- Ford Motor Co. cut back its aggressive EV plan on Monday.
- After years of losses — including $13 billion over two years — it will make fewer and cheaper EVs while expanding gas models and hybrids.
- It also will start an energy storage division, and plans to make household devices alongside some EV batteries at its new factory in Marshall.
A planned battery factory in Marshall that Michigan taxpayers are heavily subsidizing will dramatically shift production, after Ford Motor Co. drastically downsized its electric vehicle ambitions Monday.
The planned $3.5 billion BlueOval Battery Park Michigan in Marshall now plans to produce residential batteries, as the automaker is canceling production of larger, more expensive EVs — including the all-electric F-150 Lightning, produced at the Rouge complex in Dearborn — because of losses, grim sales forecasts and regulatory changes.
After years of struggling to profit from EVs, Ford will record a $19.5 billion hit in the fourth quarter from its investments in the technology. The manufacturer lost $13 billion on EVs since 2023, the Wall Street Journal reported.
The company’s new plans include shifting gears from automotive production to battery storage business that could power everything from household solar systems to data centers. It also plans to produce smaller, less expensive EVs and hybrids.
“This is a customer-driven shift to create a stronger, more resilient and more profitable Ford,” Ford president and CEO Jim Farley said Monday. “The operating reality has changed, and we are redeploying capital into higher-return growth opportunities.”
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Among them, Farley said, are “high-margin opportunities like our new battery energy storage business.”
Farley has acknowledged that the end of a federal $7,500 tax credit for electric vehicles this fall significantly reduced demand.
Ford’s strategy shift could hit Marshall, where Michigan awarded the automaker $2 billion in incentives in 2023 in return for a promise to create 2,500 jobs.
The initial hiring promises changed later in 2023, when EV sales slowed and Ford announced plans to trim the job count to 1,700. The state shaved $600,000 from its spending on the site, but had already purchased the land for hundreds of millions and committed to road reconfiguration and other costs.
So far, 100 people are working at Ford in Marshall, mostly in administrative roles at the site, according to documents Bridge obtained from the Michigan Economic Development Corp. through the Freedom of Information Act.
The MEDC told Bridge Michigan it did not yet have information on Ford’s incentive award and whether more changes could be coming to the taxpayer funding paying for a portion of the project.
After delays, it has been scheduled to open in 2026.
Meanwhile, the project remained controversial among some residents and people critical of the steep spending. Litigation remains in progress.
Ford did not disclose its production capacity goals for Marshall, but said the smaller energy cells it will make there will be used for household uses.
At the same time, the plant “remains on track to begin manufacturing LFP prismatic battery cells in 2026 to power Ford’s upcoming midsize electric truck,” Ford said Monday.
By 2030, Ford said it expects approximately 50% of its global volume will be hybrids, extended-range EVs that have gas backup systems and fully electric vehicles, up from 17% in 2025.
The moves announced by Ford are “quite necessary,” said Glenn Stevens, executive director of MichAuto statewide auto advocacy organization.
The decisions, Stevens told Bridge, represent a “massive strategic pivot to back away from investments that will not provide return and deploy capital, resources and talent where it will.”
Ford had inspired massive shifts to Michigan’s economic development strategy in 2021, when it announced a $13 billion plan to build EV battery campuses in Kentucky and Tennessee.
State lawmakers reacted with shock that Michigan wasn’t considered, then united with Gov. Gretchen Whitmer to create the $2 billion Strategic Operating and Attraction Reserve (SOAR) fund to underwrite large-scale investment.
The campus in Kentucky, Ford said Monday, will be repurposed “to serve the rapidly growing battery energy storage systems market.”
And the planned EV campus in Tennessee will be renamed the Tennessee Truck Plant. It will produce all-new gas-fueled truck models starting in 2029.
SOAR, meanwhile, underperformed on job promises so far, prompting legislators to de-fund the incentive in this year’s budget.
Three other large-scale EV battery deals in Michigan — with Gotion Inc., Our Next Energy and General Motors — also have struggled. Gotion is in default on its SOAR award, while Our Next Energy and the GM plant, now under control of LG Energy Solution, also have shifted toward energy storage from EV batteries.
EVs represent about 4% of all vehicles on Michigan roads.
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