Ford plans $1.3 bn investment in Oakville plant for electric vehicles

Ford Electric Vehicle Complex in Oakville

Ford Motor announced that it will begin retooling its SUV assembly plant in Oakville, Ontario to produce electric vehicles starting in late 2024.

The plant will be overhauled as part of a C$1.8 billion ($1.34 billion) investment, which includes a new battery pack assembly operation. Most of the plant’s production workers will be idled during the retooling, which is scheduled to begin in the second quarter of 2024.

Ford has not confirmed whether the Oakville plant will assemble all five EV models agreed with Canada’s Unifor union during contract negotiations in 2020.

The timing, size, and location of EV investments by automakers such as Ford Motor, General Motors, and Stellantis will be a central issue in contract bargaining with unions in the U.S. and Canada later this year. Both Unifor and the U.S. United Auto Workers are urging automakers to commit to preserving jobs during the transition to electric vehicles.

“Canada and the Oakville complex will play a vital role in our Ford+ transformation. It will be a modern, super-efficient, vertically integrated site for battery and vehicle assembly. I’m most excited for the world to see the incredible next-generation electric and fully digitally connected vehicles produced in Oakville,” Jim Farley, Ford president and CEO, said.

“Ford’s commitment to invest in OAC retooling and upskilling signals a bright future for Canadian EV production and for Canadian auto sector employment,” said Lana Payne, Unifor National President. “The transformation of the Oakville plant is an important step towards a stronger industry and testament to the hard work, skills and dedication of our Unifor Oakville Assembly Complex members.”

Currently, the Oakville plant builds combustion Ford Edge and Lincoln Nautilus SUVs. The plant’s overhaul is part of Ford’s $50 billion investment program through 2026, which includes plans to assemble 2 million EVs globally by 2026.

The current 487-acre Oakville site includes three body shops, one paint building, one assembly building. The transformed campus will feature a new 407,000 square-foot on-site battery plant that will utilize cells and arrays from BlueOval SK Battery Park in Kentucky. Oakville workers will take these components and assemble battery packs that will then be installed in vehicles assembled on-site.

Ford officials stated that the next-generation EVs built in Oakville will need to be more efficient, easier to assemble, and more competitive with Tesla’s North American market-leading EVs. Battery cells for the Oakville-built EVs will come from a factory in Kentucky that Ford and battery partner SK On are building. It is too early to determine whether the batteries will meet domestic content requirements to qualify for U.S. Inflation Reduction Act purchase subsidies.

In addition to the Oakville Electric Vehicle Complex upgrades, Ford also has announced:

It is creating an all-new EV manufacturing ecosystem in West Tennessee – called BlueOval City – the home of a battery plant and the future home of Ford’s next-generation EV pickup. Together with two battery plants in Kentucky, which are part of a joint venture with SK On, these sites will create 11,000 new U.S. jobs and expected to begin production in 2025.

Ford is building a lithium iron phosphate battery plant in Marshall, Mich. Production is slated to begin in 2026, with 2,500 employees. Ford is the first automaker to commit to build both lithium iron phosphate and nickel cobalt manganese batteries in the U.S., helping America’s No. 2 EV company in 2022 diversify its U.S. supply chain.

It is modernizing its vehicle assembly campus in Cologne, Germany, transforming it to become the Ford Cologne Electrification Center – the company’s first EV center of excellence in Europe. This site will be the production home of the electric Ford Explorer for European customers; production begins later this year.

Ford, LG Energy Solution and Koç Holding have signed a non-binding memorandum of understanding to build one of the largest commercial electric vehicle battery cell production facilities in the European region. The project is on track to break ground near Ankara, Turkey, later this year, with production to start in 2026.

Ford this year is expanding production of the F-150 Lightning at the Rouge Electric Vehicle Center in Dearborn and the Mustang Mach-E at its Cuautitlan facility on Mexico.