The Ford and SK On Breakup: Who Gets the Custody of the Batteries?
Corporate partnerships in the automotive world are a lot like Hollywood marriages: they start with massive fanfare, incredibly expensive gifts (in this case, factories), and declarations of eternal unity. But give it a few years, and the press releases start getting a little chilly. Today, we aren't seeing a divorce, exactly, but Ford and South Korean battery titan SK On are definitely moving into separate houses.
The two giants announced a major restructuring of their "BlueOval SK" joint venture today. The split of assets is clean but telling: Ford will assume full control and ownership of the massive battery plants in Kentucky, while SK On will take the reins of the facility in Tennessee. On paper, this looks like administrative housekeeping. In reality, it is a strategic pivot that reveals just how volatile and high-stakes the battery game has become.
Let’s unpack why this matters. When this JV was formed, the industry was in a different place. The mantra was "volume at all costs." Every automaker was scrambling to lock down gigawatt-hours, terrified of being left without batteries as the EV wave crashed over them. Forming a Joint Venture was the safest play—share the risk, share the capital, share the tech. But the market has cooled and matured. The exponential growth curve has flattened into a more jagged, unpredictable line.
By taking full control of the Kentucky plants, Ford is doubling down on vertical integration for its most critical products. Kentucky is truck country. Those batteries are likely destined for the next generation of electric F-Series trucks and large SUVs—vehicles where margins are fat, but battery costs can easily balloon out of control. If Ford owns the plant, they control the destiny. They can tweak chemistry, adjust output to match vehicle assembly speed precisely, and, crucially, capture every cent of the tax credits available under the Inflation Reduction Act (IRA). There is no "partner" to split the bounty with. It’s a move that screams "we know what we are doing now."
On the flip side, SK On taking Tennessee gives the battery maker freedom. Locked in a JV, a battery plant is generally beholden to its parent automaker. If Ford sales dip, the plant slows down. By owning the Tennessee facility outright, SK On can potentially pivot to supply other automakers. Maybe they sell to Volkswagen, or Hyundai, or even a commercial trucking startup. It turns SK On from a captive supplier into a merchant of energy, which is a much safer place to be when you’re investing billions in capital equipment.
This restructuring also hints at the labor undercurrents. The UAW has been aggressive about organizing battery plants, viewing them as the engine rooms of the future. Ford owning Kentucky outright simplifies that negotiation table. It’s just Ford and the Union, without a Korean partner in the middle wondering why labor costs in America are so complex.
For the car shopper, this is deep "inside baseball," but it has a ripple effect on the sticker price. The primary barrier to EV adoption right now is affordability. We need cheaper EVs, period. The only way to get cheaper EVs is to ruthlessly cut inefficiency out of the supply chain. Ford deciding to run its own battery shop suggests they think they can do it cheaper and better than the JV could. If they’re right, that $80,000 electric truck might eventually become a $60,000 electric truck.
Ultimately, this is a sign that the "Wild West" land-grab phase of the EV transition is ending. We are entering the phase of strategic consolidation. Automakers are looking at their massive bets, counting their chips, and realizing that sometimes, if you want something done right (and profitably), you really do have to do it yourself.
