Ford EV battery joint venture exit triggers USD 6 billion earnings impact

Ford has disclosed that the total financial impact of the Ford EV battery joint venture exit with SK On will amount to USD 6 billion, creating a multi-year drag on earnings before interest and tax. The dissolution of the partnership was confirmed in December 2025 and reflects a major reset in the company’s battery manufacturing strategy.

Financial impact of ending the BlueOval SK partnership

The first USD 3 billion impairment related to the Ford EV battery joint venture exit will be recognized in Ford’s 2025 earnings. The remaining USD 3 billion will be spread across 2026 and 2027, softening the immediate hit but extending the financial impact over several reporting periods.

Asset write-downs and balance sheet effects

The termination of the BlueOval SK joint venture resulted in asset losses of KRW 3.7 trillion, or USD 2.6 billion, for SK Innovation. While this charge is recorded as a one-time loss for SK Innovation, Ford will assume both the assets and liabilities tied to the Kentucky operations.
As part of the transition, the move eliminates KRW 5.4 trillion, equivalent to USD 3.8 billion, in debt from SK Innovation’s balance sheet. This transfer significantly reshapes financial exposure for both partners following the joint venture’s dissolution.

Kentucky plant closure and workforce impact

Ford confirmed that the BlueOval SK Battery Park facility in Kentucky will close on February 14. All 1,512 employees at the site will be laid off at that time or shortly thereafter, marking a substantial workforce reduction tied directly to the Ford EV battery joint venture exit.

Retooling for LFP battery production

Following the closure, Ford plans to invest USD 2 billion to retool the Kentucky facility. The upgraded plant will manufacture lithium-iron phosphate batteries to support Ford Energy, the company’s newly established battery energy storage systems business based in Kentucky.

Future operations at the Tennessee site

SK On, the dedicated battery subsidiary of SK Innovation, will continue operating the former joint venture’s Tennessee facility. The site is scheduled to begin producing storage cells and battery packs for Ford’s extended-range electric vehicles starting in 2028.
This approach allows Ford to narrow its manufacturing focus while maintaining access to battery supply for future vehicle programs. At the same time, SK On preserves a long-term production role in North America despite the broader restructuring triggered by the Ford EV battery joint venture exit.