Ford halts construction of $3.5 billion battery factory
Ford has announced that it is pausing work on its Blue Oval Battery Park Michigan, a $3.5 billion battery factory that was supposed to produce lithium iron phosphate (LFP) cells for electric vehicles. The decision comes amid the ongoing UAW strike that has affected the automaker’s operations and supply chain.
Ford said that it is limiting spending on construction at the site in Marshall, Michigan, until it is confident about its ability to competitively run the plant. The company did not reveal how long the pause would last or whether it would affect the planned opening date of 2026.
The battery plant was expected to have an annual capacity of 35 GWh, enough for 400,000 EVs. Ford had partnered with Chinese battery giant CATL to supply the LFP cells, which are cheaper and more durable than other lithium-ion chemistries, but less energy-dense.
UAW strike enters second week, impacts GM and other automakers
The UAW strike, which began on September 18, has involved more than 50,000 workers across the country, demanding higher wages, better benefits, and more job security from General Motors. The strike has cost GM an estimated $1 billion in lost production and has disrupted its supply chain, forcing it to halt or reduce operations at several plants in the US, Canada, and Mexico.
The strike has also affected other automakers, such as Ford, which relies on some parts and components from GM. Ford has had to temporarily close its Kansas City Assembly Plant, which makes the F-150 pickup truck, and its Flat Rock Assembly Plant, which makes the Mustang. Ford has also faced shortages of semiconductors, steel, and other materials due to the global supply chain crisis.
The UAW and GM have been in talks to resolve the dispute, but have not reached a deal yet. The main sticking points include the use of temporary workers, the closure of some plants, and the transition to electric vehicles. The UAW has also expressed concerns about the future of its members who work at GM’s battery plants, which are not fully unionized and pay lower wages than traditional assembly plants.
GM battery plant in New Carlisle continues work, awaits outcome of strike
While Ford has paused work on its battery plant in Michigan, GM has continued work on its battery plant in New Carlisle, Indiana, which is part of a joint venture with LG Energy Solution. The plant, which broke ground in July, is expected to create 1,300 jobs and produce 70 GWh of battery cells per year for GM’s Ultium EV platform.
The plant is one of four battery factories that GM is building in North America, along with two in Kentucky and one in Tennessee. GM has invested $35 billion in its EV and autonomous vehicle strategy, aiming to launch 30 new EV models by 2025 and achieve an all-electric future by 2035.
However, the fate of the New Carlisle plant and its workers may depend on the outcome of the UAW strike, as the plant is likely to be unionized and affected by the contract negotiations. The UAW has been pushing for higher wages, better benefits, and more job security for its members who work at GM’s battery plants, as well as a larger share of the profits from the EV transition.
According to St. Joseph County Executive Director of Economic Development Bill Schalliol, the county has been relatively unaffected by the strike so far, but that could change as the strike drags on. He said that the county is closely watching the developments and hopes for a positive resolution that would benefit both the workers and the industry.