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Ford Motor (F - Analyst Report) has promised to invest up to $500 million in Michigan for the development and production of batteries for hybrid and electric vehicles. In exchange, the company has asked for a tax break in the range of $85 million to $120 million from the Michigan Government for its move that would create more than 1,000 jobs focused on engineering and building the battery packs.
 
Over the years, Ford’s advanced battery researchers have been working with battery suppliers, utility companies and top-tier academic researchers to develop, test and validate high-powered battery systems. The company feels that battery technology is a core competency that it must develop in-house.
 
Ford plans to introduce at least four battery electric vehicles (BEVs) in North America by 2012, including the Transit Connect BEV commercial vehicle in 2010 and Focus BEV in 2011, as well as new hybrids and a plug-in hybrid. The Focus BEV, jointly being developed with Magna, will be produced at the Michigan assembly plant.
 
So far, Ford has launched four hybrid vehicles on the road – the Ford Fusion Hybrid, Ford Escape Hybrid, Mercury Milan Hybrid and Mercury Mariner Hybrid. At 41 miles per gallon (mpg), the Fusion Hybrid is the most fuel-efficient mid-sized sedan in America, 8 mpg better than the Toyota Camry Hybrid.
 
Ford intends to use lithium-ion (Li-ion) battery packs that are 25% to 30% smaller and 50% lighter than nickel-metal hydride (NiMH) batteries. These attributes of Li-ion batteries makes them easier to package in a vehicle. Further, unlike NiMH batteries, Li-ion can be tuned to increase power to boost acceleration or to increase energy to extend driving distance.

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