Michigan’s $1B bet on EVs has produced few jobs. Should lawmakers double down?

• Michigan is facing increasing criticism over its large-scale business subsidies
• The state already has spent $1 billion across five EV battery-related projects in the state
• None of those deals have yielded significant job growth and the EV industry may face further slowdown

Michigan has invested $1 billion in five electric vehicle battery plant proposals and promised another $1 billion, but most projects are behind schedule and have produced a tiny fraction of the 11,300 promised jobs.

An June investigation by Bridge Michigan found that only about 200 workers had been hired at the projects, two years after the state agreed to large-scale taxpayer subsidies. 

Little has changed at year-end, based on a review of the deals by Bridge and available information from the subsidy recipients: established companies Ford Motor Co., General Motors and LG Energy Solutions, as well as newer manufacturers Gotion Inc. and Our Next Energy.

“There have been some jobs advertised … but most of those are still at the managerial level,” said Brad Hershbein, senior economist and deputy director of research at the W.E. Upjohn Institute for Employment Research in Kalamazoo.

“These are the people who are going to do the subsequent hiring for line workers, maybe at some point in the future. But it hasn't really materialized yet.”

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The slow pace is one of many concerns of Lansing lawmakers as GM seeks another $250 million from the state for a $1.6 billion plan to redevelop the Renaissance Center in Detroit with billionaire Dan Gilbert.

Some lawmakers and business leaders say enough is enough.

Former Republican House Speaker Jase Bolger said the most recent EV deals are “some of the most egregious examples” of why large economic development subsidies should end.

His reason: “What they haven't produced thus far, how much we've put forward and how little has been produced for Michigan workers.”

“‘Pay me now and I'll give you jobs later,’ just has not worked,” added Bolger, spokesperson and an adviser for the West Michigan Policy Forum.

Democrats relinquish control of the state House on Dec. 31, and Gov. Gretchen Whitmer, a fellow Democrat, wants them to extend her signature development plan, the  Strategic Outreach and Attraction Reserve (SOAR) Fund that funded the EV deals and is set to expire in 2025.

Some legislators have balked or proposed alternatives, such as redirecting money to transit or childcare. Republicans are taking a harder line, with incoming House Speaker Matt Hall, R-Richland Township, calling SOAR “corporate welfare” that “should expire.”

“Roads are a higher priority than giving the money to corporations,” Hall said, noting GM’s $12.4 billion in adjusted profit in 2023. 

Defenders of the subsidies say it’s too early to judge their effectiveness. Companies receiving them still have years to produce promised jobs, and two initiatives — one each from GM and Ford — expect production to start in 2026.

The debate comes as electric vehicles endured a tumultuous 2024. Automakers continue to lose money on the vehicles, cutting production and staffing. President-elect Donald Trump has promised to reverse federal policy that encourages EV adoption, increase tariffs, eliminate tax credits to buy electric cars and halt lowered emission standards.

“While there are signals out there that the EV adoption rate is slower than originally anticipated, it is expected that the EV market will demonstrate a steady annual growth trend, and the transition will continue,” said Otie McKinley, spokesperson for the Michigan Economic Development Corp. that oversees the subsidies.

The five companies receiving the EV incentives have invested $4.1 billion in Michigan so far, data from the state shows. 

McKinley urged patience.

“We are currently embarking upon the most profound and evolutionary shift in the automotive industry since the advent of the internal combustion engine,” he said. 

Here’s where the projects stand, based on available state records.

General Motors

At least half of Michigan's large-scale subsidy spending went to General Motors’ promise that two electric vehicle battery initiatives would bring 4,000 jobs to the state by the end of 2030. 

GM has received $468 million of the state’s combined $600 million incentive promise, according to a Bridge review of the deal. One portion was for building an Ultium battery factory in Eaton County’s Delta Township, with the other going toward an expanded EV factory at Orion Assembly in north Oakland County. 

Another $66 million has been distributed to the Lansing Area Economic Partnership for utility upgrades to support the new Ultium factory. 

New hiring remains slow.

The idled Orion Township factory was supposed to be retooled and expanded, making EV trucks by this year. 

However, instead, GM halted production — though it said it continues with construction — and now plans to open vehicle manufacturing there in mid-2026. 

Meanwhile, GM announced this month that it would sell its share of the 2.8 million-square-foot Ultium factory to battery partner LG Energy Solutions. It hasn’t named a price, but GM will recoup $1 billion, Reuters reported.

LG Energy Solutions will fulfill the terms of the SOAR agreement, including hiring, McKinley said. 

Production is now scheduled for 2025, the company said. 

Neither GM nor LGES would say how many of the expected 1,700 workers have been hired. Job posts so far include a handful of engineers and a production supervisor, as well as summer interns. 

Our Next Energy

Our Next Energy, a battery startup in Van Buren Township, received about $70 million of a pledged $200 million in state funding, along with $15 million in a loan. 

The company has hired about 50 employees of the 2,112 it promised for the subsidy. The factory is producing prototype lithium iron phosphate batteries. 

