BlueOval SK, the joint venture of Ford and SK On, has been offered a $9.2 billion loan by the US Department of Energy on Thursday – the largest in the history of its Loan Programs Office, Kallanish reports.

The offer was made through a conditional commitment for loan. This is the equivalent to a term sheet that has been fully approved by the DOE and its partners including the US Office of Management and Budget, sometimes even the Treasury Department. The deal is subject to the project reaching “critical milestones and certain conditions,” says Jigar Shah, director of the Loan Programs Office.

The financing support will unlock over 120 gigawatt-hours of annual battery cell production capacity and create up to 12,500 jobs when the three gigafactories are up and running, the office says. The plants -- one in Tennessee and two in Kentucky -- will supply batteries for future Ford and Lincoln electric vehicles.

“This effort supports President Biden’s Investing in America agenda to onshore and re-shore domestic manufacturing of technologies that are critical to reaching the clean energy and transportation future,” adds Shah.

The office notes that expanding domestic production of American-made batteries is critical to reaching the government’s goal to have EVs represent at least 50% of all new car sales in the US by 2030.

Ford welcomed the support for BlueOval SK’s EV battery production, in an emailed statement to Kallanish.

“It’s going to help make great EVs available to more customers while powering thousands of good-paying jobs and American manufacturing,” says Ford treasurer Dave Webb. “Major technology transitions have always been accelerated by collaboration between the public and private sectors. The DOE’s foresight here will help do the same for the transition to zero-emissions transportation.”

The lending commitment was made under the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program.