Sila secures $1.4 billion Pentagon loan to expand US battery output

Sila, the only advanced battery materials company with gigawatt-scale manufacturing in North America, received a conditional loan commitment of up to $1.4 billion from the US Department of Defense to expand silicon-carbon anode and lithium-ion battery cell production.

"We solved the hardest problem in battery materials with the invention of the modern silicon anode. But invention is only the first step — manufacturing it at gigascale, here in America, proves that technology sovereignty is possible," Gene Berdichevsky, Sila co-founder and CEO, said.

The financing, issued through the Pentagon's Office of Strategic Capital, would expand Sila's silicon-carbon anode facility in Moses Lake, Washington, and fund construction of a battery cell plant for specialty applications including industrial, agricultural, and military drones. The commitment follows a $300 million equity round led by Sutter Hill Ventures and Atreides Management last month. China controls over 90 percent of anode material processing and over 80 percent of global battery cell production, leaving American manufacturers of critical defense technology exposed to a single point of failure.

The loan is part of a broader Pentagon push to secure critical materials. In fiscal year 2026, the Office of Strategic Capital has committed over $8.4 billion in debt financing and mobilized more than $17.8 billion in total public and private capital for the American industrial base. Demand for batteries outside China is projected to triple over the next five years, and Sila remains the only advanced battery technology company in North America with GWh-scale operations.

China's Grip on Battery Supply Chains

The strategic rationale is stark. A trade dispute, export restriction, or supply disruption from China would stall production across multiple critical technologies at once — from drones to autonomous systems to satellite operations. The Pentagon's Advanced Battery Strategy identifies battery materials as a priority for the defense industrial base, and the OSC loan is designed to accelerate domestic manufacturing capacity.

"This commitment has the potential to transform the domestic battery supply chain," Asad Akram, managing director and co-head of critical minerals at OSC, said. "In doing so, it would provide crucial material for a variety of applications critical to the US warfighter as well as the US economy writ large."

The expansion of silicon-carbon anode and battery cell manufacturing would increase US production of advanced materials used in national-security applications, including satellite operations, unmanned aerial systems, and munitions that support combat operations, according to the Department of War.

Titan Silicon and the Moses Lake Expansion

Sila's silicon-carbon anode technology, branded Titan Silicon, launched in 2021 and drives performance across drones, satellites, electronics, robotics, AI, and electric vehicles. The loan would support a dramatic expansion of production capacity at the Moses Lake plant using Sila's modular manufacturing technology, designed to scale rapidly with demand.

The funding would also allow Sila to build out a silicon battery cell facility for specialty applications with rigorous performance requirements. The company's investors include 8VC, Bessemer Venture Partners, Coatue, In-Q-Tel, Matrix Partners, Sutter Hill Ventures, and funds advised by T. Rowe Price Associates.

"Securing our domestic supply chains is vital to building a lethal Arsenal of Freedom for the American warfighter," Emil Michael, under secretary of war for research and engineering, said. "President Trump, Secretary Hegseth, and Deputy Secretary Feinberg have made it abundantly clear that we require unabated access to critical materials right here at home."

The conditional loan commitment specifies customary additional steps Sila must take before financial close, including satisfying financial, legal, technical, and diligence requirements. The company must also navigate a competitive environment where Chinese battery giants including CATL and BYD dominate global cell production, while US-based rivals like Tesla's 4680 cell program and Panasonic's Nevada operations compete for domestic market share.

For investors, the loan reflects a structural shift in how the US government views battery technology — not just as a consumer electronics input but as a defense-critical material. The $1.4 billion commitment, combined with the $300 million equity round, gives Sila substantial capital to scale production at a time when the US battery supply chain remains heavily dependent on foreign sources.

This article is for informational purposes only and does not constitute investment advice.