Context:

Ford Motor Company is determined to complete the construction of a new $3 billion battery manufacturing plant in Marshall, Michigan, despite potential loss of federal tax incentives due to a policy bill backed by President Trump. The factory, which will use technology licensed from the Chinese company CATL, was initially planned with the expectation of financial support from the Inflation Reduction Act. The proposed Republican bill could deny tax credits to plants using Chinese technology, potentially impacting Ford's financial projections. Ford's commitment remains steadfast, as it plans to create 1,700 jobs and address the growing demand for electric vehicle (EV) batteries. Furthermore, the United Automobile Workers union warns that removing tax credits could significantly harm EV sales and manufacturing jobs in the U.S., exacerbating the situation for unionized workers at the plant.

Dive Deeper:

• Ford is committed to opening a new battery plant in Marshall, Michigan, despite the risk of losing tax incentives due to a Republican policy bill targeting Chinese technology. The plant, expected to cost $3 billion, was planned with the support of tax credits from the Inflation Reduction Act, which aimed to promote clean energy initiatives.

• The political landscape poses a challenge as the Republican bill, supported by President Trump, could eliminate tax credits for plants using technology from countries like China. Ford licensed battery technology from CATL, a Chinese company, making the plant susceptible to these potential legislative changes.

• Lisa Drake, vice president for technology platform programs and E.V. systems at Ford, emphasizes the company's commitment to its investments, stating that Ford will proceed with the plant's construction even if the tax credits are revoked. The plant is projected to create 1,700 jobs and produce lithium iron phosphate batteries, which are cost-effective compared to traditional nickel and cobalt batteries.

• The United Automobile Workers union expresses concerns that removing tax credits could slash EV sales by up to 40% by 2030, leading to job losses and the cancellation of planned manufacturing facilities. Union officials highlight the irony of Congress voting against jobs that workers have fought to secure through unionization.

• Ford argues that without the promise of tax credits from the Biden administration, the plant would likely have been built outside the United States. The factory faces further financial strain due to tariffs imposed on manufacturing machinery imported from China, complicating the economic feasibility of the project.