Ford suspends $3.5B EV battery factory collaboration with CATL from China

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Ford has halted construction on a $3.5 billion factory in Michigan that was intended to produce affordable lithium iron phosphate batteries with technology from China’s CATL. The decision to pause work on the project was made due to concerns about the plant’s competitive operation. Ford spokesperson TR Reid stated that several considerations prompted the pause, although they did not provide specific details or confirm if the investment would be abandoned permanently. This development comes after United Autoworkers launched a strike that impacted Ford, GM, and Stellantis, as well as congressional investigations into Ford’s licensing deal with CATL.

Ford initially committed $3.5 billion to the factory as part of its larger plan to invest over $50 billion in electric vehicles globally by 2026. The factory, known as BlueOval Battery Park Michigan, received $1.7 billion in state incentives and was projected to employ 2,500 workers with production starting in 2026. Governor Gretchen Whitmer, who played a role in securing the incentives, expressed her commitment to supporting Michigan’s status as a home for world-class automakers and ensuring jobs for workers. Despite the pause, Ford maintains that it is a temporary measure, emphasizing the need for successful negotiations between the Big 3 automakers and UAW to resume work and provide employment opportunities to Michiganders.

Overall, Ford’s decision to halt work on its battery factory in Michigan raises concerns regarding the project’s future and its implications for the automaker’s electric vehicle ambitions. It also coincides with ongoing labor disputes and congressional investigations, further complicating the situation. The pause underscores the challenges and uncertainties faced by automakers as they navigate the rapidly evolving electric vehicle landscape and strive to meet ambitious production targets. Ultimately, the resolution of these issues will determine whether the project resumes and contributes to Ford’s plans to significantly increase global electric vehicle production.

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