The mammoth loan to Ford of $9.2 billion dollars from the US Government is conditional and will help the automaker build three new battery plants. Ford’s BlueOval SK, a joint venture between the automaker and South Korean battery giant SK On Co, is the direct beneficiary. All three facilities are already under construction.
The loan comes from the Department of Energy and more specifically out of a program designed to help the US catch up to China in terms of battery technology. Last year, Ford increased spending on electric vehicles by about $20 billion. The three factories that will see cash from this loan are said to cost around $11.4 billion.
These investments are part of Ford’s plan to increase EV production to the point that it makes up half of its total volume by 2030. Last year it built almost 135,000 EVs but hopes to reach up to 2 million per year by 2026. That’s a huge jump and adding these three battery plants will enable it to scale more quickly.
Read: Ford F-150 Lightning EV’s Range Drops By Nearly 25% When Loaded-Up, Study Finds
The move comes at a time when a huge number of electric vehicle announcements are making waves. The Biden Administration’s Inflation Reduction Act provided quite a lot ($370 billion) of financial incentives to increase EV adoption.
According to Bloomberg, more than 100 battery and EV production projects, representing some $200 billion, are either announced or already underway.
Located in Tennessee and Kentucky, the trio of plants is already under construction. BlueOval City in Stanton, Tennessee will build both batteries and “a revolutionary all-new electric truck.” Another location in Kentucky dubbed BlueOvalSK Battery Park will contain two facilities. Production is scheduled to commence in 2025 at all three sites.
While we’ll have to wait to see if Ford can meet its production goals in the long term, the chances that it succeeds look a lot better after this news. Maybe Tesla will end up with a serious competitor for the cars most “made-in-America” sooner rather than later.
