Shares of Chinese electric vehicle and battery manufacturer BYD saw renewed strength in Hong Kong trading, buoyed by reports of advanced discussions with Ford Motor Company. According to media sources, the talks center on a potential supply agreement for batteries to be used in Ford’s hybrid vehicle lineup, raising the prospect of a significant global expansion of their existing partnership.
Negotiations for Hybrid Vehicle Batteries
Citing a report from The Wall Street Journal, sources indicate Ford and BYD are negotiating a supply pact. One potential framework under discussion involves BYD providing battery cells to Ford manufacturing plants located outside the United States. While Ford has acknowledged ongoing conversations with multiple suppliers on various topics, BYD has not publicly commented. A Bloomberg report suggests an agreement with BYD is not considered imminent, as the American automaker continues to evaluate several potential battery suppliers.
For Ford, securing access to BYD’s competitively priced battery technology would represent a strategic move. This aligns with the company’s December 2025 announcement to scale back its pure-electric vehicle programs, book a $19.5 billion impairment charge, and pivot more aggressively toward hybrid powertrains.
Political Headwinds in the United States
The prospect of a deal has drawn immediate criticism from certain political quarters in Washington. White House trade advisor Peter Navarro, via the social media platform X, accused Ford of strengthening a Chinese supply chain while simultaneously becoming dependent on it. This political dimension introduces considerable uncertainty, particularly if batteries were destined for vehicles sold in the U.S. market. Potential restrictions or incentives stemming from U.S. industrial and trade policy could significantly shape the final terms of any agreement.
A Strategic Boost for BYD’s Battery Division
These discussions highlight BYD’s evolving identity as a major global battery producer, a role that now stands alongside its status as the world’s largest electric vehicle maker. The company first established itself as a significant battery manufacturer before its dramatic rise in the automotive sector.
Analysts at Bernstein Research estimate BYD’s battery shipments grew by 47% in 2025, reaching 286 gigawatt-hours. Although the majority of its production capacity remains in China, BYD is actively expanding its manufacturing footprint into Southeast Asia, Europe, and Brazil. A formal supply contract with a legacy automaker like Ford would further validate the competitiveness of its technology and bolster its international battery business.
Should investors sell immediately? Or is it worth buying BYD?
Building on an Existing Foundation
A new agreement would not mark the beginning of the relationship between the two companies. Ford has utilized BYD-sourced batteries since 2020 in vehicles produced through its Changan Ford joint venture in China. The recently launched Ford Bronco plug-in hybrid electric vehicle (PHEV) in the Chinese market, for instance, uses batteries from Findreams, a BYD subsidiary. A broader deal would therefore build upon established technical and operational ties, but with the potential for vastly greater volume and geographic scope.
Market Performance and Business Trends
BYD’s stock has experienced heightened volatility at the start of 2026, trading between HK$92.50 and HK$100.30 over the past month. Despite a recent recovery, the share price remains approximately 37% below its 52-week high of HK$159.27, reflecting persistent investor concerns over EV sector growth and intense competition within China’s domestic market.
On the operational front, BYD’s vehicle deliveries increased to 4.55 million units in 2025, a 7.1% year-on-year rise, though this fell short of the company’s initial target of 5.5 million. The overseas business emerged as a particularly strong growth engine, with international sales exceeding 1 million vehicles for the first time—a surge of 150% compared to the previous year.
Industry observers anticipate BYD will aim to deliver between 5.0 and 5.5 million vehicles in 2026, with international operations increasingly driving growth. Analysts at Goldman Sachs project the company’s non-U.S. overseas sales could reach about 1.5 million units this year.
Outlook: Weighing the Prospects
A finalized agreement with Ford could provide BYD with an additional revenue stream for its battery division while sending a powerful signal regarding its technological prowess to other Western manufacturers. However, no concrete deal is yet in place, and ongoing geopolitical tensions between the U.S. and China remain a fundamental risk factor for any expansive cross-Pacific cooperation.
Further clarity on BYD’s recent business performance is expected when the company releases its fourth-quarter 2025 results, anticipated for late March or early April. This report will also offer a clearer view of the current contribution the battery business makes to BYD’s overall financial picture.
Ad
BYD Stock: Buy or Sell?! New BYD Analysis from January 16 delivers the answer:
The latest BYD figures speak for themselves: Urgent action needed for BYD investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from January 16.
BYD: Buy or sell? Read more here...
