Dive Brief:
- The Department of Energy on Thursday said it intends to loan up to $9.2 billion to a joint venture between Ford and battery maker SK On to help finance their three upcoming battery manufacturing plants.
- The loan, one of the largest ever issued by the department, will fund two joint venture battery sites in Kentucky and one in Tennessee, which were announced by Ford last summer.
- Together, the plants will provide over 120 GWh of domestic battery production per year, with production slated to begin in 2025.
Dive Insight:
Ford has announced a slew of supplier and manufacturing deals to up its battery capacity over the past year as it works toward an annual run rate of over 2 million EVs by 2026.
As the automaker finalized its joint venture, Blue Oval SK, last July, it also signed several non-binding memorandums of understanding with raw battery material suppliers to support its new partnerships.
Blue Oval SK was formed as part of Ford’s plan to support its production goals for a growing EV lineup, according to the Energy Department’s announcement.
The joint venture is currently working to cultivate a network of component suppliers. In addition, the venture is working with Tennessee and Kentucky officials to create local workforce development initiatives.
Outside of its trio of facilities with SK On, Ford has a separate $3.5 billion lithium iron phosphate battery facility in Michigan in the pipeline.
Ford’s loan from the department’s Advanced Technology Vehicles Manufacturing loan program, which supports the domestic manufacturing of vehicles and qualifying components that improve fuel economy, is one of the first granted for a battery manufacturing project.
General Motors’ joint battery venture was granted the first loan for such a project in December, receiving $2.5 billion.
