The U.S. Department of Energy (DOE) announced a conditional commitment to provide a loan of up to $9.2 billion to Ford and South Korean battery company SK Innovation’s joint venture BlueOval SK, to support the company’s construction of new battery plants that will supply Ford and Lincoln EVs.
The announcement marks the largest single loan to date for the DOE’s Loan Programs Office (LPO).
According to the DOE, the new loan supports several Biden administration goals and initiatives, including its Investing in America agenda to boost domestic manufacturing of clean energy and future transportation technologies, its mandate for zero emissions vehicles to make up half of new vehicle sales in the U.S. by 2030, and its ambition to achieve a carbon pollution-free power sector by 2035.
Ford and SK announced the launch of BlueOval SK in 2021, as part of a major expansion of Ford’s electric vehicle ecosystem, and the largest-ever manufacturing investment at one time by any automotive manufacturer in the U.S.
The company is building three large-scale battery plants, including one in Tennessee, which will form part of Blue Oval City, a 3,600-acre campus covering nearly 6 square miles, housing a vertically integrated ecosystem for the assembly of Ford’s expanded lineup of electric F-Series vehicles, and two in Kentucky. At launch, Ford said that the Tennessee assembly plant will be carbon neutral from the launch of production in 2025, with zero waste to landfill once fully operational.
Together the plants are anticipated to enable 120 gigawatt hours of battery production annually, sufficient to displace 455 million gallons of gasoline per year.
The DOE said that the project is expected to create a total of approximately 5,000 constructions jobs in Tennessee and Kentucky, and that BlueOval SK is partnering with the state governments to support new technical schools aimed at providing local training for jobs at the facilities.