Ford China Ties Draw U.S. Scrutiny

Ford Motor Co. (F)'s China ties drew a formal warning on Sept. 3 when Transportation Secretary Sean P. Duffy wrote that the Department of Transportation expressed profound concern about the automaker’s use of CATL‑licensed battery technology and partnerships with Geely and BYD, signaling heightened policy scrutiny.

DOT Letter Flags National-Security and Supply-Chain Risks

The Sept. 3 letter, released publicly on Sept. 8, framed Ford’s relationships with Chinese firms as a national-security and supply-chain risk. It said the company’s recent strategic decisions “paint a troubling picture of a foundational American brand actively intertwining its future with Chinese state-backed enterprises.” The letter singled out several commercial ties as evidence of this trajectory.

Duffy highlighted Ford’s use of battery technology licensed from Contemporary Amperex Technology Co. Ltd. (CATL) at its BlueOval Battery Park Michigan facility in Marshall. He noted CATL’s inclusion on a Pentagon list of companies linked to China’s military. The letter also cited Ford’s joint venture with Geely to operate its Valencia, Spain, plant and produce vehicles starting in 2027, ongoing talks with BYD over hybrid components, and the plan to continue Lincoln Nautilus production in China until about 2030. These examples raised concerns about Ford’s reliance on Chinese manufacturing and technology.

Republican lawmakers quickly supported the letter’s tone. Members of Congress endorsed the warning, and a House select committee posted a comparison of Ford’s public statements and its business dealings with Chinese firms. The Chinese embassy in Washington urged that routine commercial ties not be politicized and called for respect for market principles and fair competition.

Ford Disputes Characterizations and Details of China Ties

Ford responded on Sept. 9 with a formal statement disputing the letter’s characterizations and alleging factual errors. The company said the Marshall battery facility is Ford-owned and Ford-operated. It described the arrangement with CATL as a limited technology-licensing and services agreement, not a joint venture or foreign-owned manufacturing operation.

The company said the Marshall plant will produce lithium-iron-phosphate batteries under CATL-licensed technology, support about 1,700 American jobs, and represent billions of dollars in investment. Ford added that while some competitors import Chinese batteries, it is investing to build batteries in the U.S. and described itself as the nation’s top-producing carmaker supporting the administration’s manufacturing priorities.

Ford announced the Marshall LFP battery project in February 2023 as a $3.5 billion initiative and later scaled it to roughly 20 gigawatt-hours of capacity. The company expanded the CATL license to cover stationary-storage batteries linked to a Kentucky project involving about $2.0 billion of investment, with shipments expected from 2027.

Separately, Ford’s European strategy has drawn scrutiny. A July 23 announcement formalized a partnership with Geely, which will take a 34% stake in an entity operating Ford’s Valencia plant from 2027. The plant will produce a European Bronco, a jointly developed crossover, and two Geely-sourced electric SUVs starting in 2028. Ford also maintains stakes in Jiangling Motors and Changan Ford in China, where wholesale volumes have declined while exports from Chinese plants have increased.

The Sept. 3 letter did not propose sanctions but signaled that federal agencies and lawmakers may scrutinize Ford’s eligibility for government partnerships, programs, and incentives. This places near-term strategic decisions—such as where batteries and vehicles are built and which technologies are licensed—squarely in the policy arena.