Ford's EV Battery Facility Poised to Welcome Nissan as New Partner

Nissan is on the verge of finalizing a deal to obtain electric vehicle batteries from a collaboration between Ford adn South Korea’s SK On, as per insiders familiar with the negotiations.

this move is partly motivated by Nissan’s desire to avoid hefty tariffs that were enacted under former President Trump. For Ford and SK on, partnering with Nissan could provide a much-needed boost in production at a time when electric vehicle sales are experiencing a downturn.

The BlueOvalSK factory in Kentucky has emerged as the leading candidate for manufacturing these batteries for Nissan, although no official decision has been reached yet.

This situation highlights two important challenges facing the automotive sector today: Trump’s 25% tariff on imported vehicles and parts, coupled with declining demand for EVs that’s forcing manufacturers to rethink their enterprising plans for electric models.

In response to these market shifts,Ford is slashing its EV investment by $12 billion and has scrapped plans for an electric SUV in favor of smaller,more budget-friendly models set to launch in 2027. Meanwhile, Nissan announced earlier this year its intention to source batteries from SK On for an upcoming EV slated for production at its Canton plant in Mississippi starting in 2028.

If Ford and SK On can bring Nissan on board as a client, it would allow them to maximize output at their new Kentucky battery facility.Initially designed to support Ford’s E-Transit commercial van—which hasn’t seen high sales numbers—the plant could see increased activity through this partnership.

Nissan along with both companies have opted not to comment publicly about this potential agreement.However, Ford did express that they aim “to establish an efficient capital structure and domestic supply chain that bolsters American jobs” within their EV division.

The Wall Street journal was among the first outlets reporting on these discussions.

Ford is grappling with substantial losses from its electric vehicle segment—$5.1 billion last year alone—and anticipates another $5.5 billion loss this year if trends continue. Considering slowing growth rates within the EV market last year led them and SK On to pause plans for an additional battery plant in Kentucky after receiving a $9.2 billion loan from the U.S Department of Energy aimed at establishing three battery facilities across Kentucky and Tennessee.

Additonally ,Ford expects around $2.5 billion impact due directly from tariffs but believes it can mitigate about $1 billion of those costs through strategic adjustments.