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BlueOval SK secures $9.2 billion policy funds in US

Posted June. 24, 2023 07:52,   

Updated June. 24, 2023 07:52


BlueOval SK, a battery production joint venture between SK On and Ford Motor Company of the United States, has provisionally secured a policy support fund of up to 9.2 billion U.S. dollars from the U.S. Department of Energy.

SK On announced on Thursday that BlueOval SK has received conditional approval for a policy fund loan worth 9.2 billion dollars under the Advanced Technology Vehicle Manufacturing (ATVM) program of the Ministry of Energy. The contract is expected to be concluded within the year at the earliest. ATVM is a program created in accordance with the U.S. Energy Independence and Security Act of 2007, and this is the largest-ever financial support for the battery sector, SK On said. Earlier, Ultium Cells, a joint venture between LG Energy Solutions and General Motors (GM), secured an ATVM loan of 2.5 billion dollars. The borrowing rate of the ATVM program will be applied at the level of the U.S. Treasury rate. At the time of the contract signing, borrowing at a low-interest rate equal to the 10-year U.S. Treasury bond rate will be feasible.

BlueOval SK plans to use the funds to build a total of three factories, including factories 1 and 2 in Kentucky and a factory in Tennessee. Aiming for commercial operation sequentially from 2025, these plants will have a total production capacity of over 120 GWh. It is a scale that can produce about 1.2 million units of electric vehicles that require 105KWh batteries per unit annually.

Do-Young Kwak now@donga.com