Compiled / Ma Xiaolei
Edited / Meng for
Design / Zhao Haoran
Source / Financial Times, by Claire Bushey
Four years later, cotton and soybeans from a farmland in western Tennessee would be turned into Ford's electric pickup trucks.
In September, Ford and its partner SK Innovation said they would invest $11 billion to build an electric vehicle assembly plant, battery plant and supplier park on farmland 50 miles northeast of Memphis, and two battery plants in neighboring Kentucky.
Ford and SK Innovation plan to build a battery and electric vehicle complex in Tennessee (renderings).
Towns, states and regions in the United States are scrambling to attract new EV factories. Ford's campus in Tennessee will be known as the "Blue Oval City," in the mouths of Heywood County Governor David Livingston, a place that has been losing population since World War II.
"Electric vehicles are the trend of the future." Livingston said.
The automotive industry is vital to the U.S. economy. In 2020, it accounted for 3% of the U.S. gross domestic product, employing more than 900,000 people in vehicle and parts manufacturing, and another 200,000 people in sales jobs. The average annual salary is $84,000, which is $20,000 higher than the average for all industries in the United States.
However, the distribution of dividends in the automobile industry is not even. Beginning with Henry Ford's production of T models in southeastern Michigan, automakers and their supply chains have historically been concentrated in the Midwest.
In the 1970s and 1980s, as U.S. automakers opened factories in southern states, economic benefits began to spread widely. Japanese and German automakers have followed suit.
Today, starting in Michigan, a car "Silk Road" is formed from north to south, with well-run auto manufacturing divisions in the southern regions of Kentucky, Tennessee, and Alabama.
As electrification grows across the industry, cities and states are competing to maintain their share of economic benefits or win a bigger pie.
The Michigan State Commission, formed by Gov. Gretchen Whitmer, said in a 2020 report that while the state remains a global leader in electric and self-driving car technology, "our lead is already shrinking."
A number of competitors are eyeing Detroit's title of "Motor City". Tennessee has provided Ford with $500 million in incentives, while Officials in Kentucky expect the company to apply for $286 million in waivable loans and skills training.
Brett Smith, technical director at the Center for Automotive Research (CAR), said the states that missed Ford's new plant are now "rethinking."
"Those are two very, very big investments." He was referring to factories in Tennessee and Kentucky.
The addition of Ford's new campus will increase the number of electric vehicle plants in Tennessee to four. Nissan has been producing Leaf electric vehicles there since 2017, Volkswagen plans to produce ID.4 electric SUVs there, and GM said in 2020 it will spend $2 billion to convert the spring Hill plant in the state into an electric vehicle plant.
Kristin Dziczek, CAR's senior vice president of research, believes that when automakers decide where to build electric vehicles, their main considerations are "land, cost, labor and supply chain." ”
Large, immediately operational sites are important. Tennessee public and private sector officials began cobbling together the 4,200-acre site That Ford finally chose almost two decades ago, buying land from 26 owners.
Lisa Drake, Ford's North American chief operating officer, said the company chose Tennessee and Kentucky because of their proximity to Ford's other plants and suppliers, access to sustainable energy, and lower construction and operating expenses, which are key to keeping batteries low.
Gregory Keoleian, director of the Center for Sustainable Systems at the University of Michigan, agrees that electricity is an important cost in making batteries for electric vehicles, even though it is insignificant compared to the cost of projects such as lithium, cobalt and battery modules.
According to the U.S. Energy Information Administration, industrial electricity in Michigan is priced at 7.2 cents per kilowatt-hour, compared with around 5.3 cents in Kentucky and Tennessee.
The federal government's Tennessee Rivers Authority (TVA), which supplies most of the state's electricity with nuclear and hydroelectric power, is a big draw for automakers looking to reduce carbon emissions in their production processes.
Industry observers note that THE TVAs, created during the Great Depression to ward off floods and power rural communities, gave Tennessee an advantage in other ways.
In 2018, Tennessee's electric vehicle registration rate was less than one-in-a-thousandth, and today, the state is building a network of fast-charging stations with one every 50 miles along the main road.
Kim Hill, president of consultancy HWA Analytics, said: "This is a very good thing for manufacturers. ”
For a long time, Midwestern states have been vying to become bridgeheads for electric vehicles, attracting automakers to invest heavily. Car's data shows that between 2018 and 2020, automakers invested more than $8 billion in electric and self-driving cars in Michigan, $2.5 billion in Ohio and $304 million in Indiana.
CAR estimates that by 2030, the Northern Midwest region of the United States will produce a large number of U.S. electric vehicles, of which Michigan, Ohio and Indiana will produce 30% of the cars. The southern United States will produce 45 percent of electric vehicles, and its manufacturing footprint will cover eight states.
Meanwhile, Haywood County, Tennessee, is working on a new water and sewer pipeline plan to serve the Ford campus and the businesses and residents expected to emerge around it.