Ford EV battery plant on Marshall Michigan megasite gets $1B in incentives

• Ford plans a $3.5 billion EV battery factory in Marshall, Michigan
• Ford says it will open in 2026, employing 2,500 people and using a design licensed by a Chinese partner
• The Marshall factory will be the first lithium iron phosphate (LFP) battery factory in U.S., allowing Ford to sell two battery styles

Michigan will give Ford Motor Company just over $1 billion in incentives —  including a $210 million grant and a waiver of property taxes on hundreds of rural acres between Marshall and Battle Creek — to support the building of a $3.5 billion battery facility that is promised to employ at least 2,500 people when it opens in 2026.

Ford on Monday unveiled details of the project — to be called Blue Oval Battery Park Michigan — that will be owned by a wholly owned subsidiary of the nation’s third-largest automaker. The broad outlines of the project were reported by Bridge Michigan on Friday. 

“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,” Bill Ford, Ford executive chair, said Monday as the automaker announced the project in Romulus. 

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 “I am also proud that we chose our home state of Michigan for this critical battery production hub.”

Michigan will provide a $210 million grant toward the project, after a vote on Monday afternoon by the Michigan Strategic Fund, the public funding arm of the Michigan Economic Development Council. 

The MSF board unanimously approved the grant, along with creating a 15-year renaissance zone that will allow Ford to run the plant essentially tax-free. 

Local economic developers also will receive a $36 million loan from the Jobs for Michigan Investment Fund to purchase parcels and make infrastructure improvements to 950 acres of the 1,900-acre megasite. The Marshall Area Economic Development Alliance has been leading the development effort on the so-called megasite for about 15 years.  

In exchange, the state expects the new Ford factory to generate $29.7 billion in personal income over the next 20 years due to workers being paid from $20 to $50 per hour.

“Ford’s $3.5 billion investment creating 2,500 good-paying jobs in Marshall building electric vehicle batteries will build on Michigan’s economic momentum,” Michigan Governor Gretchen Whitmer said in a statement. “Today’s generational investment by an American icon will uplift local families, small businesses, and the entire community and help our state continue leading the future of mobility and electrification.”

The factory will be the first in the U.S. to produce lithium iron phosphate (LPF) batteries, which Ford says will make EVs more affordable. The Chinese partner, Contemporary Amperex Technology Co. Ltd. (CATL), will supply the technology design and early versions of the batteries until the factory opens for operation. 

The battery technology will use “fewer high demand, high cost materials, ultimately making EVs more accessible and affordable for customers,” Gabby Bruno, Ford regional director of government relations, told the MSF on Monday.

According to the company, the new LFP plant reduces traditional shipping and import costs. Ford also will benefit from the federal  Inflation Reduction Act — creating one of the lowest-cost U.S.-produced batteries when the plant comes online in 2026.

LFP batteries are durable and tolerate more frequent and faster charging, Ford says, in comparison to the nickel cobalt manganese batteries more commonly used in American EVs.

Ford plans to start offering LFP batteries supplied by CATL on the Mustang Mach-E this year and F-150 Lightning in 2024.

The Marshall project is part of Ford’s $50 billion global push toward EV production. So far, Ford said, its U.S. investment totals $17.6 billion in electric vehicle and battery production since 2019.

The all-new battery production facility in Marshall 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.

Marshall area officials said they welcome the project on a portion of a 1,900-acre megasite, despite some community opposition.

“This investment in the local community will lead to an influx of new jobs to Marshall and economic development throughout the area,” Marshall Mayor Jim Schwartz.

Among the benefits, Schwartz said, is that Ford promises  245 acres at the southern edge of the 1,900-acre site will be placed into a conservation easement. This land, along the Kalamazoo River, will be protected against future industrial development. 

The automaker also said it will preserve natural resources and recreation near the facility ,and that the Ford Fund will contribute resources to help the community decide how to use the parkland.