Ford To Spend US$11.4 billion On Electric Vehicle Mega Campus

5 minute(s) Read

October 6, 2021

Daniel Foelber

Last Monday, Ford announced plans to build Blue Oval City, a 6-square-mile complex in west Tennessee that will underpin the company’s electric vehicle (EV) production. Additionally, Ford announced plans for three new BlueOvalSK battery plants — two in Kentucky and one in Tennessee. The plants will enable 129 GW hours a year of US production capacity. The Tennessee campus is estimated to cost US$5.6 billion and create approximately 6000 new jobs while the Kentucky-based battery complex is estimated to cost US$5.8 billion and create 5000 jobs.

Ford’s EV push

For years, the electric vehicle (EV) pickup truck industry has been quiet. Sure, we’ve heard a peep from a Tesla Cybertruck here. A whisper from a Rivian truck there. But nothing from a legacy automaker with decades of truck production under its belt.

That is, until Ford dropped an absolute bomb with the F-150 Lightning, which also comes in Platinum, Lariat, and XLT. The new all-electric models will be available starting in spring of 2022.

The F-150 Lightning builds upon Ford’s F-Series line, which has been the best-selling truck in the United States for 44 years. The F-150 Lightning is targeting a range of 300 miles (483 km), 563 horsepower, and 775 lb.-ft. (1051 nm) of torque, which would give it the highest torque of any F-150 ever. For comparison, even the highest rated 2020 F-150 engine, the 5-liter V8, had just 400 lb.-ft. (542 nm) of torque at 4500 rpm.

The pre-production model with available features of the 2022 Ford F-150 Lightning. Ford notes that cargo and load capacity are limited by weight and weight distribution. (Image Courtesy Of Ford Motor Company)

EVs made up just 8% of Ford’s July sales, but demand has never been stronger. Reservations for the Ford F-150 Lightning now exceed 150,000 units. Ford’s Mustang Mach-E SUV is so popular Ford literally can’t make them fast enough to satisfy demand. It’s vehicles like these that Ford plans to build at its Blue Oval City campus. Constructing a designated place to innovate and scale vehicles proves that Ford is serious about its EV push.

A ‘Vertically-Integrated Ecosystem’

Ford and its partner SK Innovation plan to make Blue Oval City a carbon-neutral, vertically integrated ecosystem. Once fully operational, Ford said the plant will produce net-zero waste by capturing and sorting scrap materials on site. Recycling and processing are expected to eventually happen on site but could happen off-site for the time being. The Tennessee facility will use what Ford dubbed “always-on cloud connected technologies,” which it believes will improve the quality and productivity of its plant. The company also plans to use wind energy, solar power, and geothermal solutions to power the plant. “West Tennessee is primed to deliver the workforce and quality of life needed to create the next great American success story with Ford Motor Company and SK Innovation,” said Tennessee Governor Bill Lee. “This is a watershed moment for Tennesseans as we lead the future of the automotive industry and advanced manufacturing.”

The pre-production model with available features of the 2022 Ford F-150 Lightning Platinum, Lariat, and XLT. (Image Courtesy Of Ford Motor Company)

Blue Oval City will also house an on-site wastewater treatment plant so that the facility makes zero freshwater withdraws. It will also incorporate water reuse and recycling programs.

“Blue Oval City’s assembly plant will harness Ford’s global manufacturing expertise and cutting-edge technologies to deliver cost efficiencies and the quality that our customers expect,” said Kumar Galhotra, Ford president, Americas & International Markets Group. “This will enable Ford to lead in the race to bring dependable, affordable, and advanced EVs to even more Americans.”

BlueOvalSK Battery Park

The neighboring battery park in Kentucky will help localize the supply chain and concentrate Ford’s EV operations. “This is a transformative moment where Ford will lead America’s transition to EVs and usher in a new era of clean, carbon-neutral manufacturing,” said Ford Executive Chair Bill Ford. “With this investment and a spirit of innovation, we can achieve goals once thought mutually exclusive — protect our planet, build great EVs Americans will love, and contribute to our nation’s prosperity.” Ford also plans to create a battery recycling program to promote ESG objectives. The company is partnering with RedWood Materials to localize its supply chain and use scrap materials for end-of-life vehicles. Ford believes that lithium-ion battery recycling is critical for both sustainability and long-term profitability.

The twin co-located battery parks will each be able to produce 43 GW annually. “We thank Ford Motor Company and SK Innovation for their investment in Team Kentucky,” said Kentucky Governor Andy Beshear. “This is the single largest investment in the history of our state and this project solidifies our leadership role in the future of the automotive manufacturing industry. It will transform our economy, creating a better Kentucky, with more opportunities, for our families for generations. Our time is now. Our future is now.”

Training

In addition to the two plants, Ford announced a technical training program that will go toward educating a new generation of EV technicians. Ford aims to scale the program as it increases its EV investments. Ford is investing a total of US$525 million in the technical program, of which US$90 million is in Texas alone.

Takeaways

According to Ford, the investment is the largest ever EV manufacturing investment at a single point by any US automaker in history. Last Monday’s announcement, Ford confirmed it was on track to invest more than US$30 billion in EVs through 2025. Ford also expects between 40% to 50% of its global vehicle volumes to be fully electric by 2030.

“This is our moment — our biggest investment ever — to help build a better future for America,” said Jim Farley, Ford president and CEO. “We are moving now to deliver breakthrough EVs for the many rather than the few. It’s about creating good jobs that support American families; an ultra-efficient, carbon-neutral manufacturing system; and a growing business that delivers value for communities, dealers, and shareholders.”

“We are proud to be partnering with Ford as they open a new chapter in automobile history,” said Dongseob Jee, president of battery business at SK Innovation. “We are excited to be taking this decisive leap together, as partners, and to bring about our common vision for a cleaner planet. Our joint venture, BlueOvalSK, will embody this spirit of collaboration.”