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Automaker Ford is to set to build its first US greenfield
vehicle assembly plant without a partner in more than half a
century, with all of the production to be electric vehicles (EVs),
it said this week.
The plant will be part of an $11.4-billion investment package
that will include a separate battery complex with South Korean
partner SK Innovation.
As part of the company's largest ever investment, Blue Oval
City, as the Tennessee assembly plant will be known, will be the
first such solo Ford site to begin operations since the Kentucky
Truck Plant opened in 1969, Ford spokeswoman Jennifer Flake said in
an email 29 September.
"This is a transformative moment where Ford will lead America's
transition to electric vehicles and usher in a new era of clean,
carbon-neutral manufacturing," Ford Executive Chair Bill Ford said
in a statement.
The new plants are part of company plans for capital expenditure
in excess of $30 billion on EVs through 2025.
Ford's decision to build an all-EV plant aligns with its 5
August commitment to President Joe
Biden for EVs to account for 40-50% of their annual US volumes by
2030.
IHS Markit Principal Research Analyst Stephanie Brinley said it
is difficult to underestimate the significance of the announcement.
Blue Oval City will involve Ford rethinking its manufacturing
processes, she added.
The $5.6-billion Blue Oval City campus in Stanton, Tennessee,
will host assembly of an expanded lineup of electric F-Series
trucks, the company said. The company's conventionally fueled F-150
truck is the best-selling automobile in the US. Production at the
site is expected to start in 2025, it added.
Also, the Stanton facility will include a BlueOvalSK battery
plant, buildings for key suppliers, and recycling. The plant is
designed to be carbon neutral with zero waste to landfill once
fully operational, Ford said.
Environmental considerations influenced the decision on where to
locate the plant. The site was chosen in part because of the
opportunity to use local renewable energy sources such as
geothermal, solar and wind power, the company said.
Ford also aims to minimize the environmental footprint of the
site by partnering with Redwood Materials on recycling batteries.
Redwood Materials was founded by Tesla Co-founder JB Straubel.
The scale and cost of the investment program announced by Ford
this week, as well as the plan for the F-Series EV to be the
cornerstone of Blue Oval City, indicates Ford's commitment both to
its EV transition and to the F-Series, said Brinley.
Kentucky battery park
Alongside the Tennessee investment, Ford plans to build a
dedicated battery manufacturing complex in Kentucky with SK
Innovation—the $5.8 billion BlueOvalSK Battery Park. Twin
plants at the site are set to supply North American assembly plants
with batteries for Ford and Lincoln EVs.
Long-time partners Ford and SK Innovation plan to open the
manufacturing campus in Glendale, Kentucky, in 2025. Kentucky
Governor Andy Beshear said the facility would be the "single
largest investment in the history of our state."
The Kentucky plants will be capable of producing up to 43 GWh of
batteries each a year. Alongside the capacity of the Stanton
facility, the partnership will have a battery production capacity
totaling 129 GWh in 2025, more than double Ford's target of 60 GWh
announced in May.
SK Innovation intends to build about 200 GWh of annual battery
capacity in North America to supply Ford and other automakers.
In March 2019, SK Innovation broke ground in Georgia on a
factory that would manufacture 9.8 GWh/year of batteries for EVs,
and the same year announced plans for a second even bigger plant in
the state.
Those SK Innovation plants' prospects were shaky for a while as
the company battled rival South Korean battery giant LG Energy
Solution in court. The companies agreed to settle all legal
disputes in South Korea and US ahead of an 11 April deadline for
Biden to overturn a US International Trade Commission ruling via
presidential veto.
Opportunities
Biden, a Democrat, has barreled ahead with investment plans for
the EV ecosystem and the wider energy transition since assuming
office in January, often provoking accusations of spendthrift
budgeting from across the political aisle. But Republican lawmakers
from both states welcomed the Ford announcement.
"Ford's investment in the [Memphis Regional Megasite] will bring
in thousands of jobs and will reshape West Tennessee's economy for
generations to come," Representative David Kustoff,
Republican-Tennessee, said 27 September.
US Senate Minority Leader Mitch McConnell, one of two Kentucky
senators, added: "I look forward to continuing to pursue
pro-business policies in Kentucky and nationwide that will allow
great American companies like Ford to continue to prosper and grow
our economy."
The plan could also ease pressure on the global supply chain for
batteries, which the Biden administration identified in February as
a concern as it seeks to support the energy transition.
Environmental activists, typically at loggerheads with
congressional Republicans across a multitude of arenas, also saw
the benefits.
"If anyone was still wondering whether the electric vehicle
revolution is real, Ford emphatically answered that question
today," Environmental Defense Fund President Fred Krupp said 27
September. "The transformative commitments and action from leading
US automakers such as Ford and General Motors (GM) have made the
transition to clean transportation inevitable."
Krupp said he hoped the announcement inspires members of
Congress to bring their discussions on infrastructure and budget
reconciliation to a successful close "by acting with the same
courage and vision that Ford has shown today."
By a vote of 69 to 30, the US Senate on 10 August passed a
downsized $1.2-trillion infrastructure plan, HR 3684. The House of
Representatives is set to vote on the bill 30 September. It
includes $7.5 billion for a national EV-charging network as well as
$5 billion to acquire zero-emission and low-emissions buses and
another $2.5 billion for low-emissions ferries.
Progressives on the Democratic side of the House have been
shying away from voting on the bipartisan infrastructure
legislation if they can't also pass a separate $3.5 trillion
spending bill that would revamp US programs protecting low-income
segments of society and raise taxes on the wealthy to cover some of
the cost of the new spending.
Detroit pursues EV goals
The spending bill would be historic in size, much like the
transformation underway in the US auto industry as it transitions
to EVs. As McConnell noted, Ford's Detroit-based rivals are also
striding ahead with plans for EV models.
GM on 28 January said it intended to sell only
electric versions of its light-duty vehicles by 2035. Earlier in
January, GM CEO Mary Barra pledged the company would be carbon
neutral by 2040. Stellantis, which owns Fiat Chrysler and
Europe-centric brands such as Peugeot, Opel, and Vauxhall, said on
29 January it will debut 10 EV and hybrid models by 2025.
Biden, meantime, said he intends to redirect future US fleet
vehicle purchases to just be EVs, as part of a "Buy America" executive order.
This could result in more than 650,000 light-duty vehicles and
trucks going electric over a number of years.
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