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$750 million asked of lawmakers for Ford battery plant site readiness

Ford Motor Company

Michigan officials are seeking $750 million to support a planned Ford Motor Company electric vehicle battery plant in Calhoun County

The money would go toward infrastructure projects like roads, railways, and water to support the battery operation.

State lawmakers heard a presentation about the ask from the Michigan Economic Development Corporation (MEDC) during a meeting of the House Appropriations Committee.

MEDC Executive Director Quentin Messer Jr. stressed none of the $750 million request would go directly to Ford. He highlighted how long the space for what is eventually planned to be the BlueOval Battery Park has gone unused due to ongoing needs.

“The fact that we have had the good fortune to earn and secure this investment from Ford allows us to accelerate what we would have had to have done to secure any project for this site,” Messer told lawmakers during questioning.

During a follow-up call with reporters, Messer said he would leave it to lawmakers to figure out whether the $750 million should come via a supplemental budget bill to the Fiscal Year 2023 budget or if it should be folded in with the state’s current budget-writing process.

The new request is on top of previous incentives benefiting the project approved by the Michigan Strategic Fund Board during a meeting last week.

Ford is set to receive around $210 million in separate incentives through a grant coming out of the Strategic Outreach and Attraction Reserve (SOAR) Fund. It also got the OK for a Renaissance Zone designation valued at around $772 million in tax breaks across a 15-year span.

Some lawmakers questioned the state’s use of money to support a multibillion-dollar company.

During Wednesday’s committee hearing, state and Ford officials stressed how important attracting the $3.5 billion plant would be for the Marshall area’s economic future.

“This project will create opportunities for young people, allowing them to start their professional careers near their families and closer to home. It will create a new talent pipeline, giving young people the skills and training needed for a high paying job right here in our region. This project will pay dividends for years to come,” Marshall City Manager Derek Perry said.

Ford estimates the plant will bring up to 2,500 new jobs to the region.

The investment marks a change for the company after it passed up Michigan for Kentucky and Tennessee when considering a different manufacturing operation, a little under a year and a half ago.

Michigan had not been under consideration, leading state officials to respond by creating the SOAR fund to bring in new large-scale projects.

On Wednesday, Ford Chief Government Affairs Officer Chris Smith said Michigan was competitive, when asked why the company chose it for a new project this time.

“When we look at the universe of potential sites, there were places perhaps that might have had some of these roads or some of the utilities in place,” Smith said. “But as we put together a plan with [Messer] and his team and looked at all the benefits of investing in Michigan, it really made the point for us that this is the competitive place.”

In addition to questioning the state spending going toward BlueOval, some Republican lawmakers also raised their doubts about Ford’s decision to license lithium iron phosphate battery technology from the Chinese company Contemporary Amperex Technology (CATL).

“I understand the perspective that we’re being brought this morning is that it’s not the Chinese government or the Chinese Communist Party that is the entity here. But I’m sure you’re aware that Chinese national intelligence law requires all Chinese companies to cooperate with the intelligence gathering operations of the Chinese government,” state Representative Andrew Fink (R-Hillsdale) said during Wednesday’s hearing.

Another lawmaker questioned whether there was a domestic alternative company that Ford could have chosen to work with.

Smith said the short answer was no, since CATL is the industry leader in the lithium iron phosphate space. Other automakers like Tesla already use CATL’s batteries in their vehicles, but those are currently imported. Ford’s would be the first domestic manufacturing operation.

In regard to Fink’s concerns, Smith assured lawmakers that security is always a top concern for Ford.

“We always have that issue. We always have to control the site. We always have to control the space. We always have to control our (intellectual property). We always have to have a good cyber policy. We always have to make sure that we are protecting U.S. assets, U.S. technologies, U.S. intellectual property,” Smith said.

He followed up with an assurance that despite Ford’s agreement to work with CATL, it would not receive any tax player money.

For its part, the Chinese government is said to have its own doubts about the project, fearing that Ford will have too much access to CATL's technology.

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