Opposition Mounts Against Ford’s EV Battery Plant Using Chinese Tech

Sen. Joe Manchin (D-W. Va.) on Capitol Hill in Washington on May 4, 2022. Nicholas Kamm/AFP via Getty Images

Politicians and local residents are voicing opposition to Ford’s new electric vehicle (EV) battery plant in Michigan over the automaker’s partner, which has links to the regime in China.

In February, Ford announced it would build a battery park in Marshall, a small township 100 miles west of Detroit, under a licensing agreement with Chinese firm Contemporary Amperex Technology Co. Ltd. (CATL), the world’s largest producer of EV batteries.

The facility will start operating in 2026 and be a wholly owned subsidiary of the U.S. company. CATL will provide the battery technology, some equipment, and workers, Ford said.

The deal, which gives the plant access to tax credits under the Inflation Reduction Act (IRA), has drawn criticism from federal lawmakers who say U.S. taxpayers shouldn’t fund a China-linked project.

Meanwhile, local residents are protesting over concerns about the infiltration of the Chinese Communist Party (CCP) and the loss of prime farmland.

C Drive North on March 11, 2023. The farmland on the other side of the street is the site slated for the new Ford electric vehicle battery park. NTD

Late last year, before Ford selected the site in Michigan, Virginia Gov. Glenn Youngkin withdrew his state’s bid for site consideration over national security concerns.

Controversial Deal

The plant will produce lithium-iron-phosphate batteries, better known as LFP, a type of battery thats cheaper but less energy-dense than the nickel-cobalt-manganese battery that currently dominates the global market. CATL is known for its expertise in LFP battery technology.

Ford’s introduction of LFP in its entry-level models takes the Chinese-monopolized technology one step closer to global dominance in the EV battery market, according to a December report by Adamas Intelligence, a critical minerals market research firm.

The deal will give a significant additional boost to CATL, which rose to prominence with the help of $155 million in Chinese subsidies between 2015 and 2017, a time during which foreign providers had no access to the Chinese EV battery market.

On the same day as the Ford announcement, Sen. Marco Rubio (R-Fla.) wrote a letter to the Treasury, Energy, and Transportation secretaries, asking for a Committee on Foreign Investment in the United States (CFIUS) review of the Ford–CATL licensing agreement. CFIUS is a federal interagency panel tasked with assessing foreign investments for national security risks.

Rubio said he wanted to ensure no taxpayer dollars would “go to enrich [China’s] national champion CATL, or any other Beijing-supported company, directly or indirectly.”

Proximity to Military Sites

In addition to the concern that CATL plays a strategic role in achieving Beijing’s national industrial plan, known as “Made in China 2025,” the EV plant is located near sensitive military units.

The Battle Creek Air National Guard Base is about 15 miles from the intended battery park site, which is heavily marketed as a “megasite” by the Michigan state economic development agency. The base hosts a ground control station that supports U.S. missions of the MQ-9—an armed, remotely piloted drone aircraft—providing intelligence to federal and state entities.

An MQ-9 Reaper flies a training mission over the Nevada Test and Training Range, on July 15, 2019. MQ-9 aircrew provide dominant, persistent attack and reconnaissance for combatant commanders and coalition partners across the globe. Airman 1st Class William Rio Rosado/U.S. Air Force

The Hart-Dole-Inouye Federal Center, a defense logistics center, is within 10 miles of the megasite. Ford will initially use 950 acres of the 1,600-acre site and has an option to expand.

“I feel that the placement of this site is no accident; it is an effort by the CCP to gain access to our base," Rick Sadler, a Marshall resident who lives a half-mile from the site, previously told The Epoch Times. “Our national security is at risk. But, apparently, it’s okay with Ford, the local government, and the state government.”

The public affairs office of Battle Creek Air National Guard Base told The Epoch Times that the base couldn’t comment on the business practices of private companies. It didn’t disclose whether it was informed of the deal before the public announcement.

The base reports to Michigan’s governor. The U.S. Department of Defense and Gov. Gretchen Whitmer’s office didn’t respond by press time to a request for comment.

Manufacturing Tax Credits

Ford previously confirmed that it expects the new EV plant to qualify for the $45 per kilowatt-hour advanced manufacturing tax credit under the IRA.

Given the factory’s annual capacity of 35 gigawatt-hours, or 35 million kilowatt-hours, Nick Iacovella, a spokesperson for the Coalition for a Prosperous America (CPA), estimated that the total tax benefit for the plant could reach $1 billion, depending on the exact terms of the licensing agreement. CPA is an advocacy organization that represents exclusively domestic producers, according to its website. Ford isn’t a member of the CPA.

On March 9, Rubio, the top Republican on the Senate Intelligence Committee, introduced a bill to block U.S. subsidies to Chinese battery companies. If enacted, Ford’s new EV battery plant that licenses a Chinese battery maker’s technology wouldn’t qualify for EV tax credits under the IRA.

