EV Car
EV Car

US Government Supports Domestic EV Car with $9.2 Billion Loan

What To Know

  • The loan provided by the LPO to BlueOval SK (BOSK) is the largest loan the agency has granted thus far, amounting to nearly four times the size of last year’s $2.
  • This increased funding will play a crucial role in achieving the ambitious goal set by the Biden-Harris administration to have electric vehicles account for 50% of US car sales by 2030.
  • The company has already made EV car models like the All-Electric Explorer, Mustang Mach-E, and E-Transit available, and there are plans to develop an electric lineup for Lincoln as well.
  • In addition to the manufacturing and production benefits, the loan provided by the LPO will bring significant career opportunities to the regions.

The US government has recently restated its dedication to shifting EV car production to domestic soil rather than depending on foreign companies. The Loan Program Office (LPO) of the US Department of Energy has disclosed its conditional approval of a $9.2 billion loan for BlueOval SK (BOSK), a joint venture between Ford and South Korean battery manufacturer SK Innovation. The loan will support the construction of three battery manufacturing facilities, as reported by Bloomberg.

The loan provided by the LPO to BlueOval SK (BOSK) is the largest loan the agency has granted thus far, amounting to nearly four times the size of last year’s $2.5 billion loan to Ultium Cell.

A joint venture between General Motors and LG. The loan’s substantial size is a result of the Inflation Reduction Act passed last year, which increased the LPO’s lending budget to $400 billion.

US Government Approves $9.2 Billion Loan for Ford-SK Innovation Joint Venture in EV Car Battery Manufacturing

To put it into perspective, over the previous 14 years, the LPO had distributed approximately $33 billion. This increased funding will play a crucial role in achieving the ambitious goal set by the Biden-Harris administration to have electric vehicles account for 50% of US car sales by 2030.

The three battery manufacturing plants funded by the LPO loan will be located in Kentucky and Tennessee. These plants will be responsible for producing batteries for Ford and Lincoln’s upcoming EV Cars.

In addition to these plants, Ford has also announced plans for an LFP (Lithium Iron Phosphate) battery plant in Michigan earlier this year. These production expansions align with Ford’s goal to introduce two million electric vehicles by 2026.

The company has already made EV car models like the All-Electric Explorer, Mustang Mach-E, and E-Transit available, and there are plans to develop an electric lineup for Lincoln as well. In comparison, Ford produced around 132,000 EV Cars in 2022.

Furthermore, Ford has recently secured access to Tesla’s charging points across North America, providing additional charging infrastructure for its electric vehicle drivers.

In addition to the manufacturing and production benefits, the loan provided by the LPO will bring significant career opportunities to the regions. It is expected to create around 5,000 construction jobs during the plant-building phase and an additional 7,500 operational jobs once the plants are up and running.

This investment aligns with President Biden’s Justice40 Initiative, which aims to ensure that 40 percent of specific federal investments, including LPO loans, are directed towards benefiting disadvantaged communities.

By promoting job creation and economic growth in these communities, the initiative seeks to address historic inequities and provide opportunities for underprivileged populations.

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