Ford is working with the state of Kentucky to find a buyer for an unused electric vehicle battery plant following the dissolution of its BlueOval SK joint venture with SK On.
In December, Ford and SK On announced plans to dissolve the joint venture they formed in 2022, a decision expected to cost both companies billions. Under the agreement, SK On will take control of the joint venture’s Tennessee facility, while Ford is repurposing another plant in Kentucky to produce battery energy storage solutions using lithium-iron phosphate batteries. Those batteries will be manufactured and sold through a new subsidiary called Ford Energy.
Ford Energy will use only one of the two plants built at the former BlueOval SK Battery Park in Kentucky, leaving the second plant without a defined purpose. As a result, Ford is now working with the state to identify a suitable buyer for that facility, according to the Courier-Journal. Jeff Noel, secretary of the Kentucky Cabinet for Economic Development, said the Hardin County plant will be marketed for new economic development opportunities.
The BlueOval SK Battery Park was originally designed to operate two plants, known as Kentucky 1 and Kentucky 2. However, as demand for electric vehicles declined, the joint venture delayed plans to activate Kentucky 2. The site spans roughly 600 acres and includes about 4.25 million square feet of space. State officials say the size of the facility gives Kentucky an opportunity to attract new investment and create jobs.
Noel also said Ford will take full responsibility for a $250 million forgivable loan previously awarded to BlueOval SK by the state. The loan required the company to meet specific investment, hiring, and wage benchmarks over a 10-year period. Repayments were originally scheduled to begin in March 2027. If Ford does not secure a new investor for the Kentucky 2 facility, the company could be required to begin repayments sooner, potentially on an accelerated timeline.
“There will be repayment,” Noel said. “There is no argument and there is no question about the messaging we have provided. You shall repay to the state $250 million.”
In a prior statement, Ford said the incentive obligations are expected to be assumed by the Ford subsidiary that will own and operate the plant. The company added that it does not anticipate changes to the agreement.
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