Ford Motor Company and South Korean battery maker SK On have dissolved their BlueOval SK joint venture, a partnership that began in 2022 and was backed by an $11.4 billion investment. The split will see Ford assume full control of the Kentucky battery plant, where cell production began in 2025, while SK On will continue to operate the Tennessee facility under its own name.
The decision follows a broader shift in the electric‑vehicle (EV) battery market. Demand for U.S. EVs has slowed after the expiration of the $7,500 federal tax credit on September 30, 2025, and the Inflation Reduction Act’s incentives have become more selective. These policy changes have reduced the price advantage of high‑cost nickel‑cobalt‑manganese batteries, prompting Ford to focus on cheaper lithium‑iron‑phosphate (LFP) chemistry for mass‑market models.
SK On’s financial performance has also pressured the partnership. The company reported an operating loss of 124.8 billion won ($84.7 million) for the July‑September 2025 quarter, nearly double the 66.4 billion won loss in the prior quarter. The loss reflects a sharp decline in EV battery shipments and a strategic decision to shift resources toward the growing energy‑storage‑system (ESS) market, which serves data centers and grid‑stabilization projects.
Ford’s rationale centers on consolidating battery production under its own control to streamline the EV supply chain and reduce capital commitments. By owning the Kentucky plant outright, Ford can accelerate its LFP battery rollout and better align production with its electrification roadmap, while still maintaining a partnership with SK On for the Tennessee plant to support future ESS projects.
The joint venture’s dissolution signals a broader industry trend: automakers and battery makers are re‑evaluating large‑scale U.S. battery projects in light of policy shifts and market headwinds. SK On’s pivot to ESS and Ford’s focus on LFP chemistry illustrate how companies are adapting to a more competitive and subsidy‑sensitive environment, potentially reshaping the U.S. battery landscape over the next few years.
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