Shares of Ford Motor (F) rallied sharply on Wednesday, outperforming the broader market as investors reacted positively to analyst commentary surrounding the company’s growing energy storage business and its long-term profitability potential.
Ford shares climbed as much as 13.15% to $13.56 during trading, making the automaker one of the best-performing stocks in the S&P 500, according to Dow Jones Market Data.
The gains far outpaced moves in other major auto stocks, with General Motors rising 0.4%, Stellantis advancing 2.7%, and Tesla gaining 3.9%.
The rally came as investors focused on Ford’s recently announced energy storage initiative, which analysts believe could become a meaningful contributor to the company’s earnings over the coming years.
Morgan Stanley highlights Ford Energy opportunity
The latest momentum followed a bullish research note from Morgan Stanley analyst Andrew S. Percoco, who described Ford Energy as an “Underappreciated driver of Model e path to profitability.”
Ford’s Model e electric vehicle division lost $4.8 billion in 2025, but analysts see the company’s expansion into energy storage as a potential offset to losses in the EV business.
Earlier this week, Ford announced Ford Energy, a business focused on delivering “United States-assembled battery energy storage systems for utilities, data centers, and large industrial and commercial customers in the United States.”
Battery energy storage systems use lithium-ion batteries similar to those found in electric vehicles to store power generated by renewable sources such as solar and wind.
The systems help stabilize energy supply and improve reliability for commercial customers and utilities.
Percoco said, “We believe Ford’s relationship with CATL is an underappreciated strategic competitive advantage for its Energy Storage business. Through this relationship, Ford becomes a key supplier of compliant ESS systems to utility and data center customers in the US.”
CATL partnership seen as strategic advantage
Ford plans to source batteries for the energy storage business from its Michigan battery plant, which was built using licensed technology from Contemporary Amperex Technology Co. Ltd., the world’s largest lithium-ion battery maker.
According to Morgan Stanley, Ford’s access to CATL’s lithium iron phosphate technology positions the company favorably in meeting Foreign Entity of Concern compliance standards.
Those standards are necessary for customers seeking eligibility for the 30% Investment Tax Credit tied to energy storage projects.
Morgan Stanley estimates Ford Energy could generate between $500 million and $600 million in run-rate EBIT at 20 gigawatt hours of production capacity.
Ford plans to deploy “at least 20 gigawatt hours annually, with first customer deliveries planned for late 2027.”
Tesla, already a major player in energy storage, has deployed approximately 45 gigawatt hours of battery storage over the past 12 months.
Investors reassess Ford’s growth potential
Percoco also suggested additional business announcements could arrive soon.
“We believe that there is a fairly high likelihood that Ford signs an energy storage system supply agreement with large commercial customers, and potentially hyperscalers, over the next few months,” he wrote.
The analyst expects Ford Energy to become profitable by 2028 and contribute nearly $600 million in operating profit by 2030.
By comparison, Ford is expected to generate roughly $9.5 billion in operating profit in 2026, according to FactSet estimates.
Morgan Stanley maintains a Hold rating on Ford shares with a $14 price target.
Ford previously announced a $2 billion investment into the energy storage business late last year, though the move initially faced skepticism as it coincided with a $20 billion write-down in the company’s electric vehicle operations.
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