Ford Motor Co. in Dearborn announced today that it is investing $3.5 billion to build the country’s first automaker-backed lithium iron (ferro) phosphate (LFP) battery plant in Marshall, east of Battle Creek.
When production begins in 2026 at what the company will call BlueOval Battery Park Michigan, it will employ 2,500 people and offer a second electric vehicle battery chemistry to Ford customers.
“We are committed to leading the electric vehicle revolution in America, and that means investing in the technology and jobs that will keep us on the cutting edge of this global transformation in our industry,” says Bill Ford, executive chair of Ford. “I am also proud that we chose our home state of Michigan for this critical battery production hub.”
Virginia, however, was reported to be Ford’s first choice for the facility but was denied last month by Gov. Glenn Youngkin due to its ties to the Chinese battery company Contemporary Amperex Technology Co., Ltd. (CATL).
Still, diversifying and localizing Ford’s battery supply chain in the countries where it builds EVs should improve availability and affordability for customers while strengthening consumer demand, according to the automaker.
Ford says it’s working to deliver an annual run rate of 600,000 electric vehicles globally by the end of this year and 2 million globally by the end of 2026 as part of its Ford+ plan.
As the company rapidly scales EV production, introducing LFP batteries allows it to produce more electric vehicles and offer more choices to new EV customers, and helps support the company’s goal of an 8 percent EBIT margin for Model e by 2026.
In addition to LFP batteries being less expensive to produce than NCM (nickel cobalt manganese) batteries, bringing this new LFP plant to America reduces traditional shipping and import costs, the company says. Building in Michigan, Ford says it will benefit from the Inflation Reduction Act – creating one of the lowest-cost U.S.-produced batteries when the plant comes online in 2026.
Offering LFP as a second battery chemistry – in addition to NCM – allows Ford customers to choose an electric vehicle with battery performance characteristics most aligned with their needs.
LFP batteries can be durable, and can tolerate more frequent and faster charging, while using fewer high-demand, high-cost materials. This lower-cost battery, at scale, will help Ford contain or even further reduce EV prices for customers, according to the company. These LFP batteries will power a variety of affordable, next-generation Ford EV passenger vehicles and trucks under development, most of which will be assembled in the U.S.
“Ford’s electric vehicle lineup has generated huge demand,” says Jim Farley, president and CEO of Ford. “To get as many Ford EVs to customers as possible, we’re the first automaker to commit to build both NCM and LFP batteries in the United States. We’re delivering on our commitments as we scale LFP and NCM batteries and thousands, and soon millions, of customers will begin to reap the benefits of Ford EVs with cutting-edge, durable battery technologies that are growing more affordable over time.”
Before the new battery plant opens, Ford plans to introduce LFP batteries on the Mustang Mach-E this year and F-150 Lightning in 2024 to increase production capacity, with a goal of reducing wait times for customers.
This all-new battery production facility in Michigan will add approximately 35 gigawatt hours per year of new battery capacity for Ford in the U.S. initially — capable of powering approximately 400,000 future Ford EVs.
With this $3.5 billion investment, Ford and its battery technology collaborators have announced $17.6 billion in investments in electric vehicle and battery production in the United States since 2019, as part of the company’s commitment to invest more than $50 billion in electric vehicles globally through 2026.
In the next three years, these investments will lead to more than 18,000 direct jobs in Michigan, Kentucky, Tennessee, Ohio, and Missouri, and more than 100,000 indirect jobs, according to a 2020 independent study.
As part of Ford’s plan to offer a new battery chemistry and source in key regions where it produces EVs, Ford has reached a new agreement with China-based CATL, the world’s leading battery manufacturer. Under the arrangement, a Ford wholly owned subsidiary would manufacture the battery cells using LFP battery cell knowledge and services provided by CATL, which has operated 13 plants in Europe and Asia. Ford engineers will integrate these LFP battery cells into its vehicles.
This new agreement with CATL adds to Ford’s existing battery capacity and available battery technology made possible through a series of key collaborations – including with SK On and LG Energy Solution (LGES).
LFP battery technology helps reduce reliance on minerals such as nickel and cobalt and is in line with Ford’s work to create an EV supply chain that upholds its commitments to sustainability and human rights.
Ford already has committed to achieving carbon neutrality globally across its vehicles, operations, and supply chain by 2050. Ford was among the first American automakers to align with the international community to limit the impacts of global warming as part of the Paris Agreement and joined RouteZero, a global coalition working toward zero-emission cars and vans globally by 2040 and in leading markets like the U.S., Europe, and China by 2035. Ford also was the first U.S. automaker to release a human rights report.
In addition to the new plant in Marshall, Ford says it is ensuring that 245 acres at the southern edge of the plant site are placed into a conservation easement. This land, along the Kalamazoo River, will be preserved for generations to come and protected against future industrial development. Ford says it will work with government officials and community leaders to preserve natural resources and recreation near the facility.
The Ford Fund also will contribute resources to help the community explore how to best enjoy the land.
“The city of Marshall welcomes this exciting new partnership with Ford Motor Co.,” says Jim Schwartz, mayor of Marshall. “This investment in the local community will lead to an influx of new jobs to Marshall and economic development throughout the area. We are especially excited to support Ford’s conservation easement which will preserve Michigan’s natural beauty along the Kalamazoo River.”
