Ford Says Michigan Battery Plant at Risk If Tax Credits Are Cut

Bill Ford announces at a press conference that Ford will be partnering with the world's largest battery company, the Chinese firm Contemporary Amperex Technology, to create an electric-vehicle battery plant in Marshall, Michigan, on Feb. 13, 2023. Photo by Bill Pugliano /Photographer: Bill Pugliano/Gett

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(Bloomberg) — Ford Motor Co.’s plan to make electric-vehicle batteries at a new site in Michigan would be put at risk if Congress cuts federal incentives for clean energy, the company’s chair said.

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The plant in Marshall, Michigan — and the 1,700 workers that Ford plans to employ there — would be “imperiled” if US lawmakers move to eliminate tax credits that support battery producers as part of a broader tax plan moving through congress, Ford Executive Chair Bill Ford said Thursday during remarks at the Mackinac Policy Conference at Michigan’s Mackinac Island.

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“It’s not fair to change policy after all the expenditures have been made,” Ford said. “The production tax credit seems to be up for grabs.”

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After the event, Ford told reporters that “nothing needs to change” about the production tax credit because “we have built the business case on Marshall around that.”

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President Joe Biden’s signature climate bill included several tax credits designed to help establish an EV supply chain and support consumer demand for plug-in cars.  

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Republican lawmakers are moving to unwind those policies. In addition to phasing out a $7,500 consumer tax credit for electric vehicles, the House-passed bill would end a manufacturing credit for battery makers after 2031. It would also mandate strict restrictions against the use of Chinese components and materials that analysts say could effectively render it useless.

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“Politicians can agree or disagree about whether those things are desirable,” Ford said. “But don’t change the rules once you’ve already made the investment because that to me is just a question of fairness. And that’s unfair.”

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The legislative risks mark the latest potential hurdle for a plant Ford announced in 2023 that was originally intended to produce enough batteries for 400,000 EVs, part of an earlier ambitious plan to electrify its lineup. The automaker later reduced that target to power about 230,000 EVs as consumer demand for the technology faltered.

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