DETROIT — Ford Motor Co. is resuming building on a Michigan electric vehicle battery plant that the corporate postponed two months in the past throughout a strike by the United Auto Workers union.
However the automaker says that as a result of slowing electrical automobile gross sales development, it would reduce the manufacturing facility dimension, chopping the variety of deliberate jobs by about one third from 2,500 to 1,700. The annual battery cell output will drop from sufficient for 400,000 autos per yr to about 230,000.
Ford put the plant, initially to price $3.5b, on maintain in late September because the union went on strike at focused meeting crops run by Ford, General Motors and Jeep maker Stellantis. The contract dispute ended final week with employees in any respect three voting to ratify new agreements.
Spokesman Mark Truby mentioned Tuesday that the corporate checked out development forecasts for electrical automobile gross sales, its EV product plans and whether or not it might make a sustainable enterprise out of the manufacturing facility in Marshall, about 100 miles west of Detroit.
“We at the moment are good to substantiate that we’re shifting ahead with the plant,” he advised reporters.
The plant will open in 2026 on the identical timeline as the corporate set when it introduced the manufacturing facility in February. It can produce batteries with a lithium-iron-phosphate (LFP) chemistry, which is cheaper than the present nickel-cobalt-manganese chemistry now utilized in many EV batteries. Customers will be capable to select between a battery with decrease vary and value, or pay extra for greater vary and energy.
Not like the corporate’s different battery crops which are joint ventures, the Marshall manufacturing facility will likely be a completely owned Ford subsidiary staffed by Ford employees. However China’s Up to date Amperex Know-how Co. Ltd., or CATL, which is understood for its lithium-iron-phosphate experience, would provide know-how, some gear and employees.
Truby mentioned he wasn’t positive how a lot the corporate would spend on the scaled again plant.
U.S. electrical automobile gross sales are nonetheless rising at a excessive fee, however not as quick as they have been final yr, inflicting many automakers to sluggish their battery and meeting plant constructing plans.
In June of final yr, for example, electrical automobile gross sales have been rising about 90% yr over yr, in accordance with Motorintelligence.com. However by June of this yr, the expansion fee had slowed to about 50%, and automakers are fearful it would sluggish even additional with customers having reservations about how far they will journey and whether or not charging stations will likely be out there.
Stacey LaRouche, press secretary for Gov. Gretchen Whitmer, mentioned the announcement implies that 1,700 new jobs and billions price of investments are coming to the state to assist the financial system develop. “Whereas different states have seen tasks placed on maintain, Michigan will likely be residence to Ford’s first battery plant of this sort,” she mentioned.
Otie McKinley, a spokesperson for the Michigan Financial Growth Company, which handles the state’s incentive fund for financial developments, mentioned state incentives for the Ford plant will likely be decreased from the unique numbers primarily based on the ultimate scope of the mission.
The state has allotted practically $1.7 billion in incentives for the mission, and added $65 million in October for website readiness.
When it introduced third-quarter earnings in October, Ford mentioned a slowdown in electrical automobile gross sales and costs has led to a delay in plans to construct one among two new joint-venture EV battery factories in Kentucky that was introduced two years in the past. The corporate is also trimming Mustang Mach-e manufacturing and delaying different spending on EVs totaling $12 billion, Chief Monetary Officer John Lawler mentioned.
Truby mentioned scaling again the Michigan plant was a part of the $12 billion. He mentioned the corporate continues to be bullish on EVs. “Whereas there’s development each within the U.S. and worldwide, clearly the expansion isn’t on the fee that we and others had anticipated,” he mentioned.
Shares of Ford fell simply over 2% Tuesday in a largely down day within the markets for automakers.
