Seoul: LG Energy Solution Ltd. announced on Wednesday that it received a notification regarding the cancellation of a substantial 9.6 trillion-won (US$6.5 billion) battery supply contract with Ford Motor Co. that was agreed upon last year.

According to Yonhap News Agency, the cancellation is attributed to Ford's decision to halt the production of specific electric vehicle (EV) models. This decision follows recent policy changes and revised forecasts in EV demand, leading to a contract termination notice. The original agreement, signed in October 2024, entailed LG Energy Solution supplying 34 gigawatt-hours (GWh) of batteries to Ford from 2026 to 2030, with an additional 75 GWh slated for 2027 to 2032 to support Ford's commercial vehicle segment.

The batteries were intended to be manufactured at LG Energy Solution's facility in Poland. However, the contract's termination aligns with Ford's recent strategic shift. The automaker has revised its business approach, reducing its focus on all-electric vehicle models and directing its attention towards hybrid trucks and the energy storage sector.