Ford is pulling back on EVs and getting in on the AI boom with data center battery storage

Core Viewpoint - Ford is shifting its focus from electric vehicles (EVs) to energy storage solutions, resulting in a $19.5 billion cost due to the cancellation of planned electric models and a pivot towards hybrid vehicles [1][12]. Group 1: Strategic Shift - Ford will repurpose its EV battery factory in Kentucky to produce batteries for data centers and energy infrastructure [1][8]. - The company plans to invest $2 billion to scale its new energy storage business, aiming to deploy at least 20 gigawatt-hours of energy storage systems by the end of 2027, which can power approximately 2,000 US homes for a year [2][8]. Group 2: Market Dynamics - Demand for EVs has significantly decreased, dropping from 12% to 5% of the US automotive market, prompting Ford to adjust its strategy [12]. - The data center power demand is projected to triple over the next three years, driven by substantial investments from tech giants in AI infrastructure [6]. Group 3: Competitive Landscape - Ford's new direction mirrors that of Tesla, which has successfully established a profitable energy storage business, generating over $10 billion last year from battery sales [9]. - Tesla's Megapack batteries are being utilized in major data centers, showcasing the potential for energy storage solutions in supporting AI infrastructure [10].