According to Reuters, on July 8, Ford Motor Company said it plans to build a $3 billion investment in Marshall, Michigan, after a large-scale U.S. tax and budget bill amended the relevant rulesElectric vehicleBattery factories (currently 60% complete) are expected to receive production tax credits.
Image source: Ford Motor official website
Earlier this year, Republicans in the U.S. House of Representatives proposed a comprehensive tax reform bill to eliminate the electric vehicle tax credit policy, and automakers and battery manufacturers can still enjoy a key battery production tax credit, but added a new restrictive clause: if the vehicle uses parts produced by Chinese companies, or is produced based on a technology license agreement of a Chinese company, it will lose its tax credit eligibility. If this clause takes effect, car companies such as Ford and Tesla will be affected.
Bill Ford, executive chairman of Ford Motor Company, has warned that if the U.S. government cancels the tax credit for electric vehicle battery production using Chinese technology, Ford’s battery plant under construction in Marshall will face significant risks. Construction of the plant began in February 2023 and is expected to start producing batteries in 2026, with the original plan to create 1,700 jobs.
However, the final bill amended the wording regarding the tax credit for battery production. On July 8, Ford said that Marshall’s “plant is expected to receive a production tax credit — a big benefit for our customers and a big plus for U.S. competitiveness.” It is reported that the factory will use the technology of battery giant CATL to produce battery cells.
Last year, Ford lowered its expectations for battery factoriesyieldIn response to the slowdown in demand for electric vehicles, incentives received from Michigan have declined.
The bill takes steps on several fronts for electric vehicles, including ending the $7,500 new EV tax credit and the $4,000 used car tax credit as of September 30. However, U.S. automakers will also benefit from the bill, which exempts automakers from fines if they fail to meet certain fuel economy standards.