Ford plans EV battery factory in Michigan
China company would supply some technology, workers
DETROIT — Ford Motor Co. plans to build a $3.5 billion factory in Michigan that would employ at least 2,500 people to make lower-cost batteries for a variety of new and existing electric vehicles.
The plant, to be built on land about 100 miles west of Detroit, would start making batteries in 2026. It would crank out enough batteries to supply 400,000 vehicles per year, Ford said.
The factory near the city of Marshall would produce batteries with a lithium-ironphosphate (LFP) chemistry, which is cheaper than the current nickel-cobalt-manganese chemistry now used in many EV batteries.
Ford says a wholly owned subsidiary would own the factory and employ the workers. But China’s Contemporary Amperex Technology Co. Limited, or CATL, which is known for its lithium-iron-phosphate expertise, would supply technology, some equipment and workers.
The announcement comes at a time when U.S.-China relations are strained, and the Biden administration is offering tax credits for businesses to create a U.S. supply chain for EV batteries. To get a full $7,500 per vehicle U.S. tax credit to customers, EV batteries won’t be able to have metals or components from China in them.
The structure of the deal allows Ford to take advantage of U.S. factory tax credits in the Inflation Reduction Act. Because it’s not a joint venture, it could stem criticism about the company doing business with the Chinese. Last month, Virginia dropped out of the race for the same Ford plant after Gov. Glenn Youngkin characterized the project as a “front” for the Chinese Communist Party.
The company says buyers initially would get at least $3,750 in tax credits because the vehicles are produced in North America. Marin Gjaja, chief marketing officer for Ford’s electric vehicles, said that over time they could get the full $7,500 credit depending on sourcing of battery minerals.
The plant was revealed Monday at a meeting of the Michigan Strategic Fund, which approved a large incentive for the project near the junction of Interstates 94 and 69.
“We were looking not only in the U.S. We were looking outside of the U.S., as well,” said Bill Ford, Ford Motor Co. executive chair. “There were a lot of places in play, because, as you can imagine, a lot of states and even countries would like this kind of investment. But Michigan really stepped up.”
“I was always biased in favor of Michigan, because my family’s been here for generations,” he added.