Ford launches $2B battery storage unit to power AI data centers amid surging infrastructure demand

Ford has a new battery business to ride the AI wave. Here's where Cramer stands on the stock

CNBC's Jim Cramer said Ford's new battery storage business gives the automaker a credible way to benefit from one of the market's hottest trends: the rapid buildout of artificial intelligence infrastructure. "I love what Ford is doing with this battery business," the "Mad Money" host said Wednesday. Last month, Ford formally launched Ford Energy, a subsidiary focused on supplying large-scale battery storage systems for data centers and the electric grid. Investors initially embraced the move, sending Ford shares to a multi-year high above $17, from below $14 before the announcement. The stock has since retreated to around $14 as of Wednesday's close. "I didn't want to recommend the stock when it was screaming higher last month in response to the news, but now that it's drifted back down to $13.96, that's a different story," Cramer said. "If you believe oil and interest rates are coming down, then you've got my blessing to buy Ford Motor." Cramer said the opportunity comes as demand for battery storage accelerates alongside the construction of new AI data centers. At the same time, he noted that renewable energy projects also depend on storage systems to supply electricity when solar and wind generation falls short. "We know that demand for these big backup batteries is growing like crazy because all the new data centers really can't afford to go offline," he said. Ford plans to produce at least 20 gigawatts of battery storage capacity annually, with its first customer deliveries expected in late 2027. While Cramer thinks Ford Energy could eventually become a meaningful business, he cautioned that investors should view it as a long-term opportunity rather than an immediate earnings driver. For now, its revenues and profits will still come from selling trucks and cars. "If you're thinking long-term, though, I think this makes Ford a more attractive investment," Cramer said.

Ford launches $2B battery storage unit for AI data centres

Ford has launched Ford Energy, a $2 billion subsidiary that will manufacture grid-scale battery storage systems for data centres and utilities using CATL-licensed LFP technology at a repurposed Kentucky plant. It has already signed a five-year deal with EDF Power Solutions for up to 20 GWh. Ford has launched Ford Energy, a wholly owned subsidiary that will manufacture large-scale battery energy storage systems for utilities, data centres, and industrial customers. The company has committed roughly $2 billion to the operation, which repurposes a Kentucky plant originally built for electric vehicle batteries. The subsidiary is led by Lisa Drake, who reports directly to Ford vice chair John Lawler. It marks the clearest signal yet that Detroit's legacy automakers see more immediate profit in powering the AI infrastructure boom than in making the cars that were supposed to justify their battery investments. What Ford Energy builds The flagship product is the DC Block, a standardised 20-foot containerised storage system built around 512-amp-hour lithium iron phosphate (LFP) prismatic cells. Each unit is rated at 5.45 megawatt-hours, and the technology is licensed from CATL, the Chinese battery giant that dominates global cell production. Ford will manufacture the systems at its Glendale, Kentucky facility, which it is converting after scaling back EV production plans and dissolving its BlueOval joint venture with SK On. The company assumed a $3.8 billion Department of Energy loan tied to the plant as part of the restructuring. First customer deliveries are targeted for late 2027, with annual output set to reach a minimum of 20 gigawatt-hours. Ford is not alone in seeing this opportunity, as General Motors announced its own push into grid-scale energy storage earlier this year. The EDF contract Seven days after the formal launch on 11 May, Ford Energy signed its first commercial deal, a five-year framework agreement with EDF Power Solutions North America for up to 4 GWh of battery storage annually. The contract totals up to 20 GWh over its full term, with deliveries expected to begin in 2028. Morgan Stanley analysts have reportedly valued the energy storage business at up to $10 billion as a standalone unit. That figure remains speculative, as Ford Energy has not yet shipped a single system, but it reflects the scale of demand that data centre operators and grid operators are projecting over the next decade. The stock and the scepticism Ford's share price surged roughly 20 per cent in the 48 hours following the Ford Energy announcement, climbing from under $14 to a multi-year high above $17. It has since retreated to around $14, erasing most of the gain. CNBC's Jim Cramer said on 17 June that he believes Ford can become "a real player in the battery storage space," though he cautioned that the business will not meaningfully affect earnings for several years. He added that at around $14, the stock looks more attractive than it did during the spike. The CATL licensing arrangement has drawn scrutiny. CATL appears on a Pentagon list of companies with alleged ties to China's military, and critics have questioned whether a US-assembled product built on Chinese battery technology qualifies as domestic manufacturing under federal procurement rules. Ford has said the systems will be assembled entirely in the United States. CATL has disputed the Pentagon designation. Whether Ford Energy can scale fast enough to matter alongside the automaker's still-struggling EV division remains an open question. But the pivot from making car batteries to making grid batteries is a bet that the energy storage market will grow faster than the electric vehicle market, at least for now.