MARSHALL, Michigan, July 10 (Reuters) – Fred Chapman has a message for Ford Motor Co (FN), which is planning to build a vast factory on the outskirts of this city to produce batteries for electric cars and which promises to employ 2,500 people .
“We don’t need jobs,” he says.
This is startling insight from Chapman, a 62-year-old toolmaker who has spent his entire career in manufacturing and has seen factory after factory close in the region over the decades, including one at Marshall who made auto parts where Chapman worked for nearly a decade. He now he commutes to a factory job in a nearby town.
One of the most enduring ideas in the industrial heartland of the United States is that a manufacturing renaissance is needed to finally shake up the region’s “Rust Belt” image. And there are some signs that may be starting to show.
US factory construction spending has more than doubled in the past year, to an annual rate of nearly $200 billion in May, according to the Census Bureau.
President Joe Biden has made a factory revival a focus of “Bidenomics,” and his administration has pushed through laws like the Inflation Reduction Act and the CHIPS Act that have injected both direct funding and tax incentives into manufacturing construction.
Manufacturing now accounts for nearly 13 million US jobs, the most since 2008. But that belies the fact that factory work is increasingly a niche slice of the US job market, accounting for just over 8 .3% of jobs in June, the lowest share ever.
Many of the new factories that are springing up are huge, involving multi-billion dollar investments and creating thousands of jobs. Developers call these “megasites” and there is a surge in their construction in the United States
SIGN OF THE TIMES: ‘STOP THE MEGASITE’
Ford officials have met resistance to his plans, however, in the latest iteration of a phenomenon known as NIMBY, which stands for “Not In My Back Yard.”
“It’s a trend that we’re seeing across the country,” said Gabby Bruno, director of economic development at Ford, “and it’s really escalated recently due to a number of these megasites finally being developed, especially in the clean energy space.”
Not everyone wants gigantic projects, even in places that would seem ripe for an industrial renaissance. Soon after Ford’s plan was announced in February, concerned residents blocked city meetings, demanding more details about what was to come. Signs have sprung up on the roadsides pleading: “Stop the Megasite.”
“This whole thing would have been different if they had brought the community into the discussion,” said Glenn Kowalske, a retired engineer and one of the local leaders of the group fighting the project.
Opponents say the project is being rushed through final approvals and could cause environmental damage. It was built on former farm fields and woodland beside a winding river just outside the city. Some fear that new battery construction technology could cause accidents, which could allow lithium to leach into groundwater.
“I’m an engineer,” Kowalske said, “I know what lithium is. It’s a very volatile element.”
Ford’s Bruno said the automaker’s plant design includes plans for safety features such as double-walled tanks, dedicated piping to collect industrial wastewater and special fencing to prevent soil runoff into the nearby Kalamazoo River.
Critics also object to the involvement of a Chinese company in the project: Contemporary Amperex Technology Co Ltd (300750.SZ). Ford has a license to use CATL technology at the plant along with services provided by the Chinese battery giant.
Bruno countered that CATL’s involvement is “limited” and the plant is 100% Ford-owned.
Project size is also a sore point. An approximately 750-acre lot has been zoned for industrial development since the 1960s, and over the years, other manufacturers have sought to build a factory here. But as local economic development officials worked with Ford and other potential investors, it became clear they needed a much larger footprint. They added two adjacent parcels which added approximately 1,100 acres.
Only about 950 acres will be used by Ford, Bruno said, with some of that set aside as conservation easements along the river. The remainder was set aside by economic development officials for vendors and other developments.
Indeed, residents often battle major developments that threaten to alter the character of their communities. In some cases, they win, as happened when New York City residents rejected efforts by Amazon Inc (AMZN.O) to build a second headquarters in the city.
COMMUNITY BLOCKS
The most common result is delays, as local opponents mount lawsuits and raise other hurdles. In Marshall, residents petitioned for a referendum on the project, garnering more than 800 signatures in a town of 6,800. However, that effort stalled after the city rejected the petition. Activists are now suing.
James Durian, CEO of the Marshall Area Economic Development Alliance, which spearheaded the development, said he understands some residents have been surprised by the scale of the project and how quickly it was built. But he claims it was necessary to land Ford.
Durian said he understands concerns about Chinese involvement in the project. The United States has an adversarial relationship with China, but he said it has gotten “a little weird and paranoid.”
Sue Damron, owner of Schuler’s Restaurant and Pub in downtown Marshall, is supporting the project. She believes the workers will move to Marshall to work for Ford. “People who come to work for Ford have spouses and children,” she said. “They will give me an employee base to add to my small business.”
But Chapman, the craftsman, remains skeptical. His home is across the street from the Ford site, known as BlueOval Battery Park, and he’s been approached to sell his home to developers. But he doesn’t want to move.
Meanwhile, he sees a looming business problem. The unemployment rate in surrounding Calhoun County is 4.6%, higher than the national unemployment rate of 3.6%, but still low by historical standards. He notes that the factory where he works in nearby Battle Creek has struggled to find skilled workers.
“I’m in the industry. I see it,” he said, adding that his company has even recruited workers from Mexico to fill positions. “It’s just weird, there isn’t a supply of workers.”
Reporting by Timothy Aeppel in New York and Ben Klayman in Marshall, Michigan; Editing by Dan Burns and Nick Zieminski
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Timothy Eppel
