SK Innovation has become Ford's strategic battery supplier in the U.S. and a key partner in the recently announced massive $11.4 billion invetments in Tennessee and Kentucky.
With SK Innovation's two battery plants in Commerce, Georgia (the first will start production in early 2022, while the second one in 2023), and three additional plants (to be built in Tennessee and Kentucky), the South Korean manufacturer will have a total production capacity of over 150 GWh of battery cells per year around 2025.
If no one will come forward with bigger investments (we guess that there will be some, including Tesla, LG Chem's LG Energy Solution or Panasonic to name just a few), SK Innovation would "become the largest battery maker in the U.S."
The twin battery plants in Kentucky (2x 43 GWh/year) might be also the largest battery production plant ever in the country.
SK Innovation invests billions in the expansion into the U.S. market with $4.45 billion in the BlueOvalSK joint venture with Ford (50/50) and $2.6 billion in its own plants in Georgia.
According to the press release, the company will invest up to $6.4 billion in the BlueOvalSK, which indicates that there is $2 billion more ($4 billion, including Ford's part) to be spent on another - not announced yet - project. It could be another gigafactory in the U.S. or in Europe.
"Right after the Board of Directors’ meeting on September 27th (KST), SK Innovation revealed its plan to invest up to USD 6.4 billion in the BlueOvalSK battery plant by 2027 in the form of providing the capital to its US battery corporation SK Battery America (SKBA).
SK Innovation announced that it would invest USD 4.45 billion in the construction these BlueOvalSK’s plants. This amount is equivalent to its 50% stake in the joint venture. The decision was made after a meeting held by the company’s Board of Directors on September 27th (KST)."
SK Innovation's plan is to install more than 200 GWh of battery manufacturing capacity by 2025 and more than 500 GWh by 2030.
Let's take a look at the details.
SK Battery America (SKBA)
The SK Battery America (SKBA) subsidiary of SK Innovation is building two battery plants at a single site in Commerce, Georgia. The first should start series production in early 2022.
They are contracted to produce lithium-ion cells for the Ford F-150 Lightning as well as for Volkswagen ID.4.
SK Battery America (SKBA) in brief:
- Plant 1: 9.8 GWh - early 2022
P1: 9.8 GWh battery plant in Commerce, Georgia (expected online in Q1 2022). Update from September 2020.
- Plant 2: 11.7 GWh scheduled for 2023
P2: 11.7 GWh battery plant in Commerce, Georgia (expected online in Q1 2023)
- Total: 21.5 GWh
investment: 3 trillion KRW ($2.6 billion)
The BlueOvalSK joint venture with Ford will consist of three 43 GWh battery plants - one at the Ford's Blue Oval City in Stanton, west Tennessee, and two (twin) plants at BlueOvalSK Battery Park in Glendale, central Kentucky.
BlueOvalSK joint venture with Ford (50/50) - 129 GWh, starting from 2025
- Battery plant at the Blue Oval City: 43 GWh - 2025
Stanton, west Tennessee
investment: probably around $2.9 billion ($5.6 billion total in the Blue Oval City)
43 GWh plant
- BlueOvalSK Battery Park: 86 GWh - 2025
Glendale, central Kentucky
investment: $5.8 billion
a 1,500-acre campus
two 43 GWh plants (total of 86 GWh annually)
- Total: 129 GWh
BlueOvalSK in brief:
- joint venture between Ford and SK Innovation (50/50)
- MoU announced on May 20, 2021
- investment: initially announced about 6 trillion KRW ($5.3 billion)
on September 27, 2021 increased to $5.8 billion (two plants in Kentucky) plus a plant in Tennessee (probably another $2.9 billion) - probably $8.7-$8.8 billion total
- production output: initially announced about 60 GWh of battery cells and modules annually
(with potential to expand)
on September 27, 2021 increased to 129 GWh annually (three 43 GWh plants)
- cell chemistry: probably “Nickel 9” (NCM battery that has 90% nickel content in cathode) as in SK's battery plants in Commerce, Georgia
- expected production start: 2025
- location: one plant in Tennessee and two in Kentucky (each 43 GWh annually)
- potential to expand into Europe