Ford and SK receive $9.6 billion in loans from the U.S. government

Ford and South Korean battery maker SK On secured a massive $9.63 billion loan from the U.S. Department of Energy to build three electric vehicle battery manufacturing plants in Tennessee and Kentucky.

In June 2023, it was initially reported that Ford and SK On would receive a $9.2 billion loan to help build three factories. It’s unclear why the loan amount increased, but it is the largest loan offered by the U.S. government’s Advanced Technology Automotive Manufacturing Program. The program is designed to help U.S. companies catch up with industry-leading Chinese battery manufacturers.

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The funds will be provided to Blue Oval SK, a joint venture operated by the two companies. They have invested more than $11 billion to build the three plants. The first of two plants in Kentucky is scheduled to begin production in early 2025, with the Tennessee plant set to be ready to begin production in late 2025.

When all three bases are completed and put into operation, they will be able to produce 120 GWh of electric vehicle batteries per year.

Blue Oval SK told Reuters in an interview that it took the energy ministry 18 months to complete the loan process because of the time required to conduct due diligence, including market, credit, financial, legal and regulatory reviews.

This isn’t the only major EV loan announced in recent weeks; just before Donald Trump returned to the presidency, the U.S. Department of Energy announced a conditional commitment of $7.54 billion to a joint venture operated by FCA US and Samsung SDI USD loan to build two lithium-ion battery and module manufacturing plants in Kokomo, Indiana. Rivian also recently received approval for a $6.57 billion loan from the U.S. Department of Energy, though the loan is being closely watched by Vivek Ramaswamy, who will work with Elon Musk together to lead the new Ministry of Government Effectiveness.