Ford Motor Co. and South Korean battery manufacturer SK On Co. this week officially established a joint venture to operate U.S. electric-vehicle battery plants together, a move announced last year.
For, SK On and an SK On subsidiary called SK Battery America, Inc. on Wednesday closed on the formation of BlueOvalSK, LLC, a JV that will build and operate one EV battery plant in Tennessee and two in Kentucky, according to a regulatory filing. The JV will supply EV batteries to Ford "and its affiliates."
Ford and SK Battery America hold equal ownership stakes in the JV, which will be a consolidated subsidiary of SK On.
Ford agreed to contribute up to $6.6 billion in capital to the JV over a five-year period ending in 2026, per the filing.
In May 2021, Ford and SK announced they had signed a memorandum of understanding to establish a JV to build batteries.
Then in September, the companies unveiled plans to invest $11.4 billion and create 11,000 jobs to build EVs and batteries at new campuses in Tennessee and Kentucky.
BlueOvalSK is slated to produce 60 gigawatt hours annually in traction battery cells and array modules in North America, starting mid-decade, with the potential to expand, the companies have said.
A major question looming over the establishment of the JV and its battery plants — as well as other JVs between automakers and battery manufacturers now forming in the U.S. — is whether workers there will be represented by the United Auto Workers. Organizing workers at EV and battery plants has emerged as a top priority for the Detroit-based union.
The formal creation of Ford and SK's JV comes as automakers in the U.S. increasingly look to localize, and in some cases bring in-house, production of key EV components as the industry moves further down the path of electrification.
Ford is investing $50 billion in electrification through 2026, by which time it's targeting annual EV production capacity of 2 million units globally.
