SAN FRANCISCO (Reuters) – Ford Motor’s joint venture partner for battery development, Korea’s SK Innovation, believes that there will be a shortfall in U.S. battery supplies until 2025, due to long lead times involved with building production facilities. This is according to top SK executives who spoke to Reuters.

SK Innovation’s battery company, SK On is looking at developing lithium iron phosphate (LFP) batteries. These have a cost- and thermal stability advantage despite a shorter driving range. Kim Jun, chief executive officer of SK Innovation, Jee Dong–seob, CEO, SK On said.

The Biden administration faces a problem with tight supplies of battery batteries, which are key components for electric cars. It aims to increase EV production as well as reduce dependence on imported materials, components, and battery cells.

The current U.S. batteries capacity cannot meet the demand. Kim spoke about the lead times required for building a factory that can meet demand. He said that he sees a shortage of battery cells continuing until at least 2025. Kim was referring to how long it would take to provide battery cells in America, as well as time to test products and select a site.

He said that China will likely have an oversupply of batteries, while Europe’s supply should be sufficient to meet demand.

Ford and SK On will invest $4.45 Billion each in three factories in America. Production is expected to start in 2025.

SK stated that the plant deal, which is the largest in America, will allow it to have an industry-leading backlog of 1,600 gigawatts. This would be enough power for 27 million vehicles.

SK Innovation merged its battery business with its fully-owned unit, SK On as of October 1.

Kim stated that Jim Farley was Ford Motor CEO and told him Ford’s future is in his hands.

His belief was that there were very few chances for automakers to succeed building cell cells on their own without the help of experienced cell producers who know how mass production works.

It is not easy to manufacture cells. Kim explained that it requires lots of trial-and-error.

Two executives from SK said that SK was considering LFP battery development for certain applications, such as low-priced cars.

Jee from SK On said that there is interest in LFP technology among automakers.

Ford and Volkswagen (DE) have begun to diversify into LFP technology. It is the majorstay of Chinese battery producers, following Tesla (NASDAQ)’s example.

After a string of car fires involving Nickel-based nickel-based batteries used in GM Bolt cars, the LFP battery, which is lower in price, has been gaining more attention.

SK plans to create high-nickel pouch batteries with Ford in its joint venture.

Jee anticipates that the U.S. market for electric cars will see a rapid growth rate, driven by increased competition from major players such as Hyundai, Ford, and Volkswagen.