The Department of Energy is loaning Ford and its battery manufacturing partner $9.2 billion to finance the construction of three electric vehicle battery plants in Tennessee and Kentucky, a massive cash infusion meant to ramp up domestic battery manufacturing capabilities to compete with China.
The conditional loan agreement, granted to Ford and its Korean battery manufacturing partner by DOE's Loan Programs Office, is the largest government loan made to a U.S. automaker since the 2009 financial crisis and subsequent bailout of the auto industry.
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The Biden administration has raced to build out the electric vehicle and battery manufacturing supply chain in a bid to compete against China and deliver on its goal of having 50% of all new cars sold in the United States be electric vehicles by the year 2030. EVs currently account for roughly 7% of all cars sold in the U.S.
The Loan Programs Office was tasked by the Inflation Reduction Act with overseeing the distribution of roughly $400 billion in new loans.
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The new BlueOval SK plants are slated to create roughly 5,000 construction jobs and 7,500 operating jobs once the sites are up and running, according to the DOE.
Jigar Shah, the head of the DOE’s Loan Programs Office, told Reuters that the goal of the new loan "is to have people choose to put these supply chains here in the United States, not in other countries, and to do them faster and more confidently here."