Ford is set to make a major announcement about its plan to build a new lithium iron phosphate battery plant in Michigan. The facility, which is expected to cost $3.5 billion, is expected to be located in the Marshall area and eventually employ at least 2,500 workers.
Ford will own and operate the plant in partnership with Chinese battery company China Contemporary Amperex Technology Co Ltd (CATL), which will act as the technology partner to help develop the batteries. The state of Michigan has been actively marketing the 1,900-acre “megasite” in Marshall, which is located about 100 miles west of Detroit.
See also: CATL to provide lithium iron phosphate (LFP) batteries for Solaris electric buses
While Ford declined to confirm the plans, sources indicate that the company is looking to own the plant outright in order to help qualify the batteries produced for tax credits. This is in response to the Inflation Reduction Act (IRA) legislation passed by Congress in August, which was aimed at weaning the United States off the Chinese battery supply chain and restructuring EV tax credits.
However, Ford’s partnership with CATL has been a point of controversy. Virginia Governor Glenn Youngkin faced criticism for withdrawing from a competition to attract the planned Ford battery plant over its connection to CATL, with a spokesperson for the governor stating that “it became clear that this proposal would serve as a front for the Chinese Communist party.” In response, Michigan Governor Gretchen Whitmer called Youngkin’s decision a “political determination.”
CATL, which declined to comment, has a history of partnering with companies through technology licensing agreements in order to generate stable cash without taking big risks and making investments. The company has signed agreements with Hyundai MOBIS in 2021 and Arun Plus in 2022.
See also: General Motors invest More Than $3 Billion for Electric-Vehicle factory in Michigan
Michigan is becoming a hub for the battery industry, with Chinese battery company Gotion High Tech opening a new $2.36 billion plant in Big Rapids, which is expected to create 2,350 jobs and produce up to 150,000 tons of cathode material and 50,000 tons of anode material annually. In July, Ford announced plans to localize 40 GWh of battery capacity in North America starting in 2026 and has an agreement with CATL to explore supplying battery packs for Mustang Mach-E models in North America starting in 2023. The companies will also discuss cooperation for batteries in Ford vehicles around the world.
