Ford pauses work on $3.5 bn battery plant

DETROIT

Ford is halting work on a major battery plant in the northern U.S. state of Michigan, the automaker has said, just seven months after launching the project with a Chinese partner.

The stoppage, which a Ford a representative confirmed to AFP, comes as the company faces a major strike along with both of the other "Big Three" U.S. automakers, Stellantis and General Motors.

The Ford spokesperson insisted the decision about the $3.5 billion battery plant had not been related to the ongoing strike, but rather the site's future economic viability.

"We're pausing work and limiting spending on construction on the Marshall project until we're confident about our ability to competitively operate the plant," the spokesperson said.

"We haven't made any final decision about the planned investment there," he added.

In February, Ford announced the project in Marshall, Michigan as a way to diversify its battery profile away from its current exclusive use of nickel cobalt manganese (NCM), which are costly to produce because of raw material scarcity.

Ford said it would work with the Chinese company Contemporary Amperex Technology Co. to manufacture lithium iron phosphate batteries beginning in 2026 at the Marshall plant.

Several Republican officials had voiced opposition to the plant due to the partnership with a Chinese company.

The technology involves less expensive raw materials and can tolerate more frequent and faster charging than NCM batteries, the company said at the time.

The auto giant said it is targeting annual global output of 600,000 electric vehicles by end-2023 and two million by the end of 2026.

Michigan Governor Gretchen Whitmer, a Democrat, touted the announcement in February as "another win for Michigan," citing the addition of 2,500 new manufacturing jobs.