This article first appeared on GuruFocus.
Ford Motor Co. (NYSE:F) is in discussions with China’s BYD Company about a potential deal to source batteries for some of its hybrid vehicles, according to reports citing people familiar with the matter. The talks follow Ford’s announcement last month of a $19.5 billion write-down as it pivots away from large-scale electric vehicle production toward more affordable hybrid options.
While no deal has been reached, one scenario under discussion would involve importing BYD batteries to Ford manufacturing facilities outside the United States as part of its hybrid strategy. The automaker is exploring potential supply to plants in Germany, Spain, Thailand, and Turkey, according to reports.
Sourcing batteries from BYD could give Ford access to cheaper, advanced battery technology at a time when it faces increasing competitive pressure from Chinese EV manufacturers and continues to reassess its EV investment strategy.
Ford shares closed at $13.81 on January 15, down 0.22%. The discussions have also drawn attention in Washington, where White House trade advisers have raised concerns about the risks of deeper supply-chain dependence on China.
