Ford has officially announced that it is stopping construction on a $3.5 million battery factory in Michigan that the carmaker had focused on just a few months prior as being essential for EV affordability.

About 2,500 people were expected to work at the facility near Marshall, Michigan, and lithium-iron-phosphate (LFP) batteries would be produced there. These batteries tend to be less expensive to create than the nickel-cobalt-manganese (NCM) batteries that Ford now uses in its electric vehicles. Ford stated that the plant would produce “one of the least expensive U.S.-created batteries” when it was first revealed in February.

Having said that, Ford’s decision to hold off appears to be based mostly on the benefit of creating human cells.

At a Tesla Supercharger, a Ford Mustang Mach E

In response to Environmentally Friendly Vehicle Reviews late Monday, after word of the halt spread through social media and a report from The Detroit News, Ford corporate spokesperson T.R. Reid said, “We’re pausing work and restricting spending on building on the Marshall job when we reassess the business conclusion, to be self-confident about our ability to competitively operate the plant.”

In a broader statement to GCR, Reid said, “There are many criteria.” “We have not made any further decisions regarding the planned financial commitment.”

Ford declined to comment to the Detroit Information about whether the choice was related to the ongoing UAW strike, but on Tuesday, President Biden is scheduled to attend a demonstration in Michigan to support the dangling staff.

In addition to costs or labour, other factors, such as dependency on China for licencing of the technologies, may have played a role in the decision. Despite this, Ford was required to fully own and operate the factory.

Comparison of NCM and LFP battery types by Ford

Ford asserted at the time of the introduction that LFP batteries have many advantages. As they can be charged from -100% daily and are the preferred option for bidirectional charging, they help improve the supply chain by reducing the burden on some high-demand, high-cost components. On the other side, they are a little bit heavier than NCM tech and might be slow to cost in extremely cold conditions.

Since late 2021, Tesla has begun introducing LFP cells into the Product 3 Normal Range, and business owners have reacted incredibly favourably to them.

introductions of Ford LFP merchandise

Ford concluded that the decision was informed by data on both motor vehicle use and overall cost, and that LFP batteries have been reserved for the Mustang Mach-E and F-150 Lightning.

Deliveries of LFP Mach-E are planned to start later this year. While variations of the Ford Mustang Mach-E with an LFP battery pack will qualify for the same $3,750 EV tax credit total as other recent Mach-E Prolonged Array models, variations of the Tesla Model 3 with LFP cells will be eligible for the full $7,500 total of the EV tax credit.