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Transportation China Government The Almighty Buck United States

Ford Gets $9.2 Billion To Help US Catch Up With China's EV Dominance (bloomberg.com) 82

Posted by BeauHD from the playing-catch-up dept.
The US government is providing a conditional $9.2 billion loan to Ford for the construction of three battery factories, the largest government backing for a US automaker since the 2009 financial crisis. "The enormous loan [...] marks a watershed moment for President Joe Biden's aggressive industrial policy meant to help American manufacturers catch up to China in green technologies," reports Bloomberg. From the report: The new factories that will eventually supply Ford's expansion into electric vehicles are already under construction in Kentucky and Tennessee through a joint venture called BlueOval SK, owned by the Michigan automaker and South Korean battery giant SK On Co. Ford plans to make as many as 2 million EVs by 2026, a huge increase from the roughly 132,000 it produced last year. The three-factory buildout by BlueOval plus an adjacent Ford EV assembly unit have an estimated price tag of $11.4 billion. BlueOval was previously awarded subsidies by both state governments. That means taxpayers would be providing low-interest financing for almost all of the cost.

Ford's cars and SUVs made with domestic batteries will also be eligible for billions of dollars in incentives embedded in the Inflation Reduction Act's $370 billion in clean-energy funding, part of the historic climate measure narrowly passed into law about a year ago. The US government will subsidize manufacturing of batteries, and buyers could qualify for additional tax rebates of up to $7,500 per vehicle.

The rush of incentives, government lending and private-sector investment has led to a manufacturing boom in the wake of the IRA. More than 100 battery and electric-vehicle production projects are announced or already under construction in the US, representing about $200 billion in total investments. "Not since the advent of the auto industry 100 years ago have we seen an investment like that," says Gary Silberg, KPMG's global automotive sector leader.
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Ford Gets $9.2 Billion To Help US Catch Up With China's EV Dominance More

Ford Gets $9.2 Billion To Help US Catch Up With China's EV Dominance

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  • I have some beach front property in Montana I will sell you.

  • Wow (Score:4, Interesting)

    by backslashdot ( 95548 ) on Thursday June 22, 2023 @09:31PM (#63625140)

    I think Elon is a right-wing jerk, but it’s mad unfair that Ford gets this money and Tesla which is years ahead of anyone does not get anything. $9.6 billion .. that’s billion with a fucking B, is a huge god damn amount of money. You could pay the top 1000 engineers and scientists nearly $10 million each with that’s We’d be better off spending it on a collaborative research foundation that spends the money on funding specific research projects for the benefit of any US company such as design tools for advanced robotic manufacturing, battery research, machining/die casting research, things like that. Basically research and development that can feed back into Ford and Tesla. You know how multiple companies contribute to Linux, LTE, and other projects like that.

    • A. Elon wants you (and the right wing) to think that he is one of them, because they would attack him otherwise and make it harder for him to gain success

      B. Ford will be licensing Tesla charging systems, motors, batteries, GPUs and the rest to build their gear, so Elon makes money no matter what

      C. a Billion ain't what it used to be

      D. The US patent system allows for a form of collaboration through competition when companies license their inventions to each other

      E. I would not want to drive a linux distributi

      • Re: (Score:2)

        by quenda ( 644621 )

        A. Elon wants you (and the right wing) to think that he is one of them, because they would attack him otherwise and make it harder for him to gain success

        I thought Elon was more Libertarian, until I saw him doing a podcast/interview with Babylon Bee. He was quite happy to disagree and argue with them.
        They got on well, even when he started telling them that God is not real, and explained the importance of taxes, a strong public sector, and government regulation!
        It turns out he supports strong regulation of space launches and the automotive industry. I'd wrongly assumed otherwise because he complained so much about particular instances he thought were wrong.

        • Re:Wow (Score:4, Insightful)

          by quonset ( 4839537 ) on Friday June 23, 2023 @05:45AM (#63625794)

          and explained the importance of taxes,

          Muck is against higher taxes for billionaires and has said so. [businessinsider.com]

          a strong public sector

          Musk has fought against unionization [npr.org].

          and government regulation!

          Musk is against government regulations [cato.org].

          he supports strong regulation of space launches

          Musk was just rewarded by having legislation passed in Florida which exempts his space company [businessinsider.com] from any liability if the people being launched are injured or killed.

          and the automotive industry.

