Washington’s pressure on Ford to cut China ties could backfire: expert
A Ford logo is displayed above the automaker's booth at an international auto show in Guangzhou on May 1, 2026. Photo: VCGThe US administration on Tuesday criticized Ford Motor over its ties with Chinese companies, with Washington's political intervention reaching deeper into technology licensing, supply chains and routine commercial cooperation between companies in the two countries. Analysts said that the move could ultimately constrain US automakers, which are under pressure to cut electrification costs and keep pace with a fast-changing global industry.US Transportation Secretary Sean Duffy said in a letter to Ford CEO Jim Farley that the automaker's business relationships with CATL, Geely and BYD raised "profound concern," urging Ford to cut ties with major Chinese companies, Reuters reported.Ford pushed back, calling Duffy's letter "a wrongheaded attempt to capture headlines." In a statement, the company said that its CATL deal is a limited technology-licensing and services agreement, not a joint venture. Ford owns and controls the Michigan plant and employs its workforce, it said.The partnerships cited by Duffy vary widely in form and geography, from technology licensing in the US to manufacturing cooperation in Europe and potential battery sourcing overseas. Treating them all as "national security threats" overstretches the concept of national security and risks politicizing routine business decisions, analysts said.The partnerships show Ford drawing on China's strengths in battery technology, supply-chain efficiency and product development to stay competitive in the US, Europe and other major markets, Zhang Xiang, secretary-general of the International Intelligent Vehicle Engineering Association, told the Global Times on Wednesday.Ford's Michigan battery plant is owned by the company but uses licensed lithium iron phosphate technology from CATL, as this type of battery carries relatively lower costs. Its cooperation with Geely is centered in Europe, where the two companies announced in July plans for a manufacturing joint venture at Ford's Valencia plant in Spain. Ford said that the partnership would help maximize the plant's capacity and cut manufacturing costs amid fierce global competition and mounting cost pressures.Ford has also held talks with BYD over batteries for hybrid vehicles, with one option involving the use of BYD batteries in markets outside the US, Reuters reported, saying a potential deal would give Ford access to cheaper batteries and advanced technology from one of China's largest electric vehicle (EV) makers.Such cooperation reflects both the globalized nature of the auto industry and Ford's need to strengthen its position in electrification, Zhang said. "Chinese battery makers such as CATL and BYD have built strong advantages in technology, scale and cost control, while Ford faces intense competition from Tesla and other automakers," he noted.For Ford, working with globally competitive suppliers is a practical way to shorten development cycles and improve competitiveness, Zhang added. Pressures are already evident in Ford's financial performance. Its fourth-quarter core profit fell about 50 percent to $1 billion, as higher-than-expected costs weighed on earnings. Nevertheless, Farley said that the automaker was cutting costs and working to produce more globally competitive models.The strain is even more pronounced in Ford's EV business. Its EV and software unit lost about $4.8 billion in 2025, and Ford expects another $4 billion to $4.5 billion in losses from the business this year."Washington's push to revive domestic manufacturing is increasingly at odds with its efforts to restrict Ford's access to globally competitive technologies and supply chains," Zhang said.If administrative restrictions make it harder for Ford to access advanced EV technologies and efficient supply-chain resources, they could weaken the company's competitiveness and, in turn, affect US vehicle manufacturing, jobs and industrial resilience, the expert warned.Duffy's intervention comes amid a broader tightening of US restrictions on China's vehicle sector. Washington has maintained additional tariffs of 100 percent on Chinese EVs, while a US Commerce Department rule bars certain China-linked connected-vehicle software from model year 2027 and related hardware from model year 2030.China has repeatedly criticized such measures. Responding to the US connected-vehicle restrictions, a Chinese Foreign Ministry spokesperson said previously that the restrictions lacked any factual basis, disrupted economic and commercial cooperation between companies, violated the principle of market economy and fair competition, and represented typical protectionism and economic coercion.
