Representation of Ford’s $ 5.6 billion “Blue Oval City” campus in Tennessee. The site is expected to include a supplier park, a battery production facility, and a new F-Series electric truck assembly plant.
DETROIT – Ford Motor and battery supplier SK Innovation plan to invest more than $ 11.4 billion in new facilities in the US that will create nearly 11,000 jobs to produce electric vehicles and batteries.
Ford is building twin lithium-ion battery plants in central Kentucky through a joint venture with South Korea-based SK. called BlueOvalSK as well as a massive 3,600-acre campus in western Tennessee, the automaker said Monday night. The campus will include another SK-built battery plant along with a supplier park, recycling center and a new assembly plant for F-Series electric trucks, Ford CEO Jim Farley told CNBC.
The plans are the latest from Ford to increase development and production of electric vehicles, including batteries, under Farley, who began to lead the automaker a year ago this week. They also reinforce President Joe Biden’s call for companies to supply chains on the ground amidst a global shortage of semiconductor chips which has affected several industries, including automotive.
Investment is part of Farley “Ford +” Restructuring Plan to capitalize on the automaker’s traditional operations and better position it for emerging sectors such as autonomous, electric and connected vehicles.
“This is the new Ford,” Farley told CNBC during a telephone interview. “Now is the time. We are putting shovels in the ground, 11,000 new workers … It is a huge commitment to build these digital products.”
Ford does not expect to take on any additional debt to fund the plans, according to Farley. He said the moves will be financed out of company profits.
The new investment adds to the $ 30 billion The company previously said it would go towards electric vehicles through 2025, of which about $ 7 billion had already been invested by February.
Production at the plants, other than one of the battery plants in Kentucky, is expected to begin in 2025, the company said. The second battery plant in Kentucky is expected to go online in 2026, according to Ford.
The “new Ford” is a drastic twist from Farley’s predecessor Jim Hackett, who previously said the automaker saw “no advantage” in the production of its own battery cells. Comes like Ford’s rival in town General motors spend $ 4.6 billion through a joint venture with Lg chem for battery production, starting in 2023.
Farley said the investment should be further proof that Ford, which many on Wall Street believed was lagging behind in EVs, is positioned to be a leader in the segment. “I don’t know of any other company that has made this announcement. Why would you think we are behind? We are ahead,” Farley said.
Ford’s shares have more than doubled since Farley became CEO of the automaker nearly a year ago.
Approximately $ 5.6 billion of Ford’s investment with SK will go to a new campus called Blue Oval City in Stanton, Tennessee and $ 5.8 billion for the two factories in Glendale, Kentucky. Ford will cover about $ 7 billion of the $ 11.4 billion, according to Lisa Drake, Ford’s director of North American operations.
“This is a really crucial moment for us and our country today,” Drake told reporters during a call. “We are announcing the largest single investment in new manufacturing facilities in Ford’s 118-year history.”
The three new BlueOvalSK plants will allow 129 gigawatt hours a year of US production capacity for Ford, enough to power 1 million electric vehicles a year, Ford icials said. That’s more than half the electric vehicle production capacity that Ford expected to have globally by 2030.
“This is truly an amazing project, and one that speaks to Ford’s ambition for America’s fast-growing electric vehicle industry,” SK Innovation Global Marketing Director Yoosuk Kim said during a call.
Ford expects the new vehicle manufacturing plant in Tennessee to be carbon neutral once fully operational, including zero-waste processes at landfills.
Farley said the plant will build new F-Series electric trucks. He added that the next-generation trucks will be exclusively designed to be electric vehicles, as opposed to electric trucks. next F-150 Lightning which is based on the traditional pickup with internal combustion engine.
Ford has begun initial pre-production of its F-150 Lightning electric pickup truck at a new plant in Dearborn, Michigan.
Michael Wayland | CNBC
“We are going to build an all-electric bottom-up optimized product platform at this plant. It will be the largest plant in our company’s history,” said Farley. “We are going to build a lot of great F-Series electric vehicles there. We are not going to be specific about which type.”
Farley said the company is “reinventing what a truck would look like,” including the range, with this announcement. Drake said Ford expects a third of the full-size pickup trucks sold in the United States to be fully electric by 2030.
Ford’s current F-Series lineup includes the F-150 and larger versions of the full-size pickup, as well as medium-duty pickups and chassis cabs designed for commercial buyers.
Farley and Drake compared the importance of the new electric vehicle plants to the mass production of the Model T by company founder Henry Ford, which made the vehicles more affordable and accessible to the general public.
Ford previously said it expected at least 40% of its global sales to be electric vehicles by the end of this decade. The goal was announced before the Biden administration set a goal. last month for half of all new car sales to be electric vehicles, including plug-in hybrid models, by 2030
In addition to the manufacturing facilities, Ford said it plans to invest $ 525 million over the next five years, including $ 90 million in a pilot program in Texas, to train trained technicians to repair electric vehicles.
“This is just the beginning of our aspirations to lead America in the next century of sustainable transportation economics,” said Drake. “This investment is catapulting us forward to lead the electric revolution.”
The Mustang Mach-E is Ford’s first fully electric vehicle under an $ 11 billion investment plan in electrified vehicles through 2022.
Michael Wayland | CNBC