Ford Motor Co. is further pulling back on its electric vehicle (EV) ambitions, allowing Japanese rival Nissan to use part of one of its flagship US battery factories in Kentucky, according to people familiar with the matter. The move comes as Ford and other automakers face mounting financial pressure from weak EV sales, high costs, and rising tariff risks, the Wall Street Journal reported.
The Kentucky battery plants were once the centerpiece of Ford’s aggressive $7 billion EV investment announced in 2021. Built in partnership with South Korean battery manufacturer SK On under the BlueOval SK joint venture, the two facilities were expected to power Ford’s next-generation EV lineup. But today, one factory sits idle, while the other is only partially operational—and now will also supply batteries to Nissan, marking a significant retrenchment in Ford’s electrification strategy.
A costly shift amid steep EV losses
The decision reflects broader turbulence in the EV market. Ford has already lost $5 billion on its EV operations in 2024 and projected another $5 billion loss for 2025. Earlier this month, the company suspended its financial guidance for the year, citing uncertainty over tariffs. A Ford spokeswoman declined to comment directly on the matter, referring all questions about the battery facility to the BlueOval SK joint venture, which also declined to confirm Nissan’s involvement.
Nissan gains a foothold in US battery production
For Nissan, the arrangement offers a critical lifeline. The carmaker reported a $4.5 billion loss in the first quarter of 2025 and recently announced 20,000 job cuts while cancelling a planned battery plant in Japan. With US trade policies penalizing imported vehicles and components, local battery production is an attractive option for Nissan, which plans to manufacture electric SUVs at its Canton, Mississippi facility. The company had previously said SK On would supply batteries for that plant, though details of production location remain undisclosed.
A Korea-based spokesperson for SK On said the company has not yet finalized the US location for Nissan battery production. Meanwhile, Nissan referred questions back to the battery supplier.
EV market faces a broader slowdown
The EV sector is showing signs of strain across the board. Electric vehicle sales dropped 5% in April, even as overall auto sales grew. In response, Congress is considering scaling back tax incentives that have helped drive EV purchases in recent years. Automakers are reacting swiftly. General Motors recently exited a joint venture battery plant in Michigan, selling its stake to Korean partner LG Energy Solution. GM’s other battery plants are running well below capacity, with the Tennessee plant at just 40% of its expected output.
Honda, another major player in the EV space, announced this week it was cutting over $20 billion in planned EV spending and delaying construction of a factory in Canada.
Tennessee plant still on track—for now
Despite these setbacks, Ford has not entirely abandoned its EV infrastructure plans. The company says the timeline for its Tennessee battery plant, also part of the BlueOval SK venture, remains unchanged. The Department of Energy had issued a $9.63 billion loan to support the construction of the three plants—two in Kentucky and one in Tennessee. Combined, they were expected to create more than 5,000 construction jobs and another 7,500 operational roles at the joint venture.
A new chapter for Ford’s EV strategy
Still, the shared use of the Kentucky plant with Nissan signals a shift in Ford’s strategy, reflecting the harsh new reality for automakers: bold bets on electric vehicles now come with much greater risks and slimmer margins than anticipated. As the industry recalibrates, the future of EV production in the US may look very different from the grand visions laid out just a few years ago.
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