ROMULUS, Mich. (WOOD) — The state on Tuesday reduced the incentives it’s giving the Ford Motor Company after the carmaker reduced the size of an electric vehicle battery plant it’s building in the Marshall area.
Construction on the BlueOval Battery Park facility in Romulus near Marshall is more than 20% complete, Ford said in a Tuesday release. When it was first announced, the project was set to be a 2.5 million-square-foot plant that would create 2,500 new jobs and bring in $3.5 billion in capital investment.
Following a September pause spurred by the United Auto Workers strike, Ford in November said it was moving ahead with the project, but at a reduced scale. Now set to be a 1.8 million square-foot plant, the BlueOval Battery Park facility is expected to create 1,700 to 2,100 jobs and will bring in a $2.5 billion to $3 billion investment, according to a memo from the Michigan Economic Development Corporation.
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Tony Reinhart, Ford’s director of state and local government affairs, told the Michigan Strategic Fund board during its meeting Tuesday that the project is on track to begin production in 2026.
He said Ford saw a 61% increase in EV sales in the second quarter, and a 72% increase for the year. But the speed of EV growth has slowed and “fallen short of industry expectations,” the MEDC memo says.
“We’re going through a lot of change. The rapid transformation of the auto industry is real and continued. We’re going through as much change as we’ve seen since our inception in the industry itself,” Reinhart told the board.
The Michigan Strategic Fund on Tuesday approved a revised incentives package in response to the changes. A Critical Industry Program grant has been dropped from up to $210 million to a minimum of $141 million and a maximum of $166 million.
The state also removed a Renaissance Zone for the project, which was worth around $772.8 million, and added a State Essential Services Assessment Exemption, which is worth around $18.5 million. A State Education Tax Abatement was increased from around $52.1 million to around $224.6 million.
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All told, the incentives from the state has been decreased from around $1.03 billion to a minimum of $384.1 million and a maximum of $409.1 million. Ford’s expected economic impact over five years, which includes investments in the project and wages, has been decreased from around $4.06 billion to a minimum of $2.9 billion and a maximum of $3.5 billion.
During the meeting Tuesday, MSF Board members praised MEDC team members, saying the new incentives package is favorable toward the state.