Ford Suspends Work on a $3.5 Billion Ev Battery Plant in Michigan

September 26, 2023

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Ford Motor Co. announced on Monday a temporary suspension of work on its $3.5 billion battery factory project in Marshall, Michigan, a decision that follows recent concessions made to striking employees.

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"We are currently pausing construction work and restricting expenditures on the Marshall project until we can ensure the plant's competitive operational viability," stated a spokesperson for Ford (F, -0.52%). "A final determination regarding the planned investment has not yet been reached."

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In February, Ford had disclosed its intention to invest $3.5 billion in the construction of the facility, known as BlueOval Battery Park Michigan, located approximately 100 miles west of Detroit. The project was emblematic of Ford's dedication to American manufacturing.

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Anticipated to employ around 2,500 individuals upon commencing production in 2026, the $3.5 billion investment was part of Ford's larger commitment to allocate over $50 billion towards electric vehicle development worldwide by that year.

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Meanwhile, certain sections of a Ford plant in Michigan, responsible for producing Broncos and Rangers, have been engaged in a strike since September 14th, marking the initial wave of labor actions by the United Auto Workers (UAW). This labor unrest has also affected a single plant each at General Motors Co. (GM, -1.38%) and Stellantis NV (STLA, -1.01%) following the expiration of the union's contract without progress in negotiations.

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Last Friday, the UAW extended the strike to 38 distribution centers operated by GM and Stellantis across 20 states but refrained from expanding the labor action to include Ford. The union cited obtaining concessions from Ford, including the reinstatement of cost-of-living adjustments, as the reason for this decision.

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During this strike, legacy automakers find themselves under significant pressure to allocate resources for electric vehicle investments, with batteries being a particularly critical and costly component in this transition.

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