Tiny Marshall, Mich., is steeped in history. Once a candidate to serve as Michigan’s state capitol (it lost out to Lansing, about an hour north), it today draws tourists who flock to its picturesque streets to shop, dine, and view its elegant vintage homes, recalling places like Concord, Mass., and towns on Cape Cod.
A 10-minute drive west from its town square, Marshall could now be making history in another way.
On 1,500 acres of former farmland, the frame is rising for Ford Motor’s Blue Oval electric battery plant, named after the company’s famous logo. City officials believe the plant will diversify the economy and attract newcomers to the town of just under 7,000, whose population has been stagnant despite Marshall’s beguiling appearance.
“There’s the danger if you’re not fighting for economic development, the community will continue to decline and young people will leave,” says James Durian, chief executive of the Marshall Area Economic Development Alliance.
There’s a big risk, however: When it comes to new car-battery factories, Marshall has plenty of competition.
Across the United States, TechCrunch says, at least $100 billion has been invested or promised for EV battery plants, stoking economic development dreams from Michigan to Texas, from the Carolinas to Nevada and California.
The investments will create the capacity to produce 18 million battery packs per year. In total, TechCrunch estimates the plants will employ nearly 65,000 people.
The surge is due in part to generous tax credits in the Inflation Reduction Act of 2022, but economic development agencies have been chasing battery investments for much of the past decade, hoping to give their communities an edge on the technology of the future.
Now EV battery plants have become to the 2020s what international car plants were from the 1980s through the 2000s: billion-dollar investments providing thousands of jobs.
But the perils are already apparent — the main one being Americans’ reluctance to commit to electric vehicles.
Marshall is a case in point.
When the United Auto Workers struck Ford for six weeks last fall, the carmaker halted construction on the battery plant. When the strike was over, Ford pushed back the launch of the Marshall plant, one of three battery plants it plans to open, and reduced its expected workforce, blaming weaker than expected demand for EVs. Then, in April, Ford slashed production of the F-150 Lightning electric pickup and pushed back the introduction of a new electric SUV it plans to build in Canada.
Marshall officials know there are no guarantees. “We’re all at the whim of the economy and electric vehicles,” Durian says. But he adds, “I believe the future is electric vehicles.”
His confidence is echoed in Liberty, N.C., where Toyota has begun hiring workers for its own vast battery complex. It will have 10 production lines, employing 5,100 people in a high-tech clean-room environment. In addition to making batteries for electric cars, it will make batteries for hybrid vehicles — those powered by both batteries and gasoline engines.
Since its initial announcement in 2021, Toyota has boosted its Liberty investment twice, going from $1.9 billion to nearly $14 billion. It will be the sole battery supplier for Toyota’s hybrid vehicles made in North America, including the top-selling Toyota Camry sedan, which will only come as a hybrid, and 13 other models.
By 2030, company officials think, about 30 percent of Toyota’s US sales will be EVs, says Sean Suggs, president of the North Carolina venture.
And yet that’s a more conservative estimate than Detroit companies originally voiced. The CEO of General Motors, for example, once boldly declared that her carmaker would go entirely electric by 2035.
“We’re getting ready for what the customer is asking for,” Suggs says. “We know the customer isn’t asking for all EVs yet.”
Battery plants are something of a consolation prize for North Carolina. The state pushed hard to win a Toyota-Mazda joint venture factory, only to lose out to Alabama in 2018. When officials heard that Toyota was going to build batteries in the United States, they shifted their focus to landing the factory.
“They’re making the gasoline of the future,” says Brent Christensen, president of the chamber of commerce in nearby Greensboro, who helped lobby for the plant. “We knew it was going to be big numbers.”
However, those numbers might be too big, too optimistic. The Environmental Defense Fund, an advocacy group, says the national capacity for 18 million battery packs will far exceed the 10 million it estimates will be needed to power all the vehicles that have been announced for the US market. There are 30 plants under construction now, and new investments are still being announced. And there are plants abroad that could serve the US market. Honda recently said it plans to spend $11 billion on a factory for EVs and batteries in Canada, where Volkswagen has also made a major battery investment.
So there’s still a crucial selling job required. Although 2.5 million EVs are now in use in the United States, that’s less than 1 percent of the 282 million vehicles registered here. What’s more, many people seem unconvinced that their next car will be something that plugs into a charger. A survey by the Gallup Organization found that only 35 percent of respondents might consider buying an EV in the future, down from 43 percent a year ago. And the proportion of people who say they’d never buy one jumped to 48 percent from 41 percent in 2023.
Even as they clear farmland, announce more investments, and tout future electric vehicles, carmakers have a parallel task in making sure the batteries built in these plants find a home under a hood. Communities everywhere depend on their success.
This story was updated on May 13 to correct the description of what will be supplied by Toyota’s North Carolina battery factory.
Micheline Maynard is the author of “The End of Detroit: How the Big Three Lost Their Grip on the American Car Market.”