Topline
A $9.2 billion loan to Ford’s electric vehicle division will go toward three battery manufacturing plants in the U.S., the Department of Energy announced Thursday, marking one of the largest grants to an automaker in recent history, which could help fuel Ford’s plan to manufacture 2 million electric vehicles by 2026.
The Mustang Mach-E is one of Ford’s electric vehicles.
Key Facts
The loan, given to BlueOval SK, Ford’s $11 billion joint venture with South Korean battery maker SK On, marks the largest payment to a U.S. automaker since the 2009 financial crisis, according to Bloomberg.
The funds will go toward three manufacturing plants to produce batteries for Ford and Lincoln electric vehicles—the factories are already under construction, with one in Tennessee and two in Kentucky.
Ford upped its electric vehicle spending by $20 billion last year, announcing it planned to push its electric vehicle production to make up half of its total volume by 2030, with 2 million Ford EVs planned for 2026—compared with the roughly 132,000 it produced in 2022.
Key Background
The Department of Energy’s loan is part of President Biden’s effort to bring in more domestic manufacturing to boost the country’s competitiveness with China, especially in the sustainable technology industry. The lending comes hand-in-hand with the Inflation Reduction Act, passed in August 2022, which allotted $370 billion for clean-energy projects, as well as consumer tax credits for electric vehicle buyers that offer tax rebates up to $7,500 per vehicle.
Big Number
$465 million. That’s how much the government gave Tesla for its first factory in 2010 under the Obama administration. Ford is the closest competitor behind Tesla for electric vehicle manufacturing in the U.S. as it ranks second for electric vehicle sales behind Tesla. These numbers were led by Ford’s Mustang Mach-E model, which was the third best-selling U.S. EV in 2022.
Further Reading
Best EV Stocks (Forbes)
Ford Rises On Plan To Carve Out ‘Model e’ Electric Vehicle Business (Forbes)
Electric Vehicles Sales Are Up 41% – EDTA And Ford Explain Why (Forbes)
Inflation Reduction Act Benefits: Electric Vehicle Tax Incentives For Consumers And U.S. Automakers (Forbes)
Source: https://www.forbes.com/sites/katherinehamilton/2023/06/22/ford-gets-92-billion-loan-to-expand-electric-vehicle-manufacturing/