free Report) , all sporting a Zacks Rank #1 (Strong Buy).
Mercedes-Benz develops, manufactures and sells passenger cars, including premium and luxury vehicles. The Zacks Consensus Estimate for MBGAF’s 2023 sales implies year-over-year growth of 3.57%.
Wabash is one of the leading manufacturers of semi-trailers in North America. The Zacks Consensus Estimate for WNC’s 2023 sales and earnings implies year-over-year growth of 13.06% and 24%, respectively.
Modine operates primarily in a single industry consisting of the manufacture and sale of heat transfer equipment. The Zacks Consensus Estimate for MOD’s 2023 sales and earnings implies year-over-year growth of 11.43% and 43.09%, respectively.
You can see the complete list of today’s Zacks #1 Rank stocks here.