The US government finalised on Monday a direct loan agreement of up to $9.63 billion to BlueOval SK (BOSK), the joint venture between Ford and South Korea’s SK On, Kallanish reports.

The funds pave the way for the construction of up to three battery gigafactories in the US, with a combined capacity of 120 gigawatt-hours. The plants, one in Stanton, Tennessee and two in Glendale, Kentucky, will supply batteries to future Ford and Lincoln EVs. First productions are planned for 2025.

As part of terms and conditions, the JV is required to develop and implement a comprehensive community benefits plan (CBP). It will build new community and technical colleges that are training members of the community for “quality jobs” at the JV facilities. According to the Department of Energy (DOE), the projects will create 5,000 construction jobs and 7,500 operational jobs.

“Today’s announcement reinforces President Biden’s historic efforts to onshore and re-shore domestic manufacturing and ensure American businesses remain global leaders in technologies of the future,” the DOE says. “Expanding domestic production of American-made batteries is critical to reducing America’s reliance on adversarial foreign nations like China.”

Additionally, the move contributes to meeting the US’ climate commitments and achieving Biden’s goal to make half of new vehicles sold in 2030 zero-emission vehicles, it notes.

The loan is the largest granted through DOE’s Advanced Technology Vehicles Manufacturing Program (ATVM) to date. Authorities had announced a conditional commitment for a loan of up to $9.2 billion to BlueOval SK in June 2023.