One of the biggest points separating electric cars from wide use is the lack of proper battery technology. That’s where a new joint venture between South Korean company SK On and legacy automaker titan Ford (NYSE:F) picked up a new loan in a bid to build more battery manufacturing plants. It was enough for Ford investors to put in their own investment, sending Ford up slightly in Thursday afternoon’s trading.
The loan in question, valued at up to $9.2 billion, will allow Ford and SK On to build three new battery manufacturing plants in both Kentucky and Tennessee, according to a Reuters report. The loan comes from the Advanced Technology Vehicles Manufacturing loan program, and the batteries created therein will produce over 80 gigawatt-hours of battery annually. However, the loan is a conditional one, and neither Ford nor the Department of Energy would detail just what those conditions were.
Ford’s plans to get in on this kind of venture go back to 2021 when it previously announced plans to build battery manufacturing systems in these two states. Ford and SK On were already planning to put in $11.4 billion on the concept, which would have been the single largest investment that the company has made since its launch in 1903. Ford already took out one loan through this program back in 2009 but finished paying back said loan last year, noted a CNN Business report.
Analyst support for Ford, meanwhile, is a bit thin. Ford stock is considered a Moderate Buy right now, with seven Buy ratings, four Holds, and one Sell comprising the mix. Further, Ford stock offers investors 9.42% upside potential thanks to its average price target of $15.56 per share.
