U.S. Transportation Secretary Duffy issued a public warning about Ford’s cooperation with Chinese companies. The focus is on developments surrounding Ford’s use of CATL’s technology under a license, with attention on the impact on U.S. production and employment.
U.S. Transportation Secretary Duffy sent Ford’s CEO an open letter calling on the company to reconsider its cooperation with Chinese companies and reduce its dependence on them. In the letter, he said that “dependence on technology from hostile countries is not a sustainable strategy.” Ford responded by calling the letter “a misguided act intended to make media headlines.” The CEO explained that Ford’s agreement with CATL was merely a license granting the right to use its technology, and that the Michigan plant would be owned by Ford and operated with U.S. workers.
The central issue is Ford’s plan to use technology licensed from Chinese battery giant CATL to produce batteries at a plant in Michigan. Concerns have also been raised that contract manufacturing of Geely vehicles at Ford’s plant in Spain, joint development of SUVs for the European market, and the continuation of production in China for some Lincoln models could affect employment for U.S. workers and domestic production.
Ford described its agreement with CATL as merely a license and emphasized the advantages of domestic production and employment, adding that the White House also recognizes the value of the battery business. The U.S. government’s official criticism and the company’s immediate rebuttal have been described as unusual, and are seen as potentially affecting the reorganization of the auto industry’s China-related supply chains.