Ford gets $9B Federal loan for EV battery plants

Ford Motor Co.’s $11 billion electric vehicle efforts in Kentucky and Tennessee were boosted Thursday by a $9.2 billion Federal loan.

The loan will come through the U.S. Department of Energy’s loan programs office. The loan programs office funds projects in line with the government’s energy goals. The office says its mission is “building a bridge to bankability.”

The loan programs office is not a jobs program. The three facilities funded will create only 5,000 temporary construction jobs and 7,500 jobs in operations. The loan is about funding a green energy project, on the premise that it will reduce the use of gasoline.

From the U.S. Department of Energy’s press release:

Together, the plants, one located in Tennessee and two in Kentucky, will enable more than 120 gigawatt hours of U.S. battery production annually and 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 constructions jobs in Tennessee and Kentucky, and 7,500 operations jobs once the plants are up and running.

The facilities are a joint venture between Ford and SK ON, a South Korea-based EV battery manufacturer.

Ford got a similar loan in September 2009 for $5.9 billion, “to upgrade 13 facilities in Illinois, Kentucky, Michigan, Missouri, New York, and Ohio,” the Department of Energy said.

“The resulting state-of-the-art assembly and manufacturing plants have the enhanced flexibility of producing multiple-platform, fuel-efficient advanced technology vehicles in response to changing market demands and fuel efficiency standards,” the department added.

Ford repaid the loan in June 2022. The government said the loan benefited the climate by saving 268 million gallons of gasoline each year.

“Several steps remain for the project to reach critical milestones,” the department said of the current loan, “and certain conditions must be satisfied before DOE issues a final loan.”

Gov. Gretchen Whitmer believes Michigan should build the infrastructure for two million EVs by 2030. Michigan had 17,500 EVs in 2021.