Ford Fumbles

In football, the momentum can turn in an instant. Everything is going along well for the offense and it looks like they are about to score…and then there’s a fumble and the whole game shifts! 🏈

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Sometimes markets are like that, too. A great example is electrical vehicles (EVs). ⚡ There’s been a major shift in Ford’s plans for the new EV battery plant in Marshall. Ford made some pretty big promises that are now being rolled back, so let’s see what’s happening with this fumble!

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Here are Five Fast Facts on Ford’s Fumble:

1. 📉 The Jobs Fumble - The original promise was for the plant to create 2,500 jobs. Now the plan is just 1,700. Is it another case of politicians being politicians?

2. 🪫 The Capacity Fumble - The plant was supposed to create 35 gigawatt hours of battery capacity each year, but that’s now being cut by 43%, down to 20 gigawatt hours. That’s a lot more than the 1.21 gigawatts it takes to power a time machine!

3. 🚙 The Count Fumble - All that battery capacity being cut means far fewer car batteries will be made! The promised number was enough batteries for 400k EVs. Now just 230k EV batteries will be made there each year.

4. 🤔 The Drivers - There are several reasons for Ford’s fumble on this plant. The results of the recent strike are driving up labor costs, interest rates are making cars more expensive in general, and…well, people just aren’t buying many EVs. 

5. ⚖️ The Balance - Automakers are in a bit of a bind. If they overinvest in EV tech and the demand doesn’t pan out (which it isn’t), then they’ve spent loads of cash on things no one wants. If they underinvest, then they can’t keep up with the demand when it arrives (though to be honest, that doesn’t look likely anytime soon unless costs come down)! Ford has lost $1.3 billion on EV investments in the last three months alone! But it’s not just Ford - the entire EV industry is losing money every year.

🔥Bottom line: This is the problem when you have the government forcing increased supply into the market without actual demand to buy them. It’s bad for the companies making the product and it’s bad for the customers who are supposed to be buying the product. Don’t get us wrong - we’ll take those 1,700 jobs for our state! The problem is that if the demand for EVs stays low then it’s not sustainable so it ultimately won’t last.

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You might say the real fumble comes from the government who is pushing all of this, huh?

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What do you think about EVs as an investment for Michigan?

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