Thursday 28 September 2023

Ford pauses construction of $3.5 billion EV battery plant in Michigan amid scrutiny over CCP involvement with the project

 Automaking giant Ford has halted construction on a $3.5 billion electric vehicle battery manufacturing factory amid an ongoing probe by House Republicans over the company's ties with China.

Ford announced plans to construct the 950-acre BlueOval Battery Park in the small town of Marshall, Michigan, around 90 miles west of Detroit, on Feb. 13 and promised that the project would bring 2,500 jobs to the town of under 7,000 residents. But a statement from Ford spokesperson T.R. Reid has put all of this work on hold.

"We are pausing work and limiting spending on construction on the Marshall project until we're confident about our ability to competitively operate the plant," said Reid. "We haven't made any final decision about the planned investment there."

Reid added that a "number of considerations" went into this decision. While he did not disclose what these factors are, it should be noted that the suspension of construction on the factory coincides with an ongoing strike by the United Auto Workers.

Furthermore, the pause comes as Ford has increasingly drawn ire from Michigan and Congressional Republicans alike, as well as local residents, over the ties the company made with the Chinese Communist Party (CCP) for the factory.

To manufacture EV batteries at BlueOval, Ford plans to rely on licensed Chinese technology from Contemporary Amperex Technology Co. Limited (CATL), a Chinese firm and the world's largest manufacturer of EV batteries. CATL has also developed some of the most advanced technology for lithium iron phosphate batteries.  

House Select Committee on China Chairman Mike Gallagher of Wisconsin has led a probe into the facility. Following the announcement of the pause on BlueOval's construction, Gallagher called on Ford to "call off this deal for good."

"CATL's deep ties to CCP forced labor have no place in the American market and make the company exceptionally unfit to receive American taxpayer dollars," he said.

Ford has maintained that it would own and control the plant and that Chinese involvement would be limited strictly to being a licensor of battery cell technology.

Despite CCP connections, BlueOval project still received over a billion in taxpayer-funded subsidies

Michigan authorities awarded the BlueOval project a patchwork of incentives totaling $2.2 billion. This includes a $120 million grant to the Marshall Area Economic Development Alliance and an additional $630 million for site work of the mega site included in a state supplemental budget bill.

The state government has also provided Ford with a $210 million grant as well as a massive tax break valued at $774 million.

These subsidies have come from the taxpayer-funded incentive program known as the Strategic Outreach and Attraction Reserve. The BlueOval project is one of four cornerstone projects meant to receive massive subsidies from this fund. Ford has denied that any of the taxpayer funding it has received would be funneled to the CCP.

This program was created by Michigan Democrats, including Gov. Gretchen Whitmer, in 2021 after the state lost out on a $11.4 billion investment that Ford and a battery partner made in EVs and batteries at two sites in Kentucky and Tennessee.

Republicans and locals alike have celebrated the pause on construction. Michigan Republican Rep. Lisa McClain wrote on Twitter that the pause was "GREAT news for Michigan and a serious blow to the CCP."

"Chinese technology has no place in our country and I am glad to see this battery plant be put on hold," she added.

The local opposition group the Committee to Save Marshall – Not the Megasite has also celebrated the news, with organizer Glenn Kowalske noting that halting construction has always been the group's goal.

"And it would be the goal moving forward," Kowalske added. "It's late because the land has [already] been heavily modified."

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