Ford Motor Co. said on Monday it signed a long-term deal with Nemaska Lithium for the supply of lithium products, including lithium hydroxide, as the automaker ramps up electric vehicle production to 2 million units by the end of 2026.
The announcement comes as the automaker holds an investor day meeting Monday morning.
The deal with the Canadian lithium company comes as North American automakers race to secure supplies of battery materials to boost EV output amid surging demand for environment-friendly vehicles.
Earlier this year, Ford joined PT Vale Indonesia and China’s Zhejiang Huayou Cobalt’s as their new partner in a $4.5 billion nickel processing plant in Indonesia.
The deal announced on Monday will strengthen “Ford’s sourcing to produce two million EVs by the end of 2026 – and beyond,” at a time when doubts linger on Wall Street about the automaker’s ability to hit that target.
Ford also disclosed a five-year agreement with Albemarle Corp. to supply more than 100,000 metric tons of battery-grade lithium hydroxide for about three million future Ford EV batteries.
The lithium hydroxide produced by Nemaska should help qualify Ford vehicles for consumer tax benefits under the U.S. Inflation Reduction Act, the automaker said.
Ford reaffirmed its full-year guidance of $9 billion to $11 billion of adjusted earnings before interest and taxes and about $6 billion in adjusted free cash flow.
The automaker continues to expect its EV unit to lose $3 billion this year.
Nemaska Lithium is equally owned by Investissement Québec, the economic development agency of the Québec government, and Livent.