Ford CEO Asks Battery Suppliers to Stop Fighting

Matt Posky
by Matt Posky

Battery suppliers LG Chem and SK Innovation have what could be politely described as an intense rivalry. With the automotive industry desperate to secure reliable access to the most essential components for the planned electric vehicle offensive, chemical companies specializing in electronics are very much in demand and they’re all jockeying for power.

On Wednesday, the U.S. International Trade Commission (ITC) sided with LG Chem after it had accused SK Innovation of misappropriating trade secrets pertaining to EV battery technologies. But Ford CEO Jim Farley is asking the South Korean businesses to call a ceasefire and settle things out of court, presumably through the transfer of a large sum of money.

Ford cares because the ITC indicated that it would be issuing a limited 10-year exclusion order prohibiting SK’s ability to import certain lithium-ion batteries into the United States. But special exemptions will be made for the company to import the components necessary for their production inside the U.S. and other parts intended for Ford’s F-150 EV program over the next four years. Additional allowances will be made for Volkswagen of America’s planned MEB electric vehicle lineup, though only for two years.

That seems to give sufficient leeway for Blue Oval to get the ball rolling on the all-electric pickup. But Farley took to social media on Thursday to announce that a settlement was the only way the program could continue.

“While we’re pleased the ITC ruling makes way for @Ford to bring to market our groundbreaking electric F-150, a voluntary settlement between these two suppliers is ultimately in the best interest of US manufacturers and workers,” he wrote in response to a Washington Post article about the case.

We’ve been repeatedly confused by how willing the automotive industry has been to let other companies have near-complete control over what is inarguably the most important and valuable component for electric vehicles. In fact, it wasn’t more than two years ago that German Chancellor Angela Merkel was chastising domestic automakers for allowing themselves to become so dependent upon China, Korea, and Japan. But Ford has previously claimed there’s nothing to be gained by building a battery factory, especially considering the swift way in which the industry is currently evolving. While that leaves the company open to losing ground to the handful of automakers that are building their own cells, Ford is hardly the only automaker taking this approach.

“The supply chain has ramped up since Elon [Musk] built his Gigafactory, and so there’s plenty there that does not warrant us to migrate our capital into owning our own factory,” Ford’s last CEO, Jim Hackett, suggested during last summer’s earnings call. “There’s no advantage in the ownership in terms of cost or sourcing.”

Perhaps Hackett couldn’t foresee Ford’s battery supplier losing a court case that would place limitations on its ability to import products into the United States.

Obviously, SK Innovation is displeased with the ITC’s decision. But it issued a reminder that the 60-day presidential review gave an opportunity for President Joe Biden to reverse the ruling. Considering how obsessed the administration appears to be with transitioning toward electric vehicles and moving away from fossil fuels, we suppose there’s a chance. But it wouldn’t be clear how it would benefit America more than having the nation build its own batteries. And wasn’t the Biden-Harris ticket promising an avalanche of new jobs in the energy sector? This seems like a golden opportunity to try and make good on that promise.

[Image: JL IMAGES/Shutterstock]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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4 of 21 comments
  • El scotto El scotto on Feb 14, 2021

    Most EV aren't cheap, perhaps causing some jealousy from commenters and causing attempted derisive comments. EV are now getting cheap enough they can become the commuter beast in a two-car family. EV CARS have been covered and discussed at length on here. No one has expressed any comments on the "white paint work vehicle" armada. Delivery vans of all sizes and pick-ups will be EV's true breakthrough. In a year or two we may have fleet managers commenting on here about their work fleets.

  • El scotto El scotto on Feb 14, 2021

    Is it true that Stellantis' total EV research is some guy in Turin rubbing two magnets together and three guys near Lyon wiring up a toy train transformer? Ok, I kid but not by much. The last and the lagging in EV efforts will bought by the Chinese. Include an outside shot of Ford becoming part of the VW group.

    • See 1 previous
    • Conundrum Conundrum on Feb 15, 2021

      @SCE to AUX Stellantis is more than Fiat and Chrysler. Peugeot and Citroen make EVs and the latest Fiat EV has a 200 mile range. The world is not the USA.

  • NotMyCircusNotMyMonkeys dudes off the rails on drugs and full of hate and retribution. so is musky.
  • Big Al from Oz Musk and Trump are of the same ilk, except Musk's IQ is a damn site higher than Trumps. Musk like Trump is only into himself. Musk doesn't care about Trump only Musk. Musk sees more dollars if Trump wins.Hey, I'm Big Al again!3
  • Rover Sig We have a car with two fake exhausts in the bumper, but a large shiny muffler visible hanging down on one side, not aligned with the fake exhaust exits. Horrendous. I had to paint the shiny muffler with high-temp black paint to make it less visible. Exhaust pipes were meant to be round and hang below the bumper, and they can be made quiet or loud as the engineers like. But fake exhausts rank down there with fake intake vents on the side of that old Buick.
  • EBFlex Of course it does. What a silly question
  • Buickman Elon is a phony.