          Florida just passed regulations prohibiting direct-to-consumer car sales [cbsnews.com], except for EVs.

          Just because somebody whinges a lot about wokeness, it does not mean they are the opposite extreme.

          I have no idea what "wokeness" is, but Musk is out supporting Russia's invasion of Ukraine [cnn.com], promotes lies about vaccines [yahoo.com], and has repeatedly prevented any criticism of him from being on the failing company Twitter or firing people who disagree with him despite saying free speech was a necessity [businessinsider.com].

          Based on the above, either Musk is lying or you're lying. Or both.

          • Re: (Score:2)

            by quenda ( 644621 )

            Based on the above, either Musk is lying or you're lying. Or both.

            I was going to say the interview is on the public record, and easy to find. And while long so I don't expect you to watch it, you should probably do so before making such hideous accusations. If you behaved in real life like you do on the 'net, you'd be a very lonely person. What an ugly persona, but we all know it is fake.

            But! ... no need. Nothing in your links contradicts what I heard from him. Are the distinctions really so hard to grasp? Regulation is necessary, but very hard to get rid of once the

            • Re: (Score:3)

              by Merk42 ( 1906718 )
              Actions speak louder than words.

            • Elon makes statements to make you think he has left-wing sensibilities but doesn't. For example, he claimed to be a socialist .. but then his definition of socialism doesn't match anyone else's.
              So in https://twitter.com/elonmusk/s... [twitter.com] he tweeted "By the way, I am actually a socialist. Just not the kind that shifts resources from most productive to least productive, pretending to do good, while actually causing harm. True socialism seeks greatest good for all."

              Do you see the issue here? Socialism by everyone

    • Re:Wow (Score:5, Informative)

      by Bleek II ( 878455 ) on Thursday June 22, 2023 @11:55PM (#63625332)
      Tesla received hundreds of millions from the US government back in 2010 to get that head start. https://futurism.com/the-byte/... [futurism.com]

    • Re:Wow (Score:4, Informative)

      by CaptQuark ( 2706165 ) on Friday June 23, 2023 @12:55AM (#63625436)

      You did notice this was a LOAN, not a grant. Tesla received a $435M loan from the same Loan Program Office (LPO) in 2010 to get their initial Model S factory running.

      Ford has a net income of 1.76B with a profit of approximately 4.24%. Not much profit at this time to invest in a $11.4B assembly and battery plant.

      LPO has loans and loan guarantees available to help deploy innovative clean energy, advanced transportation, and tribal energy projects in the United States. Over the past decade, LPO has closed more than $30 billion of deals across a variety of energy sectors. Review our overview and subscribe to our newsletter to keep informed about the program. https://www.energy.gov/lpo/loa... [energy.gov]

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      Tesla uses Panasonic (Japanese) and CATL (Chinse) batteries. Their factories are built as partnerships with those companies. What what I can tell Ford's factories and technology are owned by Ford, i.e. the money isn't going to non-US companies.

      Can you imagine the outrage if some of that money went to a Chinese company?

      That's what they mean when they talk about Chinese dominance of EV tech. It's mostly the batteries, although they have good motors and drivetrains too. Panasonic batteries are good but conserv

      • They're jointly owned between Ford and South Korea's SK. This is called out in the summary. Geeks might be familiar with SK because it also produces SK-Hynix RAM.

    • I think Elon is a right-wing jerk, but itâ(TM)s mad unfair that Ford gets this money and Tesla which is years ahead of anyone does not get anything. $9.6 billion .. thatâ(TM)s billion with a fucking B, is a huge god damn amount of money.

      So this is how Capitalism dies, through hysterical bouts of whataboutism. I am less worried about how fair it is than how it affects the overall strength of the market. Ford did not 'earn' that money. They are having it GIVEN to them. That weakens them considerably which means that the vehicles that will be created out of this 'gift' will be uttter shit and completely unreliable. Why should they be any better? They already have the money, they won't be better.

      TL;DR, this is a very bad way to encourage EV ma

  • Didn't the US take Airbus and France, Germany and the UK to the WTO over similar "government provided low rate loans" in their support of Boeing? The crux of the issue being that the loans were not at market rate - which is same here, being that they are at rates not available on the current market...

