Home Business Ford ‘pausing’ construction of Marshall EV battery plant

Ford ‘pausing’ construction of Marshall EV battery plant

by Stella Morgan

Ford Motor Company has announced the halt of construction on its $3.5 billion electric vehicle battery plant project in Marshall, Michigan. This decision comes as a surprise to many, especially considering the company’s previous commitment to investing in electric vehicles. Ford spokesperson T.R. Reid confirmed the pause in construction and stated that the company is limiting spending until they are confident in their ability to competitively run the plant.

While Reid did not explicitly mention the ongoing United Auto Workers’ (UAW) strike as a factor in this decision, it is hard to ignore the timing. President Joe Biden is set to visit Michigan to rally the striking UAW workers, and former President Donald Trump is also planning an event to appeal to auto workers whose jobs are perceived to be at stake in the transition to electric vehicles. The pause in construction could be seen as a cautious move by Ford to assess the impact of the strike and political developments on their business decisions.

The battery plant project, known as “Blue Oval Battery Park Michigan,” was expected to employ 2,500 people with pay ranging from $20 to $50 an hour. Ford had planned to license battery technology from China-based Contemporary Amperex Technology Co. Ltd. (CATL), the leading LFP battery maker in the world. However, CATL would not receive state tax incentives, which may have been a contributing factor to Ford’s decision.

In addition to the construction pause, Ford secured direct tax incentives and a property tax abatement for the project. The Michigan Department of Transportation also received funds for expanding roadways and freeway connections for the anticipated truck traffic associated with the battery plant. The Marshall Area Economic Development Alliance was responsible for site preparation of the farmland for the battery manufacturing park.

Despite the community pushback and concerns about the project, the Marshall battery plant was one of the cornerstone projects of Michigan’s incentive program, the Strategic Outreach and Attraction Reserve Fund. Some Republican congressional leaders even requested copies of the licensing agreement and communications between Ford, CATL, and the Biden administration.

The pause in construction raises questions about the future of the battery plant project. Ford has not made a final decision about the investment in Marshall, leaving open the possibility of resumed construction in the future. This development underscores the challenges and uncertainties that come with transitioning to electric vehicles and highlights the importance of stable labor relations and political support in such ventures.

As the story continues to unfold, it will be interesting to see how Ford navigates these challenges and the impact it will have on the broader electric vehicle industry.

related posts