The U.S. Energy Department on Thursday said it intends to loan a joint venture of Ford Motor (F.N) and South Korean battery maker SK On up to $9.2 billion to help finance construction of three new battery manufacturing plants in Tennessee and Kentucky.
The conditional commitment for the low-cost government loan for the Blue Oval SK joint venture comes from the government's Advanced Technology Vehicles Manufacturing (ATVM) loan program. SK On is a unit of South Korea's SK Innovation (096770.KS). The joint venture is building three battery manufacturing facilities in Kentucky and Tennessee capable of collectively producing more than 120 gigawatt hours annually, the Energy Department said.
The department said the plants will displace more than 455 million gallons of gasoline per year for the lifetime of the vehicles powered by these batteries. The project is expected to create a total of approximately 5,000 construction jobs in Tennessee and Kentucky, and 7,500 operations jobs once the plants are producing batteries.
Last year, the department awarded a joint venture of General Motors Co (GM.N) and LG Energy Solution (373220.KS) $2.5 billion to help finance construction of new lithium-ion battery cell manufacturing facilities. The loan to Ultium Cells LLC is for facilities in Ohio, Tennessee, and Michigan.
