U.S. lawmakers are seeking to review the license agreement between Ford Motor Co. and a Chinese battery maker.
They’re concerned that the deal will facilitate China’s global dominance in electric vehicle (EV) battery technology with U.S. taxpayers’ money and will increase America’s reliance on Chinese critical raw materials. According to the lawmakers, the Chinese battery maker’s supply chain in Xinjiang also raised a question about forced labor and the potential violation of the Uyghur Forced Labor Prevention Act.
In February, Ford announced that a new $3.5 billion plant would be built in Marshall, Michigan, 100 miles west of Detroit, to produce lithium-iron-phosphate batteries, better known as LFP, a type of battery that’s cheaper but less energy-dense than the nickel-cobalt-manganese batteries that currently dominate the market.
A wholly owned subsidiary will own the factory and employ the workers, Ford said, while China’s Contemporary Amperex Technology Co. Ltd. (CATL), as part of a licensing agreement, will provide the EV battery technology, some equipment, and workers. CATL is the world’s largest manufacturer of EV batteries and is known for its dominance in LFP batteries. Ford expects production to begin in 2026, with the plant estimated to produce enough batteries for 400,000 EVs each year.
“If Ford is using a licensing agreement to maximize benefits to itself or CATL at the expense of the U.S. taxpayer, this demonstrates a disregard for corporate responsibility as an American company,” the chairmen warned in the letter. “Such behavior raises serious questions as Congress conducts oversight of the implementation of this and other federal tax incentives.”
The letter comes after a bipartisan delegation of the House China panel visited Detroit a month ago. The Ford–CATL deal was on the agenda of the committee members’ meeting with Mr. Farley. Afterward, Mr. Gallagher said the meeting was “the first conversation,” and said he hoped to have many more.
Xi’s Advice to CATL
At the news conference, Mr. Gallagher shared similar concerns as were stated in the July 20 letter to Ford. He said that “there’s no such thing as a private company in China,” referring to the Chinese Communist Party’s (CCP’s) overall control of the private sector.Indeed, CATL seems to enjoy attention from the highest level in China.
In response to Mr. Zeng’s report, Mr. Xi said he was “happy and worried.” He advised Mr. Zeng to have “an exit strategy when others compete with us in a zero-sum game.”
“We need to avoid penetrating deep into enemy territory alone, only to be caught by others and get wiped out,” Mr. Xi said about nascent industries.
Mr. Zeng is a member of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), a political advisory body to the communist regime. His current term expires in 2028.
Ford’s Response to Lawmakers
Ford declined to comment on the letter except to confirm that the company was reviewing it and would respond soon to the committee chairs, who gave an Aug. 10 deadline.“On the subject more broadly, there has been a lot of misinformation about Ford’s new battery plant in Marshall, Michigan. Here are the facts: Ford alone is investing $3.5 billion and will own and run this plant in the United States instead of building a battery plant elsewhere or exclusively importing LFP batteries from China, like our competitors do,” a Ford spokesperson wrote to The Epoch Times in an email response.
“We’re creating 2,500 new American jobs while helping to strengthen domestic manufacturing and supply chains and reduce carbon emissions. This is good for our country, good for the planet, and good for Ford’s business,” she said.
Job creation was another thing that the lawmakers questioned in their letter, asking if several hundred of the 2,500 jobs would be given to CATL employees from China and remain in the factory until approximately 2038.
However, lawmakers have previously expressed an understanding of the competitive dilemma in Ford’s view.