Sen. Marco Rubio (R-Fla.) speaks at the Heritage Foundation in Washington on March 29, 2022. Drew Angerer/Getty Images

In response, Ford reiterated that its wholly owned subsidiary would “build, own, and operate” the new battery plant.

“No other entity, including CATL, will receive any U.S. tax dollars for this project. Any suggestion otherwise is incorrect,” a company spokesperson said in an emailed statement.

“By producing these batteries in the U.S.—rather than relying exclusively on foreign imports, like other auto companies do—we’ll create thousands of good-paying American jobs, contribute significantly to the development of the country’s industrial capability in the transition to electric vehicles, and make EVs more affordable to more customers,”

Consumer Tax Credit

Along with the manufacturing tax credit, buyers of Ford’s EVs made with batteries produced at the Michigan plant will be eligible for the consumer EV tax credit under the IRA. Customers of EV vehicles can receive up to $7,500 in “clean vehicle credit,” with the amount dependent on whether the vehicle, batteries, and battery components are made in and sourced from the United States.

Sen. Joe Manchin (D-W.Va.), chairman of the Senate Committee on Energy and Natural Resources, said on March 10 that he is “totally opposed” to allowing CATL access to U.S. tax benefits. During the CERAWeek energy conference in Houston, he stressed that a 12 percent royalty included in the Ford-CATL deal would send $900 of the $7,500 consumer tax credit to CATL.

“I'll be damned if I’m going to give them $900 out of $7,500, to let it go to China for basically a product we started,” he said.

A day earlier, White House clean energy czar John Podesta said at a policy forum held by the American Council on Renewable Energy, a Washington-based trade group, that Chinese companies would be “big players” generally and would have involvement in the U.S. production of EVs, such as in the Ford–CATL deal.

Manchin was quick to rebuke that.

“It is beyond irresponsible for someone speaking on behalf of the White House to not only condone but also advocate for sending American tax dollars to Chinese companies,” he said in a statement.

Sen. Joe Manchin (D-W.Va.), chairman of the Senate Energy and Natural Resources Committee, presides over a hearing on battery technology in Washington, on Sept. 22, 2022. Kevin Dietsch/Getty Images

“These words are especially concerning as rumors circulate about the Administration thoughtlessly considering opening up the EV credit’s eligibility beyond our free trade agreement partners and allowing the laundering of Chinese minerals and materials through Trojan horse agreements.

“I will do everything in my power to prevent this Administration from welcoming China to take federal dollars with open arms.”

Manchin introduced a bill earlier this year to ensure that EV tax credits be implemented with sourcing requirements of battery components and materials as of Jan. 1. He said the IRA was designed to grow domestic EV battery manufacturing and reduce reliance on China.

Manchin’s proposal for quick passage didn’t gain unanimous consent; the bill is still with the Senate Finance Committee. The Department of Treasury has said it would issue guidance on EV battery sourcing for consumer tax credits this month.

Loss of Farmland

Marshall, a township of about 3,000 people, prides itself on its prime farmland. The township’s website states that it includes approximately 9,000 acres of cropland—“some of the best farmland in Calhoun County”—with corn, soybeans, and wheat its primary crops.

The acres designated for the future EV battery park are also farmland. Ford has said it would place 245 acres at the site’s southern edge in a conservation easement, limiting the land use to protect its conservation values.

“Before we rush to embrace what some refer to as progress, first pause to consider what will be lost when land that has produced literally tons of corn and beans to feed a hungry nation is covered in concrete. It cannot be reclaimed,” a speaker at the township board meeting on Feb. 20 said. “With the entrance of the Ford company, more farmland will inevitably be lost to housing and strip malls.”

Protestors in front of Riverside Farm, a 120-year-old farmstead on the lot slated for the new Ford EV battery park in Marshall, Mich., in February 2023. Courtesy of Seed Keepers

The Marshall Area Economic Development Alliance’s response is that the acres used for the EV battery park are a small fraction of the 10 million acres of farmland in the state.

“We have seen firsthand that communities can increase economic opportunities while preserving and respecting our deep agricultural roots,” the organization stated.

“When you see our farmland being bought up by China, when you see that we’re relying so heavily on a technology from China that has control of lithium deposits around the world, it just doesn’t seem wise to be doing this,” Rebecca Glotfelty, cofounder of local advocacy group Seedkeepers, previously told The Epoch Times.

Seedkeepers was founded as a response to the Ford–CATL plant. The organization is advocating for a state park as an alternative plan for the site. Although she doesn’t currently live in Marshall, Glotfelty grew up on a farm that her parents had sold to the local economic development agency for the Ford plant.

“It’s not like we’re buying a toy from China; we are putting EV batteries in all of our transportation, which is critical to our security.”

A sign calling for stopping the new Ford EV battery plant on the Chapmans' property in Marshall, Mich., on March 7, 2023. Courtesy of Fred Chapman