Ford and CATL Plan to Build Battery Plant in Michigan, Investment Amounted to USD 3.5 bn

According to Bloomberg, people familiar with the matter revealed that Ford Motor Co. (Chinese: 福特汽车) and CATL (Chinese: 宁德时代) plan to build a battery plant in Michigan.

The new plant, which will cost billions of dollars, will be located about 100 miles west of Detroit and is expected to create about 2,500 jobs, the people familiar with the matter said. As for the exact amount of investment, Reuters' sources said it is USD 3.5 billion. It is reported that the agreement could be announced to the public as early as this week. The new plant site has some room for growth and could lead to more jobs and greater investment.

“We’ve said that we’re exploring batteries based on CATL’s technology for Ford vehicles and that we plan to localize production in North America” , Ford said in an emailed statement. The company didn’t specify whether it had picked a location or determined other details of the project’s scope.

The US carmaker and China’s CATL, the world’s biggest maker of batteries for electric vehicles, have been weighing a novel ownership structure under which Ford would own 100% of the plant, including the building and the infrastructure, Bloomberg reported last year. Ford workers would build the batteries, while CATL owns the technology to create the cells. Such an arrangement may allow the facility to qualify for lucrative production tax credits under the Inflation Reduction Act while requiring no direct financial investment from CATL.

Ford announced in July it will begin using less expensive lithium iron phosphate battery packs from CATL on its Mustang Mach-E models this year and F-150 Lightning pickups in early 2024, which will boost output of those popular vehicles. Ford has said it has a plan to source 40 gigawatt hours of those batteries annually in North America in 2026, but would initially import them from China.