KY lands its largest economic development project: 5,000 jobs and $5.8B investment

Kentucky has landed the single largest economic development project in its history, a $5.8 billion investment by Ford Motor Corp. and South Korea-based SK Innovation to build two battery manufacturing plants in Glendale in Hardin County that are expected to employ 5,000 people.

The announcement Monday puts Kentucky at the forefront of the automotive industry’s future with electric vehicles, said an elated Gov. Andy Beshear.

The project, said Beshear, “will transform our economy, creating a better Kentucky with more opportunities for our families for generations. Our economy is on fire —and now, it’s electric. Never again will we be thought of as a flyover state. Our time is now. Our future is now.”

Beshear said the $5.8 billion investment is more than triple the previous largest single investment announced in Kentucky and that the jobs created will double the number of any previous announcement in the state. The first plant is expected to open in 2025 and the second would follow in 2026.

The 5,000 announced jobs are full-time jobs at the plants and do not include construction, supplier or dealership jobs.

The new battery plants in Glendale are part of an $11.4 billion investment by Ford and SK Innovation to create 11,000 jobs in Kentucky and Tennessee.

Their project includes a new 3,600-acre campus outside of Memphis, Tenn., that will employ 6,000. Called Blue Oval City, the complex will be constructed on a nearly 6-square-mile site in west Tennessee and build next-generation electric F-Series pickups and advanced batteries.

“Ford is very excited to make this historic investment in the great state of Kentucky,” said Lisa Drake, Ford North America chief operating officer. “Kentucky has been an incredible partner to Ford for more than 100 years and is home to Louisville Assembly Plant and Kentucky Truck Plant. With this announcement, Kentucky will play an essential role as Ford fulfills its commitment to lead the electric vehicle revolution and create thousands of jobs in the commonwealth, and we look forward to working with Kentuckians to create the future together.”

Beshear, Ford Executive Chair Bill Ford, Chief Executive Officer Jim Farley and Dong-Seob Jee, president of SK Innovation’s battery business, will join Kentucky leaders to unveil more about the project at 4:30 p.m. EDT Tuesday at the Kentucky State Capitol.

The Democratic governor successfully guided legislation in a special law-making session this month that allows the state to spend more than $410 million on incentives to attract economic development projects with investments of more than $2 billion.

Incentives offered

In a telephone interview Monday afternoon, Beshear said Kentucky is offering three major incentives for the project.

One is a performance-based, forgivable loan of up to $250 million. Ford and SK Innovations will not have to repay the loan if the promised investments are made and the jobs are created, said Beshear. “It is performance-based and reasonable and fair to all,” he said.

Another is conveyance of the 1,551-acre property off I-65 in Glendale to the joint venture. It is to be known as the BlueOvalSK Battery Park.

“This is a site that the legislature and the local industrial authority there had incredible foresight to buy,” he said.

The third incentive, Beshear said, is job training worth up to $36 million through the Kentucky Community and Technical College System and the Bluegrass State Skills Corp.

Beshear also noted that the state’s road plan already contemplates working on an interchange near the site. The current State Highway Plan provides for $33 million, beginning in 2022, for improvement of the I-65/KY 222 interchange at Glendale.

The governor said “numbers aren’t final” for how much the average employee will be paid.

John Savona, Ford’s vice president for manufacturing and labor affairs, said employees at the new plants will have a choice of whether to organize with a labor union.

The passage of legislation this year to provide incentives for mega projects was instrumental and was supported by Republican and Democratic leaders, the governor said.

“We continue to pursue at least four other projects that meet that $2 billion threshold,” he said, declining to identify them.

He quickly added that the state already is hearing from suppliers who want to locate in Kentucky to supply the new battery plants.

“Ford looked at a lot of different things, but mainly the site, workforce and to have the confidence in an administration to be sure we could get it done,” said Beshear.

Production slated to begin in 2025

At a virtual news conference Monday, Ford told reporters that the Kentucky site will supply Ford’s North America assembly plants with batteries that will power the next generation of Ford and Lincoln electric vehicles. Production of advanced lithium-ion batteries is projected to begin in 2025.

Ford expects at least 40 percent of its global sales to be electric vehicles by 2030.

The Kentucky plants are expected to manufacture enough batteries to generate 86 gigawatt hours of power annually, which state officials believe will make Kentucky the nation’s largest producer of electric automotive batteries.

The project builds on the more than century-long partnership between Kentucky and Ford.

Kentucky workers rolled a Model T off a Ford assembly line in Louisville in 1913. The Louisville Assembly Plant and Kentucky Truck Plant in Louisville employ about 13,000 workers, with thousands more working for suppliers and dealerships.

Kentucky workers assemble the Ford Escape and Lincoln Corsair at the Louisville Assembly Plant, which opened in 1955, and they assemble Ford Super Duty Trucks, the Ford Expedition and the Lincoln Navigator at the Kentucky Truck Plant, which opened in 1969.

Ford’s $7 billion portion of the $11.4 billion investment for the Tennessee and Kentucky sites is the largest manufacturing investment in the company’s 118-year history.

Ford Motor Co. is a global automotive company based in Dearborn, Mich. It employs about 182,000 people worldwide.

Established as South Korea’s first oil refining company in 1962, SK Innovation engages in diverse areas of business, including exploration and production, batteries, and information and electronics materials.