    • There defacto is no more WTO. The EU commission as the last true Davos lackeys are desperately trying to get ICS off the ground, but the US won't be tied down and to China it's only a game. You needed at least the EU and the US to play nice to make globalism not a complete mockery. If China gets into an ICS based treaty and is just there to brazenly game the rules with no sense of decorum or diolomacy while the EU plays nice it will become an obvious charade.

      Globalism is dead, long live mercantilism.

  • Dishonest bs. (Score:3, Informative)

    by jdawgnoonan ( 718294 ) on Thursday June 22, 2023 @09:57PM (#63625160)
    I am happy that EVs are getting a boost, but the Inflation Reduction Act had nothing to do with reducing inflation. The fact that this is helping EVs is great, I cheer for the good deed. But politicians who lie to the public for the greater good are still liars.

    • Re: (Score:3, Informative)

      by Bleek II ( 878455 )
      I agree with your sentiment, but I should point out that increasing production capacity is actually part of reducing inflation.

      • It has absolutely nothing at all to do with the very real inflation the country has been experiencing. And especially nothing at all to do with the inflation that was plaguing political polls prior to passage. The naming of that bill was nothing but political branding to make the naive believe that the Democrats actually cared about the quickly increasing cost of every day items and energy. Increases that were very much tied to government policy pushed by those same Democrats.

        • I understand that you have problems with the bill and you're frustrated with the dishonesty of US politics. My pointing out economic information may have seemed condescending, sorry. But it's not all lies in that the people in power have their interests and goals to achieve. Increasing the industrial capacity of the US is one of their goals for various reasons beyond inflation. That also aligns with the stated goal of this bill.
          • I also want to add that, confirming your point, there are more effective yet less popular ways to reduce inflation. If they were to completely open the US market to foreign-made cars, like from China, it would have a much larger inflation-reducing effect. But... ya know... that wouldn't be very popular and it would destroy the economies of many cities/towns across the Midwest, South, Mexico, and Canada.

  • Irony (Score:5, Insightful)

    by PinkyGigglebrain ( 730753 ) on Thursday June 22, 2023 @10:12PM (#63625176)
    Kind of Ironic that Ford, GM, and all the rest of the US auto makers, along with most of the oil companies spent so much to kill electric vehicles in the US during the 1990s. And now Ford and the rest are "We need help to compete in a field that we could have been world leaders in now if we hadn't been such greedy gits 30 years ago." color me unsympathetic.

    • Well, the oil industry did have a gun to their collective heads

      Oil company funding is same reason "enviro" groups attack nuclear power

      The oil industry has powered our rise from burning charcoal, but their determination to hold on to markets that should no longer be available to them hurts us all

    • Because stuffing a bunch of lead acid batteries in a car for 30 miles of range would have been such a great product in the '90s? They were right in pushing back on ignorant government policy that had no basis in practicality nor reality, just a basis in politics and campaign funds from 'green' fund raisers.

      • Yes, this was part of my point. The market wasn't ready at that time.

      • Actually the EV-1's range was closer to 55 miles using the lead acid batteries and when later upgraded to the NiMH batteries the range went up to ~ 105 miles.

        When you consider that at the time the average daily car trip was ~ 29 miles even the lead-acid version would have been fine for ~90% of the drivers in the USA. The limited range only became a limiting factor for things like trucks, buses, taxis, and other applications that make up the other 10% of drivers.

        Even a lead-acid batty set would have been a

    • They just follow whichever way the wind blows.

    • Another issue is that Ford abandoned manufacturing anything but sports cars and trucks.

      If the goal is, as stated, to increase competitiveness with Asian imports, the money needs to go to a manufacturer willing to compete with Asian imports. That means affordable, basic transportation, not luxury vehicles. If the goal is to transition the population off gas vehicles, then it's even more critical that they are affordable.

  • Isn't Tesla in the US (Score:3, Interesting)

    by terrorubic ( 7709666 ) on Thursday June 22, 2023 @10:57PM (#63625262)
    Isn't Tesla in the US and why not give them the $9.2 Billion
    • Because Tesla still can't keep up with Elon's mouth. Full auto driving? Cyber Truck? Semi's? Ford has EV truck's (ute here in Australia) and isn't full of hype. Also China aint world leader if you count all the EV cars parked out in field's rusting away. Just like the millions of ride-share-bikes in fields. Look for "No Place to Place" andNo Place to Place 2" videos.

