South Korean battery major LG Energy Solution (LGES) reached a new supply agreement with US carmaker Ford for commercial vehicles in Europe, Kallanish learns.

Under an undisclosed deal, LGES will provide batteries produced at its factory in Poland to power commercial vans in the UK and EU markets. A total of 109 gigawatt-hours has been secured through a contract that starts in 2026 and runs for 4-6 years.

Additionally, the companies decided to rearrange a previous procurement agreement to take advantage of IRA tax credits. Batteries for Ford’s Mustang Mach E vehicles will be sourced from LGES’ Michigan plant, instead of Wrocław, Poland.

In a statement on Tuesday, LGES explains the move will enhance business efficiency and capitalise on competitive market conditions.

“Capitalising on our local production capacity, we will secure leadership in the European market and deliver unmatched values to our customers through advanced battery technologies that effectively address diverse needs,” says LGES ceo David Kim.

The top executive adds the contracts reflects LGES’ experience and expertise in powering commercial vehicles with “innovative” battery technologies. He did not disclose technical details of the batteries and their chemistries.  

Poland’s gigafactory has capacity to produce around 90 GWh per year, while the plant in Michigan is undergoing an expansion plan to increase capacity to 25 GWh.

Kallanish has contacted the company for comment.