2023-11-21 12:52:31 ET
Ford Motor Co (NYSE: F) is dialing down on its previously announced plan for a battery plant in Michigan. Its shares are in the red at writing.
Ford wants to cut costs
The legacy automaker says it will no longer invest $3.5 billion in the BlueOval Battery Park Michigan that was supposed to employ 2,500 in total and produce 35 GWh of batteries per year.
Ford now expects that facility to create 1,700 jobs only and produce 20 GWh of batteries annually.
The news arrives about a month after the multinational revealed plans of delaying its planned investments in electric vehicles by about $12 billion.
Electric vehicles need to be more than just eco-friendly – they have to be better than their gas-powered alternatives. Hear more of my #EV POV in my TED talk: https://t.co/tGdlUKVV6n @TEDTalks @TEDCountdown
— Cynthia Williams (@CWilliams_Ford) November 17, 2023
Reason cited for today’s announcement include muted demand for electric vehicles amidst higher costs and issued related to battery technologies and supply chain at large.
Ford authorises stock repurchase
Ford still expects to be producing LFP batteries for electric vehicles based on technology licensed from China-based CATL at the Michigan factory by 2026.
On Tuesday, the New York-listed firm also authorised a repurchase of up to 51 million shares.
The buyback is expected to “offset the dilutive effect of share-based compensation granted during 2023”, as per its filing with the Securities & Exchange Commission.
Last week, unionised workers at Ford Motor Co ratified its deal with the United Auto Workers after intense negotiations that went on for about two months ( find out more ). Wall Street currently has a consensus “overweight” rating on shares of the Detroit automaker that are down more than 30% at writing.
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