Fueling bullish sentiment is last week’s news that Ford (NYSE: F) and Redwood Materials are working together to build and expand upon battery recycling efforts and a domestic battery supply chain for EVs.
The legendary car maker’s stock is up over 9% in the last 5 days, and 110% in the last 12 months, due to overall growing optimism over the company’s moves into the electric vehicles space.
Ford and Redwood’s partnership
Redwood is based in Nevada, United States, and was founded by former Tesla Chief Technology Officer, Jeffrey Brian Straubel. Redwood works with battery manufacturers to recycle production scrap and then collaborates with automakers on the process of end-of-life EVs. The company said that Ford is investing $50 million in it to help widen its manufacturing footprint.
The plan for the partnership is to integrate recycled battery materials by using scrap from battery production and old batteries which are about to run out. This will help boost Ford’s battery supply chain, decrease costs, and minimize the company’s environmental footprint.
Ford is planning to spend $30 billion in electrification efforts by 2025. Part of this investment will be used to expand its EV models, Mustang Mach-E, the 2022-model E-Transit van, set to launch in 2021, and the 2022-model F-150 Lightning light truck, said to hit dealerships spring next year. By 2030, Ford plans that around 40% of its vehicle production will be electric.
Another important step is that it will allow Ford to secure the battery materials to help it ramp up its EV production, which is great news for investors. Ford’s EV plans are driving up the stock at the moment as many realize the future of the auto industry lies with green-powered technology. As the U.S. has a goal to reduce greenhouse gas emissions by 50% by 2030 and make 50% of all new vehicles sold in 2030 zero-emissions vehicles. This trend is very on-topic and proves that Ford is thinking long-term with its strategies.
“But recycling is just the first step in creating a circular supply chain. We’ll be collaborating to determine how, together, we can create pathways for consumer vehicles to come off the road at the end of their life and be recycled and manufactured into battery materials to make more Ford EVs,”
“As part of this relationship, we’re discussing how Redwood could supply Ford’s American battery facilities to ensure a steady, domestic source of sustainable battery materials to fuel the production of Ford electric vehicles.”
Is Ford stock a buy?
Redwood said it is hoping to use its relationship with Ford to come up with innovative ways to expand the entire lifecycle of a battery. Innovative technology, further EV aspirations, and big investments in forward-thinking business partnerships — what else could you want from a long-term investment?
Ford, which manufactures automobiles under its namesake and Lincoln brands, has around 14% market share in the U.S. and about 7% in Europe, making it a great play to get in on the EV boom. With new investments, business partnerships, and exciting new green-powered models in the pipeline, EV investors would be right to keep an eye on this company.
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Financial Writer at MyWallSt
Nicole's favorite stock is Etsy because she loves its original and handmade items. She believes people are going to stop buying mass-produced items and start purchasing ‘one of a kind’ fashions and furnishings. In a world of sameness, Etsy has the advantage.