The United States government is demonstrating its commitment to boosting electric vehicle (EV) production within its borders rather than relying on foreign entities. The US Department of Energy’s Loan Program Office (LPO) has recently announced a conditional $9.2 billion loan for BlueOval SK (BOSK), a joint venture between Ford and South Korean battery producer SK On. This loan will be used to build three battery manufacturing plants, marking the largest loan ever granted by the LPO and reflecting the government’s determination to prioritize domestic EV production.
The loan’s substantial size is in part due to the passage of the Inflation Reduction Act last year, which increased the LPO’s lending budget to $400 billion. In comparison, the LPO has distributed approximately $33 billion over the previous 14 years. This significant boost in capital will be essential in achieving the bold goal set by the Biden-Harris administration to have EVs account for half of all US car sales by 2030.
The three battery manufacturing plants will be located in Kentucky and Tennessee, with their primary purpose being the production of batteries for Ford and Lincoln’s upcoming EV models. This move aligns with Ford’s broader strategy, as the company aims to introduce two million EVs by 2026. Ford has already released EV models such as the All-Electric Explorer, Mustang Mach-E, and E-Transit, with a future EV lineup planned for Lincoln. In 2022, Ford produced approximately 132,000 EVs, highlighting the company’s ambition to considerably ramp up its EV manufacturing.
In addition to these battery plants, Ford has also announced plans for a Michigan-based LFP (Lithium Iron Phosphate) battery plant earlier this year. Ford’s commitment to expanding its battery production capabilities further strengthens its EV ambitions and the US government’s push for a more substantial domestic EV industry.
Related Post
Alongside the boost in manufacturing, Ford has made significant strides in providing convenience for EV drivers. The company recently secured access to 12,000 Tesla Superchargers across North America for its EV drivers. This partnership will improve the charging infrastructure available to Ford’s EV customers, facilitating their access to a broader network of charging points.
The loan provided by the LPO will not only boost EV manufacturing but also create substantial career opportunities. The construction of these battery plants will generate around 5,000 job opportunities, and once operational, an additional 7,500 jobs will be created. This investment emphasizes the government’s commitment to President Biden’s Justice40 Initiative, which aims to ensure that 40 percent of specific federal investments, including LPO loans, benefit disadvantaged communities.
By supporting the domestic EV industry, the government aims to bolster the US economy, promote sustainability, and reduce dependence on imports of EV components. Investing in domestic battery manufacturing plants will not only lead to increased EV production but also strengthen the country’s position in the global EV market. The loan provided to BOSK is a significant step towards achieving these objectives and reinforces the US government’s determination to secure a prominent role in the EV industry.
In conclusion, the US government’s commitment to domestic EV production is reaffirmed through the $9.2 billion loan provided by the LPO to BlueOval SK. With the construction of three battery manufacturing plants, this loan will support Ford and Lincoln’s EV production efforts and contribute to the Biden-Harris administration’s goal of making EVs account for half of US car sales by 2030. Moreover, this investment will create thousands of job opportunities and aligns with the government’s initiative to direct federal investments towards disadvantaged communities. The loan signifies the US government’s dedication to strengthening the domestic EV industry and reducing reliance on foreign entities.
