Ford counts back on its EV battery factory plans in Michigan. The automaking company will no longer be investing the full $3.5 billion for a new battery plant in Michigan as the firm faces rising costs for labor as well as the slowing demand for electric vehicles.
Ford EV Battery Factory Plans
Ford reportedly announced that it is now cutting production capacity on its upcoming electric vehicle battery plant, amid slowing customer demand for buying EVs as well as rising labor costs. The automaker states that it will reduce its original $3.5 billion of its planned investments to build the Michigan plant to somewhere around $2 billion and it is now only expecting to hire 1,700 workers instead of the proposed 2,500.
Ford’s Partnership with China’s Contemporary Amperex Technology (CATL)
Ford originally had announced the ambitious Michigan battery plant back in February in partnership with China’s Contemporary Amperex Technology (CATL), which is a company that makes LFP (lithium iron phosphate) batteries. The plant in question will now only produce about 20 gigawatt-hours of batteries each year, which is reported to be about a 43 percent cut.
What EV-Making Companies Need To Qualify For Federal Tax Credits
In a bid for EVs to qualify for up to $7,500 in federal tax credits, automakers all over must source at least 40 percent of their battery materials from North America or US trading partners by the year 2024. The partnership of Ford with CATL has also made it quite a target of anti-China GOP politicians.
Ford’s Plan on the New Facility
The automaker however still plans to open the new facility on target in the year 2026 despite halts to recent production during the UAW labor union strike in the previous month. The firm also just recently put off its reported plans to build its Kentucky battery plant.
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