      • Re: (Score:2)

        by shilly ( 142940 )

        Are you seriously citing those videos as some sort of proof point? Do you really think that Chinese people aren't buying millions of EVs each year? Then just look at the UK market:
        - MG is Chinese owned and has the 4, the 5 and the ZS, all very popular and well regarded, and going to be joined by the Cyberster
        - Polestar is also Chinese owned, and has the 2 and the 3, again both popular and well regarded, and with more models on the way
        - Volvo is also Chinese owned, and has the C40, EX90, XC40 Recharge and EX

      • Re: (Score:1)

        by Anonymous Coward
        The complete ignorance of Americans is truly a sight to behold.
    • Presumably the US wants *good* EVs. I would also imagine that handing all that money to a company so recently engaged in union-busting [labortribune.com] would be a bad look.

    • Re:Isn't Tesla in the US (Score:5, Informative)

      by Waccoon ( 1186667 ) on Friday June 23, 2023 @02:50AM (#63625572)

      According to TFA, Tesla has received loans in the past to open their factories. They just don't need the money now.

    • Isn't Tesla in the US and why not give them the $9.2 Billion

      Unions.

      The stimulus laws passed by congress required union workers in the USA as a qualification for receiving the funds.

      Ford is (and the new Ford/SK partnership plants will be) a union shop.

      Musk is anti-union. He likes to run things his way, with no one allowed to tell him no. It works well for him -but it is not compatible with strong union contracts.

  • Where we'd be now had we NOT outsourced all our rare-earth production in the late 90's!

    • It will continue to be a problem. It doesn't matter how much you invest in battery factories if you don't have the raw material supply chain to back them up.

      • Re:Just imagine (Score:5, Informative)

        by shilly ( 142940 ) on Friday June 23, 2023 @01:14AM (#63625466)

        Rare earths are not use in EV batteries. They're used in many (but not all) EV motors. Supply chains are doing fine, despite the growth

  • "China's EV Dominance." LOL. China ain't world leader in EV's if you count all the EV cars parked out in field's rusting away. Just like the millions of ride-share-bike in fields. Look for "No Place to Place" and "No Place to Place 2" videos. Companies in China are just getting money from the CCP (or what ever they want to be called). They make low quality cars, register them and park them to get the CCP money. Scammers playing their government. And the CCP uses it to say they are better.
    • I was counting electric cars on the road in China a few months ago. They all have green license plates so they're easy to spot. I was in a major second-tier city of around 7 million people. Of the cars driving on the road, 30% were electric, but when I counted parked cars it was around 10%. I think that's due to the high number of DIdi (like Uber) using them. Those numbers dropped in half in a small city of around 60,000 people. The numbers are roughly in line with would the numbers are saying nationally. A

  • Terms of the loan (Score:5, Insightful)

    by Waccoon ( 1186667 ) on Friday June 23, 2023 @02:57AM (#63625580)

    If taxpayers are backing the loan, I'd assume the terms would be public information. TFA sure does talk a lot about how great EVs are and how much money is being handed out, but provides no details on what the loan interest rate is or what constitutes the "conditional" nature of the loan.

    Not like I expect anything more than PR fluff, of course.

    • Re: (Score:3)

      by MagicM ( 85041 )

      You expect details about the loan from Bloomberg? Who call themselves "the global business and financial information and news leader"?

      Yeah, ok, that's fair. Carry on.

  • China is not even close to "EV dominance." You have to very carefully and deliberately cherry-pick your stats to come up with such a claim, and they clearly have. Moreover, "keep up with"? So the United States... the by far industry leader in EVs... that is solely responsible for their current status and progress... can only hope to not be left too far behind Glorious Leader Xi's magnificent utopia?

    Man, fuck these lying sacks of shit.
  • 2 important things to know for context: the Chinese models are defective crap that break down constantly and light on fire VERY commonly and I think some countries are blocking them for import because of this, not to mention security concerns
    There are whole secret fields of brand new EVs that nobody wants, sitting to rot in China because the Communist gov wanted high numbers so they did high production numbers...of vehicles that nobody can afford. So they're going to just sit there and decay. That certainl

  • Expecting Ford to accomplish US EV dominance is a joke, since Ford is a proven laggard in everything it has ever touched since the Model T. This "loan" has to do with getting some votes from auto workers, and nothing more.

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