For much of the 20th century, Ford Motor Company operated the world’s largest single industrial site at its Rouge complex in Dearborn, Michigan.

What’s now called the Ford Rouge Center was 2,000 acres with 103,000 employees in its heyday 90 years ago. Now comprising 600 acres and 6,000 employees, the Rouge remains Ford’s largest, single industrial site.

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But not for long.

Ford’s Blue Oval City at the Megasite of West Tennessee will measure 3,600 acres and, if all goes to schedule, open in 2025 with about 6,000 workers on the payrolls of Ford and its suppliers.

Going vertical again

Old Henry Ford built the Rouge to be “vertically integrated manufacturing,” meaning the automaker produced and assembled on site nearly every component of the Model T and Model A Fords.

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“For Henry Ford, this meant making as much of the cars as possible in this complex and it also meant making the steel, glass, tires and other things like that,” Prof. Harley Shaiken said.

The University of California, Berkeley professor emeritus who studies labor and globalization put into perspective the scale of Blue Oval City.

It’s unclear what portion of the parts for the electric-powered pickup trucks Ford and its suppliers will make 40 miles northeast of Memphis at Blue Oval City.

But the sheer amount of acreage suggests Ford is returning, or at least giving a respectful nod, to its roots in vertically integrated manufacturing.

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Ford had gone horizontal by decentralizing manufacturing in the last half of the century, when off-site suppliers played a bigger role.

“The company will utilize the majority of the site as part of its plans to vertically integrate its production operations as much as possible on the site,” Lindsey Tipton said in email responses to The Daily Memphian. She is spokesperson for the Tennessee Department of Economic & Community Development, which led the recruitment of Ford to the Megasite of West Tennessee.

Blue Oval City likely will never come close to employing the 103,000 workers that the Rouge employed in 1932.

But Ford, battery-maker and joint-venture partner SK Innovation and their suppliers in the Megasite’s “supplier park” are projected to create nearly 6,000 jobs. And that’s just at the start, in 2025, of Blue Oval City’s work to make Ford Lightning pickups.

More than enough acreage?

The acreage there portends the possibility of expanded operations down the road, Shaiken said.

The 3,600 acres is “far more than you would need even for a mega-assembly plant and a large battery plant,” he said.

The site is six times larger than today’s Ford Rouge Center.

“That indicates future expansion on a large scale and a significant number of suppliers locating on the site,” Shaiken said.

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“We’ve seen Ford do that in green fields outside the U.S. One that immediately comes to mind is a Ford plant that came online in the early 1990s in Mexico. There was a lot of room for suppliers right next to it,” Shaiken said.

Suppliers: On and near Megasite

Ford did not respond to questions about the scale and role of suppliers at Blue Oval City. But suppliers will locate both within and close to the Megasite, the state official said.

“We anticipate there being a significant supplier presence in Blue Oval City,” said Tipton, of the Economic and Community Development office. “However, there will be a need for some suppliers to locate in close proximity but not necessarily on campus.”

In its September release announcing plans for Blue Oval City, Ford officials said the six-square-mile campus “will encompass vehicle assembly, battery production and a supplier park in a vertically integrated system that delivers cost efficiency while minimizing the carbon footprint of the manufacturing process.

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“The assembly plant will use always-on cloud-connected technologies to drive vast improvements in quality and productivity. The mega campus is designed to add more sustainability solutions, including the potential to use local renewable energy sources such as geothermal, solar and wind power.”

State officials don’t yet know how many of the 6,000 employees will work for Ford suppliers, Tipton said. She added that her department “is actively working with Ford as the company builds out its supplier strategies.”

Controlling the battery quality

Critical to electric vehicles are the batteries, which is why SK Innovation will locate in Blue Oval City in the joint venture with Ford.

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The South Korean company will make lithium-ion batteries at the Megasite in Haywood County.

Shaiken noted the relevance of the current problem General Motors is experiencing with batteries made by its supplier, LG, and how Ford is designing Blue Oval City to prevent such issues.

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General Motors this year recalled 142,000 of its Bolt electric vehicles after identifying battery defects that caused at least 10 Bolts to catch fire.

“I think that’s one of the reasons why having a joint venture and working more closely, they hope to avoid those quality problems,” Professor Marick Masters said of Ford and SK Innovation. Masters studies labor at Detroit’s Wayne State University.

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Ford, he said, is “partnering with somebody who specializes in this area. They can bring the skills and also have the connections with the supply chain to get the raw materials. Lot of advantages with having a joint approach with somebody already established in the industry.”

GM’s battery recall will cost $1.8 billion. LG will foot most the expense, but the GM’s image will still take a hit, Shaiken said.

The long drive to making cars closer to Memphis

“Ford is not going to make that mistake,” he said. “Ford is giving every indication, now particularly under CEO Jim Farley, they plan to be one of the leaders of the electric transition globally.

“That means going back to some of Henry Ford’s principles, as far as (manufacturing) integration,” Shaiken said.

The transmission and electronics are also critical to the pickup trucks, Shaiken said. “They could have research and development there in electronics,” he said of Blue Oval City. “There’s always an advantage to be close to where you are actually making” the vehicle.

Said Masters, “I think (Ford) would want to ensure they have geographically as proximate a relation with their suppliers as possible.”

Automakers in the Detroit area, Illinois, Ohio and Indiana have OEMs (original equipment manufacturing) with suppliers nearby,” he said. “That creates all kinds of economies of scale.”

Fewer parts but brighter future

Making electric vehicles creates fewer jobs than making ones powered by the internal combustion engine. The drive train of a gas-powered car has about 2,000 moving parts compared to just 20 for an electric car.

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If that’s the bad news involving Blue Oval City, the good news promises a higher and longer lasting upside. Making electric vehicles would seem to future-proof Blue Oval City.

Only 2.2% of new-vehicle sales were fully electric vehicles through June, according to Edmunds.com. But that’s up from 1.4% compared to the same time last year. And carmakers are in the throes of converting to battery-powered vehicles.

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For example, Jim Farley, Ford’s chief executive, projects 40% of Ford’s sales to be fully electric cars by 2030. General Motors has a goal of selling only electric vehicles by 2035.

There’s really nothing too chancy about Blue Oval City, Shaiken said.

“You can’t force someone to buy an electric vehicle. And they are now a low percentage of the market,” he said.

“But what’s different is, the damage of climate change is wildly out of control now with fires across the West, with flooding and extreme weather across the East and South,” Shaiken said. And the United Nations recently reported that 80% of the Earth’s population are being affected by climate change.

Corporations like the automakers are committing billions of dollars to address climate change, he said.

When electric vehicles start to dominate the roadway may be unclear, Shaiken said. “But what we do know is the days of the internal combustion engines are limited, simply because of the broader impact on the environment.”

“… I used to be concerned about this because I didn’t want my grandchildren to experience” the impacts of climate change, Shaiken said.

“But it’s not my grandchildren now. It’s me and my wife.”