Core Viewpoint - LG Energy Solution Ltd (LGES) has had its battery supply contract with Ford Motor Company, valued at KRW 9.6 trillion (US$ 6.5 billion), canceled due to Ford's strategic shift in electric vehicle (EV) production and demand forecasts [1][2]. Group 1: Contract Cancellation - Ford has notified LGES of the cancellation of a contract for the supply of 109 gigawatt-hours (GWh) of nickel-cobalt-manganese (NCM) batteries, originally intended for Ford's light commercial vehicles (LCVs) from 2026 to 2032 [1]. - The cancellation is attributed to Ford's decision to discontinue certain EV models in response to recent policy changes and shifts in EV demand forecasts [2]. Group 2: Ford's Strategic Shift - Ford announced a US$ 19.5 billion one-off charge as part of its efforts to reshape its EV strategy, which includes pulling back from larger battery electric vehicle (BEV) models and focusing on hybrids and extended-range vehicles [2][3]. - The company aims to align its capital spending with customer demand and higher-return opportunities, targeting profitability for its Model e EV unit by 2029, with expected yearly improvements starting in 2026 [3]. Group 3: Leadership Statements - Ford's president and CEO, Jim Farley, emphasized that the changes are customer-driven, aimed at creating a stronger, more resilient, and profitable Ford [4]. - Farley noted that the operating reality has changed, prompting the redeployment of capital into higher-return growth opportunities [4].