Ford has signed a memorandum of understanding (MoU) with South Korean battery maker SK Innovation to establish a joint venture (JV) to manufacture batteries for electric vehicles (EVs).

Named BlueOvalSK, the JV will produce traction battery cells and array modules with an annual capacity of 60GWh. Production is expected to start from the middle of the decade.

These battery cells and arrays will be used to power battery EVs produced by Ford in future.

Under the JV, SK Innovation will supply batteries for Ford’s F-150 Lightning, a fully electric version of the company’s iconic F-150 pickup truck.

SK Innovation CEO and president Kim Jun said: “We are delighted to be entering into collaboration with Ford, America’s leading and iconic automaker.

“Ford is one of the most active players in vehicle electrification today and we are proud to be opening this new chapter in their long history.

“Our JV with Ford will play a pivotal role in fleshing out the EV value chain in the United States, a key objective of the current US administration.”

Ford president and CEO Jim Farley said: “This MoU is just the start. It’s a key part of our plan to vertically integrate key capabilities that will differentiate us far into the future.”

The formation of the JV is subject to the signing of definitive agreements, regulatory approvals and other conditions.

The step comes at a time when Ford is increasing investments in EV research and development.

According to the company, the annual energy demand for its EVs will rise to 140GWh a year in North America and up to 240GWh globally by 2030.

Ford is working with several battery suppliers to ensure a stable supply of batteries for next-generation Ford and Lincoln battery EVs.

SK Innovation currently operates a battery plant in Georgia, US, and is expanding its production capacity in the EU and China.

The company specialises in developing and commercialising lithium nickel manganese cobalt oxide (NMC) battery technology.