General Motors and Ford Motor are pursuing new business opportunities in defense and energy storage systems, marking a significant expansion of their long-standing competitive relationship beyond traditional automotive markets.
Both companies have responded to outreach from the Trump administration regarding military manufacturing support, with their initial efforts concentrating on military vehicles. GM established its defense division in 2017 and has already secured major contracts, including a U.S. Army infantry squad vehicle contract potentially exceeding $1 billion. The automaker expects its 2026 defense revenue to reach nearly $700 million. Ford has more recently joined the defense sector this year, following GM’s lead into this market segment.
Simultaneously, GM and Ford are entering the energy storage system market as a way to repurpose manufacturing capacity and technology originally developed for electric vehicles. The global ESS market is projected to grow substantially, from $668.7 billion in 2024 to $5.12 trillion by 2034, according to Global Market Insights. Ford has committed $2 billion to launch its energy business and plans to convert a Kentucky battery factory to produce energy storage units by late 2027. GM is developing next-generation sodium-ion batteries through a partnership with Peak Energy and has agreements with other companies for battery reuse and residential energy solutions.
Both automakers have faced significant financial challenges in their electric vehicle operations, losing billions on EV efforts as consumer demand fell short of projections. Analysts view the defense and energy storage markets as complementary opportunities that could help diversify revenue streams without requiring major asset sales. While these new ventures are expected to represent relatively small portions of each company’s business in the near term, they could provide meaningful contributions to profitability and help offset declining traditional vehicle sales in the U.S. market.
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