Ford EV Partner SK Says Battery Unit Will Break Even By 2025

May 3, 2024 10:58 am

As global demand for EVs has slowed over the past few months, Ford EV supplier and battery manufacturer SK On has admitted that it expects this trend to continue in the short term, but the company still has a rosier outlook for the long term. In the meantime, SK On continues to expand its relationship with other automakers, though it will undoubtedly be impacted by a shift in plans – such as FoMoCo’s decision to delay the production start of its next-generation Ford F-150 EV. Regardless, the South Korean battery maker still expects to break even by 2025, according to Reuters.

In fact, SK On is expected to hit the break even point by the second half of 2024, and that belief is backed up by hard data, as SK Innovation’s dedicated battery unit enjoyed a strong Q1 that saw it beat its projections in terms of operating profit. With demand remaining strong for its batteries in spite of an overall slowdown, SK reiterated that it expects this trend to continue through the rest of the year as well.

In the first quarter of the year, SK On recorded an operating profit of 625 billion won ($454 million USD), which is a substantial increase over Q1 2023’s 375 billion won and the average analyst forecast of 466 billion won, even as revenue fell 1.5 percent to 18.9 trillion won. Additionally, SK’s operating loss increased from 18.6 billion in Q4 2023 to 332 billion won in the first quarter of 2024 as shipments of EV batteries declined. Currently, the company expects those battery shipments to improve through the rest of 2024, but cautioned that this is largely dependent on the long-term uncertainty surrounding EVs in general.

“While we saw drops in EV battery shipment in the first quarter… we expect to see an improved market environment backed by launches of new EVs in North America,” SK On Chief Financial Officer Kim Kyunghun said in the company’s post-earnings conference call with investors.

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By Brett Foote

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.