U.S. Government Tells Ford to "End Dependence on Chinese Technology," Zeroing In on CATL and Geely Cooperation

【Financial News New York = Lee Byung-chul, correspondent】 The U.S. government has publicly pressured Ford Motor Company, one of the country’s leading automakers, to scale back its cooperation with Chinese companies. The move is seen as an effort not only to block Chinese automakers from entering the U.S. market, but also to sever American companies’ dependence on Chinese battery technology and supply chains.
According to The Wall Street Journal (WSJ) on the 8th local time, U.S. Transportation Secretary Sean Duffy criticized Ford Motor Company’s "dependence on technology from foreign adversaries as not a sustainable strategy for the United States" in an open letter to Jim Farley, the company’s chief executive officer (CEO).
Duffy noted, "While I recognize the intense competitive pressures in the global market, Ford’s recent strategic decisions present a troubling picture of an American company entangling its future with Chinese state-supported companies."
It is unusual for a sitting U.S. cabinet secretary to publicly pressure a specific American automaker by directly addressing its business strategy. Concerns about Ford Motor Company’s cooperation with Chinese companies have also been raised in both Republican and Democratic circles in Congress.
Duffy specifically targeted the cooperation between Ford Motor Company and Chinese battery maker Contemporary Amperex Technology Co., Limited (CATL). Ford Motor Company is pursuing a plan to produce batteries at its plant in Michigan by licensing CATL’s technology. Although the batteries would be manufactured in the United States, the core technology would come from a Chinese company.
Ford Motor Company’s recently announced European business with Geely Automobile also came under scrutiny. Ford Motor Company plans to produce Geely vehicles for the European market at a plant in Spain, while the two companies plan to jointly develop sport utility vehicles (SUVs) for overseas sales. The vehicles will not be sold in the United States. Duffy nevertheless argued that the cooperation "helps a strategic adversary establish a critical foothold in Western markets."
Duffy also took issue with Ford Motor Company’s production of Lincoln vehicles sold in the United States in China. Ford Motor Company plans to move that production to the United States starting in 2030, but Duffy criticized the company for relying on Chinese production until then while American skilled workers lose manufacturing jobs.
Ford Motor Company’s dilemma reflects the broader challenges facing the U.S. auto industry. The company strongly opposes Chinese automakers’ entry into the U.S. market and supports legislation that would ban Chinese companies from producing and selling vehicles in the United States. At the same time, it is difficult to secure price and technological competitiveness in global markets without partnering with Chinese companies.
Ford Motor Company has discussed supplying batteries for future hybrid vehicles not only with CATL and Geely Automobile, but also with BYD, which has grown into one of the world’s largest automakers. Farley was reportedly said to have proposed to U.S. government officials at this year’s Detroit Auto Show the possibility of establishing a joint venture with a Chinese automaker to produce vehicles in the United States.
China has established a technological lead particularly in batteries, where it has strong price competitiveness. Ford Motor Company chose to use CATL’s technology to produce batteries in the United States because it judged that catching up with China through in-house development alone would take considerable time.
Duffy, however, demanded that Ford Motor Company reduce its dependence on Chinese companies and establish a clear path toward technological self-reliance. He said, "If a company intentionally increases its business dependence on a strategic competitor, it cannot be the reliable partner the American people demand."
About 80% of the vehicles Ford Motor Company sells in the United States are produced domestically. Ford Motor Company did not immediately comment on Duffy’s open letter.



[email protected] Lee Byung-chul, correspondent Reporter