Ford Motor Co. has issued a stark warning that its planned electric-vehicle battery plant in Marshall, Michigan, could face significant risks if Congress proceeds with cutting federal tax credits for clean energy. The facility, which is expected to employ 1,700 workers, hinges on the financial viability provided by existing incentives, according to Ford Executive Chair Bill Ford. Speaking at the Mackinac Policy Conference, Ford stressed that altering these policies after substantial investments have been made would be unfair and could destabilize the project.

The Michigan plant is part of Ford’s broader strategy to electrify its vehicle lineup, though the company has already scaled back its initial production targets from 400,000 to 230,000 EVs annually due to weaker-than-expected consumer demand. The project’s future now faces additional uncertainty as Republican lawmakers push to phase out key provisions of President Joe Biden’s Inflation Reduction Act, including the $7,500 consumer tax credit for EV purchases and a manufacturing credit for battery producers set to expire after 2031.

Ford’s concerns highlight the delicate balance between policy stability and private-sector investment in the clean energy transition. "It’s not fair to change policy after all the expenditures have been made," Ford said. "The production tax credit seems to be up for grabs." He added that the business case for the Marshall plant was built around these incentives, and their removal could derail the project.

The proposed legislative changes also include stringent restrictions on the use of Chinese components in EV batteries, which analysts warn could render the credits ineffective. These developments come as the auto industry grapples with shifting consumer preferences and the high costs of transitioning to electric vehicles. Ford’s warning underscores the broader challenges facing the EV sector as it navigates political and economic headwinds.