S Korea's SK On, Ford to split US battery venture ownership

South Korea’s SK On and Ford Motor will end their US battery joint venture, SK On said on December 11.

SK On, a subsidiary of SK Innovation, and Ford invested US$11.4 billion in 2022 to build battery plants in the US.

Under the new agreement, a Ford subsidiary will fully own and operate the Kentucky battery plants, while SK On will take full ownership of the Tennessee facility.

Each company will manage its respective battery production sites independently going forward.

🔗 Source: Reuters

🧠 Food for thought

Implications, context, and why it matters.

Ford secures domestic battery supply while SK On gains operational freedom

Ford takes control of Kentucky’s 80+ gigawatt-hour battery capacity 1 2. That secures supply for the F-150 Lightning and E-Transit while trimming joint-venture complexity 1 2. EV losses hit $5.1 billion last year, so Ford seeks steadier costs as it pushes next-gen electric F-Series to mid-2028 3.
SK On gets the Tennessee plant 3 2. Ford is shifting to lower-cost lithium iron phosphate batteries in Michigan using Contemporary Amperex Technology Co. Limited (CATL) technology 3 2. The Tennessee timeline moved to 2027 as EV growth cooled, and Kentucky headcount fell to 1,450 from 2,500 2 3.
In May both sides pursued outside customers for surplus output, including Japanese automaker Nissan using Kentucky capacity, and the breakup makes that approach official 3.

Battery equipment and materials suppliers can target SK On’s newly independent Tennessee site

Procurement now runs separately, so SK On will rebuild supplier ties for Tennessee without Ford’s filters.
Materials makers focused on nickel manganese cobalt components should go straight to SK On, which has a lithium offtake memorandum of understanding with ExxonMobil for U.S. supply 4. Parent links through SK Ecoplant Americas, the North American arm of SK Group’s environmental engineering and clean energy unit, create more paths for sustainable vendors 4.
Construction and facility management firms can pursue near-term work as the Tennessee buildout moves toward 2027 2. SK On’s carbon-cutting technology focus, showcased at the Consumer Electronics Show 2024, adds demand signals for energy and sustainability offerings 4.