The Electric: Ford Risks Political Heat With a Deal to Make Chinese Batteries on U.S. Soil

In a risky move that’s already creating political waves, Ford on Monday plans to announce a deal with China’s Contemporary Amperex Technologies Ltd. to build electric vehicle batteries in Michigan. In a display of the thorny politics, President Joe Biden declined an invitation to join Michigan Gov. Gretchen Whitmer and Ford CEO Jim Farley at the announcement, according to people familiar with the situation, and a Republican congressman quickly criticized the agreement.  

The deal involves the construction of a $2.5 billion gigafactory producing relatively inexpensive lithium-iron-phosphate batteries in the town of Marshall, Mich., the Detroit News reported. Reuters said the cost would be $3.5 billion. A plant in that cost range can typically turn out 1 million batteries a year. Ford has said it will produce 600,000 EVs in the U.S. by the end of this year and 2 million in 2026. Most of the batteries for those EVs will be imported at first, since the plants to make them are only now being built, but the CATL tie-up is part of Ford’s effort to quickly scale up its U.S. battery manufacturing capacity.