Revving Up the Future: Ford and SK On's $9.63 Billion Battery Bet

The U.S. Energy Department has finalized a $9.63 billion loan to Ford Motor and SK On for three new battery manufacturing plants in Tennessee and Kentucky. This significant investment, part of the Advanced Technology Vehicles Manufacturing loan program, aims to enhance U.S. electric vehicle production and competitiveness.

In a landmark move, the U.S. Energy Department has finalized a colossal $9.63 billion loan to the collaborative venture of Ford Motor and SK On, seeking to spur the construction of three state-of-the-art battery manufacturing facilities in Tennessee and Kentucky. This initiative represents the most substantial loan ever disbursed from the Advanced Technology Vehicles Manufacturing program, underscoring the Biden administration's commitment to boosting electric vehicle production.

First reported by Reuters, this final loan award surpasses the previously announced $9.2 billion conditional commitment for the BlueOval project. With President-elect Donald Trump set to take office shortly, discussions have intensified regarding the current administration's efforts to incentivize EV production. Critics, including Trump and his advisors, have voiced concerns over the scale and impact of these initiatives.

Jigar Shah, head of the DOE Loan Programs office, emphasizes the strategic importance of such programs to counter global competition, particularly from China. The BlueOval SK joint venture anticipates that the new plants will deliver a staggering 120 gigawatt hours of battery production annually by 2025. This move mirrors other DOE initiatives, including proposed loans to enterprises like Stellantis, Samsung SDI, and Rivian, to bolster domestic EV manufacturing capabilities.

(With inputs from agencies.)