The Ford Motor Company has suspended work on its $3.5bn electric vehicle (EV) battery plant in the city of Marshall, Michigan, over concerns that it will not be able to run the factory at a profit.
The United Auto Workers union, currently striking, called it a “threat”.
A Ford spokesperson told Detroit News yesterday: “We’re pausing work, and we’re going to limit spending on construction at Marshall until we’re confident about our ability to competitively run the plant.”
He added that a number of considerations had influenced the company, but did not say what they were.
The 23ha battery park was to be run by Ford’s Blue Oval subsidiary, and would have employed 2,500 people.
The company is presently in negotiations with the United Auto Workers union following the calling of a strike at its Wayne assembly plant in Michigan.
Shawn Fain, the union’s president, called Ford’s move Monday “a shameful, barely veiled threat”.
He added: “We are simply asking for a just transition to electric vehicles, and Ford is instead doubling down on their race to the bottom.”
Blow to Michigan
The decision will come as a blow to the state of Michigan, which failed to attract a $11.4bn investment Ford and South Korean conglomerate SK On made in Tennessee and Kentucky (see further reading). The state had offered Ford $210m in incentives, conditional on it meeting certain employment and investment targets.
Another bone of contention was Ford’s plan to license battery technology from Chinese company Contemporary Amperex Technology (CATL) – although the company assured lawmakers that CATL would not benefit from state tax incentives.
Some Republican congress members have asked Ford for copies of the licensing agreement and communications between Ford and CATL, although other US car-makers, such as Tesla, also import CATL batteries.