Ford Motor Company has announced a new partnership with Chinese battery maker Contemporary Amperex Technology (CATL) to build a new battery factory in the United States. The factory, which will be built in Tennessee, will produce batteries for Ford’s electric vehicles starting in 2025.
The announcement comes as the demand for electric vehicles continues to grow in the United States, with electric vehicle sales expected to grow from 2% of all vehicles sold in 2020 to 30% by 2030. However, the production of batteries remains a major challenge for the industry, as they require rare earth minerals and other critical materials, most of which are produced in China.
The new battery factory, which will have an annual production capacity of 75 gigawatt-hours (GWh), will help Ford address these concerns by establishing a local supply chain for battery production. The facility will create over 5,000 new jobs in the United States, including 2,300 direct jobs at the factory and an additional 2,700 jobs in the local area. The facility will also create an additional 10,800 jobs in the supply chain and broader economy.
“Establishing a local supply chain for battery production is critical for the success of electric vehicles in the United States,” said Jim Farley, Ford’s CEO. “This partnership with CATL will help ensure that we have a secure supply of batteries for our electric vehicles, while also creating jobs and driving economic growth.”
The partnership with CATL will allow Ford to leverage CATL’s advanced battery technology and manufacturing expertise. CATL is the world’s largest supplier of lithium-ion batteries for electric vehicles and has been working with Ford in China since 2018.
“CATL is committed to working with Ford to bring our leading battery technology and manufacturing capabilities to the United States,” said Robin Zeng, Chairman of CATL.
The new battery factory is a significant step for Ford, which is investing more than $30 billion in electrification by 2025. The company has already introduced several electric vehicles, including the Mustang Mach-E, F-150 Lightning, and the E-Transit.
The facility’s location in Tennessee was chosen because of its central location and access to a skilled workforce. The state’s government has also been supportive of the company’s plans, providing tax incentives and other support.
“The new battery factory will create good-paying jobs for our citizens and help position our state as a leader in the transition to electric vehicles.”
The partnership between Ford and CATL is a positive development for the electric vehicle industry, which has been growing rapidly in recent years. With the demand for electric vehicles expected to continue to rise, partnerships like this will be critical to ensuring a sustainable and secure supply chain for batteries.
However, the partnership has also raised concerns about the potential risks of partnering with a Chinese company. The Chinese government has been accused of unfairly subsidizing its companies and engaging in intellectual property theft. Some experts have also raised concerns about the security of the supply chain and the risk of dependence on Chinese companies.
In response to these concerns, Ford has emphasized the importance of establishing a local supply chain and sourcing raw materials from the United States and other countries. The company has also pointed to the rigorous due diligence process it has undertaken in selecting a partner.