News Story

Ford pauses EV battery project; UAW calls decision ‘shameful’

Though the Ford-CATL project sought non-union labor, striking union sees pause as a threat

Ford Motor Co. will pause its $3.5 billion project to build EV batteries in Marshall, the company announced Monday, citing concerns about its “ability to competitively run the plant.”

As The Detroit News reported:

“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,” Ford spokesman T.R. Reid told The Detroit News on Monday. A “number of considerations” were at play in the company's business decision, he said, but wouldn’t say whether the United Auto Workers’ ongoing strike of Ford and its crosstown rivals was a factor.

“We haven’t made a final decision about the investment there,” Reid said of the Marshall site. The pause in construction is effective Monday.

The Marshall project, named BlueOval Battery Park, was a collaboration with a Chinese firm called CATL. Michigan lawmakers had granted the project about $1.7 billion in cash and other forms of corporate welfare.

BlueOval Battery Park drew major scrutiny, from Marshall residents to officials in Lansing and Washington, D.C. The chairs of three U.S. House committees sent letters to Ford CEO Jim Farley to inquire about the partnership; two of those committees said they were investigating the matter themselves.

Republican lawmakers in Lansing said Ford’s decision is a commentary on the state of Michigan’s business climate, electric grid and energy transition.

“After failing to land other high-profile Ford deals, Gov. Whitmer gave away the store to bring Ford to Marshall,” said Republican House Leader Matt Hall, R-Richland Township. “But with Democrats pushing policies that make Michigan less competitive, the $1.7 billion in subsidies and tax incentives still fell short.”

“The climate in Michigan has become so anti-business that Ford cannot be certain of the project’s profitability, even with billions of dollars in frivolous incentives from the state,” said Rep. Pat Outman, R-Six Lakes, in a statement.

“The governor’s proposed energy mandates are too extreme and will raise already burdensome electricity costs in Michigan, the exact reason why Ford picked Tennessee over our state for a previous project,” Outman added.

Rep. Sarah Lightner, R-Springport, also noted the size of the corporate welfare for the project, saying it wasn’t enough to overcome unfavorable policies.

“Gov. Whitmer threw $1.7 billion in taxpayer dollars at Ford to bring its new EV plant to Marshall, but even that wasn’t enough to make the company turn a blind eye toward the anti-business climate the Democrat majority has created,” Lightner said in a statement. “The extreme energy mandate they’re currently pushing will raise costs even further while leaving large manufacturers like Ford worried about blackouts affecting their bottom line.”

BlueOval Battery Park would not necessarily have been a union facility. A Ford spokesman told The Detroit News in February that “the question of unionization would be up to employees.”

The factory was expected to create 2,500 jobs, paying an average of $45,000 each.

Despite the unclear status of unions at the facility, UAW President Shawn Fain accused Ford of “doubling down on their race to the bottom” by pausing the project.

“This is a shameful, barely-veiled threat by Ford to cut jobs,” Fain said in a statement posted Monday on X. “Closing 65 plants over the last 20 years wasn’t enough for the Big Three, now they want to threaten us with closing plants that aren’t even open yet. We are simply asking for a just transition to electric vehicles and Ford is instead doubling down on their race to the bottom.”

On Friday, when Fain expanded the UAW’s Sept. 15 strike to 38 General Motors and Stellantis parts distribution facilities, he said the Ford negotiations showed significant progress. Fain didn’t expand the Ford strike beyond the Michigan Assembly plant in Wayne, one of the three facilities that kicked off the strike.

The union did not say how the BlueOval Battery Park announcement would affect negotiations with Ford.

President Joe Biden is expected today to join UAW strikers in Michigan after Fain publicly challenged him on Friday to walk the picket line.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.