The U.S. Energy Department (DOE) has finalized a $9.63 billion loan to Blue Oval SK, a joint venture between Ford Motor Company and South Korean battery maker SK On, to support the construction of three new EV battery manufacturing plants in Tennessee and Kentucky. This low-cost government loan, part of the Advanced Technology Vehicles Manufacturing (ATVM) program, marks the largest loan issued under the initiative to date.
The finalized amount exceeds the $9.2 billion conditional commitment announced in June 2023, signaling the Biden administration's continued focus on accelerating the development of electric vehicles (EVs) and domestic battery production. The loan comes at a pivotal moment, just weeks before President-elect Donald Trump takes office. Trump and his team have expressed criticism of the Biden administration's policies to incentivize EV production.
The three battery manufacturing plants, spanning 4 million square feet each, are expected to deliver over 120 gigawatt-hours of U.S. battery production annually. Blue Oval SK has already invested $11 billion into the facilities, with production at the first Kentucky plant slated to begin in 2025 and operations in Tennessee expected to follow later that year.
This loan aligns with the DOE's broader efforts to strengthen EV infrastructure and domestic manufacturing capabilities. Earlier this month, the DOE proposed a $7.54 billion loan for the StarPlus Energy joint venture between Stellantis and Samsung SDI to support the construction of two EV battery plants in Indiana. Additionally, DOE plans to loan Rivian up to $6.6 billion to build an EV plant in Georgia starting in 2028.
In December 2022, DOE finalized a $2.5 billion loan for the General Motors-LG Energy Solution joint venture to fund three battery cell manufacturing facilities in Ohio, Tennessee, and Michigan.
These strategic investments underscore the U.S. government's commitment to bolstering EV adoption, reducing carbon emissions, and securing domestic energy independence. By supporting projects like Blue Oval SK, the DOE aims to solidify the United States' position as a global leader in EV battery production while creating jobs and strengthening supply chains.