LANSING, Mich. (AP) — A Michigan economic development board approved more than $400 million in state incentives Wednesday for two battery factories estimated to cost $4 billion and bring 4,500 jobs to the state.
Pending approval by state lawmakers, the incentive packages would draw from a fund created less than a year ago to help the automotive state land major business expansions in the wake of news that Dearborn-based Ford Motor Co. would begin building electric vehicle battery plants in other states.
“We are in global competition to make sure that Michigan stays on the cutting edge of auto manufacturing. Investments like the ones that we’ve announced today are game changers,” Michigan Gov. Gretchen Whitmer said Wednesday in an interview with The Associated Press.
A Michigan energy-storage company, Our Next Energy, would be allocated $236 million in the agreement for an up to $1.6 billion project in Van Buren Township outside of Detroit. An allocation of $175 million in incentives will go to a $2.4 billion factory planned by Chinese manufacturer Gotion for Big Rapids in northern Michigan. The factories would produce components used for electric vehicle batteries.
President Joe Biden showcased his administration’s efforts to promote electric vehicles during an appearance at the Detroit auto show last month when he said Michigan is “building the future of the electric vehicle.”
Under his Inflation Reduction Act, the batteries must be built in North America for electric vehicles to be eligible for a federal tax credit of up to $7,500.
The Michigan Economic Development Corporation board passed the incentives Wednesday but legislative approval will need to come through the House and Senate appropriations committees. A timeline for the committees’ approval is unknown, according to a spokesman.
The $2.4 billion Gotion project, which is planned on a 523-acre site in Big Rapids, would create 2,350 jobs with average wages of $29.42 per hour, according to the company’s proposal. The factory will produce cathodes and anodes, two components that are key to electric vehicle batteries. The board also approved a 30-year Renaissance Zone that was approved last week by county officials and will save the company an estimated $540 million.