SK On is unwinding its US battery joint venture with Ford Motor Co., ending a three-year partnership as it accelerates its move toward fully independent production in the North American market.
The Korean battery-maker said Thursday that SK On and Ford will separately own and operate the three BlueOval SK battery plants that had been jointly established. Under the restructuring, SK On will take full ownership of the Tennessee plant currently under construction, while Ford, through a subsidiary, will take over the two Kentucky factories — one of which began operations in August, with the other still being built.
The companies aim to finalize the agreement by the end of the first quarter of 2026, pending regulatory approvals and other closing conditions.
Once the Tennessee facility is transferred, it will become SK On’s second wholly owned US plant, alongside SK Battery America in Commerce, Georgia. The shift will leave SK On with only one US joint venture, its project with Hyundai Motor Group in Bartow County, Georgia. SK On said the restructuring will expand its standalone production capacity in the US from 22 gigawatt-hours to 67 gigawatt-hours annually.
Calling the move a strategic decision to streamline operations, SK On said, “With our 45-gigawatt-hour Tennessee plant, we aim to supply batteries for both electric vehicles and energy storage systems not only to Ford but to a wider range of customers, strengthening profitability and operational resilience in the North American market.”
SK On already supplies Hyundai Motor Group and Volkswagen. This year it also secured new long-term contracts with Nissan and US EV startup Slate. The company also signaled it may produce ESS batteries at the Tennessee plant to meet fast-growing demand for grid stabilization solutions. In September, SK On received its first major US ESS order from Flatiron Energy Development to supply lithium iron phosphate cells.
The company said the restructuring will improve its financial stability by reducing debt and fixed costs associated with the Kentucky facilities, while allowing it to concentrate volume and efficiency gains at the Tennessee site.
Industry officials say the split may ultimately work in SK On’s favor. Ford has slowed elements of its electrification road map, delaying several next-generation battery models and adjusting production plans. BlueOval originally projected that both the Kentucky and Tennessee plants would begin operations in 2025, but only the first Kentucky site has come online.
“Ford has steadily scaled back its EV rollout and is showing increased interest in internalizing battery technologies,” an industry source said. “For SK On, the separation provides flexibility to direct capacity toward clearer demand — whether EV or ESS.”
Despite dissolving the joint venture, SK On stressed that its relationship with Ford will continue. The Tennessee plant sits within Ford’s BlueOval City campus, and SK On said it will keep supplying batteries for Ford’s next-generation EVs under existing agreements.
hyejin2@heraldcorp.com