“As the build-out and additional phases are completed, more employees will be brought on board,” ONE spokesperson Dan Pierce told Bridge. 

Gotion

The most controversial project is Gotion Inc. The US-based division of China’s Gotion High-Tech Ltd., was bashed during the presidential campaign by President Donald Trump and other Republicans who questioned the subsidy.

So far, Gotion has not received any of its $125 million state subsidy toward its new battery component factory in In Green Charter Township near Big Rapids.

However, economic development group The Right Place received $50 million toward the land for the factory, and the property was turned over to Gotion. 

Gotion sued the township over land entitlements and utility access after officials — elected on an anti-Gotion slate — added new parameters for how the project would be approved. That litigation remains in the courts, preventing the factory from progressing until it is resolved. 

Gotion has hired fewer than 10 employees in Michigan, though the subsidy award calls for 2,350 by the end of 2031, a year later than originally approved.

LG Energy Solutions

In Holland, LG Energy Solutions has been making EV batteries since the South Korean manufacturer opened its Michigan campus in 2012. 

Its latest contract represents “onshoring” of EV battery making, with a deal to make batteries for the Ford Mustang Mach-E in 2025. The batteries have been made in Poland.

The company is completing a second expansion while planning a third, valued at $1.7 billion. The work will be subsidized by a $10 million state grant and over $40 million in local tax breaks. 

While not a SOAR project, the expansion plan calls for 1,200 new jobs, which is expected to bring the company total there to 3,000. 

Site plans have been approved, local officials said, but building has not started.

Hiring progress was not disclosed. The company recently posted 23 jobs in Holland, with none for general production roles. 

Ford Motor Co.

Ford’s plans to build a battery factory in Marshall was met with fanfare, but in  fall 2023, when the automaker hit pause on the project.

However, the Dearborn automaker now continues to build its Blue Oval Battery Park Marshall, with a goal of launching production in 2026.

While moving ahead, the Calhoun County project is smaller, going from 2,500 projected jobs to 1,700. In turn, the state reduced the company’s $210 million subsidy to $166 million. The downsizing resulted in an overall loss of $600 million in incentives for the project when the state also adjusted tax breaks.

However, Michigan has spent millions of dollars on supporting the project, including a $300 million appropriation and a portion of the $330 million budgeted for road upgrades. Over $100 million has been spent by the state to acquire land for the factory. 

As of late November, “crews are working diligently to enclose the north end of the plant,” Ford spokesperson Lucy Hough told Bridge. “Numerous construction tasks, especially those inside the building, will take place over the winter.”

Ford has not disclosed hiring. It is advertising 21 open jobs, including a recruiter for salaried and hourly positions. The number of postings has doubled since summer.

Next steps

Delays aren’t unusual with big development projects, and corporate subsidies are often “scaled back or negotiated,” Hershbein of the Upjohn Institute told Bridge.

Amid the delays, preparations continue in Michigan for EV battery job growth. In west Michigan, educators are preparing to train a workforce for the Ford battery factory in time for the projected 2026 opening. 

Western Michigan University this month announced a $700,000 plan to work with industry to increase training for battery and semiconductor technology jobs.

Kellogg Community College is upgrading its advanced manufacturing assembly training program. The $4 million project with the state seeks to bring more people in the Marshall region into career tech programs. 

The Lansing area also anticipates that jobs will materialize for the state’s investment in the Ultium plant, Lansing Mayor Andy Schor told Bridge. 

Regardless of the ownership and technology decisions surrounding the plant, “it’s going to make batteries,” Schor said. Construction included upwards of 400 electricians at the site this fall, he added. 

“The economic benefits are still real for Lansing and the state,” Schor said.

But hesitation remains among legislators and some business advocates amid the debate about the future of large-scale incentives in Michigan.

State Rep. Julia Rogers, D-Kalamazoo, told Bridge that she’s waiting to see specifics on what Whitmer’s SOAR proposal will look like before committing to a vote. 

“I haven't made a decision,” Rogers said, adding “the devil’s in the details.”

The Detroit Regional Chamber of Commerce supports SOAR, and Business Leaders for Michigan CEO Jeff Donofrio said the mega-incentive made the state competitive for large-scale manufacturing projects. 

However, moving forward, Donofrio said he believes “we can do less with incentives every year … because you don't need as many to close the gaps” due to infrastructure and talent gains. 

The debate comes amid “a lot of uncertainty” about the growth of EVs, Hershbein said. About 9% of cars sold in the US in September were EVs, up from 7% for much of the year, according to Cox Automotive. 

That’s below from the projected pace that once made GM invest in the Lansing-area EV battery factory.  Further, the potential Trump policy changes have automakers wary, experts have said. 

Eliminating an EV subsidy in Germany resulted in a 37% dip in EV sales in July, according to European sales totals. 

“As much as Ford and GM and the other auto manufacturers are still saying they're committed to EVs, and I think that there's still going to be a market for them … they're waiting with bated breath to see what Trump is going to do,” Hershbein said. 

“There are a lot of reasons for businesses to be hesitant.”