Ford’s China ties draw federal scrutiny as trade tensions escalate

By willowt // 2026-09-10

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U.S. Transportation Secretary Sean Duffy demanded Ford Motor Company abandon its partnership with Chinese battery manufacturer CATL, citing national security risks.
Chinese Embassy spokesperson Liu Chang called on Washington to stop politicizing trade and economic issues.
Ford defended its arrangement as a limited technology-licensing agreement, not a joint venture or foreign-owned operation.
The dispute reflects broader U.S.-China trade tensions over technology transfer, manufacturing jobs and economic competition.
Ford previously suspended vehicle shipments to China amid retaliatory tariff disputes in April 2025.

The Trump administration escalated its pressure on American automakers Wednesday, with Transportation Secretary Sean Duffy demanding that Ford Motor Company sever its technology partnerships with Chinese firms or face continued scrutiny over alleged national security vulnerabilities. The confrontation marks the latest flashpoint in an ongoing trade war that has reshaped global supply chains and threatens to upend decades of economic integration between the world’s two largest economies.

Federal demand for decoupling

Transportation Secretary Sean Duffy sent a formal letter to Ford CEO Jim Farley on Tuesday, demanding that the automaker abandon its strategic partnership with Chinese companies and wind down joint projects. Duffy argued that dependence on Chinese technology “threatens national security and costs Americans jobs.” The letter specifically targeted Ford’s use of licensed battery technology from Contemporary Amperex Technology Co., Limited, known as CATL, the world’s largest electric vehicle battery manufacturer. Duffy’s office raised concerns about corporate espionage risks, supply chain vulnerabilities and the transfer of sensitive American manufacturing know-how to a Chinese state-aligned entity.

Beijing responds

Chinese Embassy spokesperson Liu Chang in Washington responded forcefully, urging the United States to “respect the laws of the market economy and the principle of fair competition.” Liu called on Washington to “set aside ideological bias, stop politicizing economic and trade issues, and create a favorable environment for China-US economic and trade cooperation.” The spokesperson emphasized that trade and economic relations between China and the United States are based on mutual benefit, and that stable ties serve the interests of both nations. China insists dialogue must proceed “exclusively on equality, mutual respect and mutual benefit.” Beijing has repeatedly accused Washington of attempting to attribute domestic economic problems to external factors, arguing that unilateral U.S. sanctions violate market economy principles.

Ford’s defense

Ford responded to the Transportation Department’s letter by characterizing the arrangement as a “limited technology-licensing and services agreement,” not a joint venture or foreign-owned manufacturing operation. The automaker stated it owns the plant where CATL-licensed batteries are produced, controls all operations and employs the workforce. Ford called Duffy’s letter “an attempt to capture headlines,” suggesting the administration was prioritizing political messaging over factual accuracy. The company’s defense highlights a central tension in U.S.-China trade policy: American firms seeking access to advanced Chinese technology while maintaining operational control and intellectual property protection.

Historical context: The 2025 precedent

The current confrontation follows Ford’s April 2025 decision to suspend vehicle shipments to China amid retaliatory tariff disputes. At that time, the automaker expressed existential concerns about its survival, with company leaders acknowledging that the most innovative vehicles were now being produced in China. The 2025 suspension was widely interpreted as a statement supporting economic freedom and fair trade principles, even as it underscored the shifting balance of automotive innovation. Henry Ford’s legacy of American manufacturing dominance appeared increasingly threatened by a Chinese industry that had leapfrogged traditional automakers in electric vehicle technology.

Broader implications

Representative Haley Stevens of Michigan, who participated in the 2009 auto industry rescue, has called for reducing dependence on China while bringing manufacturing home to Michigan. “We need to reduce our dependence on China, bring manufacturing home to Michigan, and lower costs,” Stevens said in a statement. The tension between national security concerns and corporate global strategy has created an uncertain environment for American manufacturers. Companies face pressure to decouple from Chinese supply chains while simultaneously needing access to Chinese battery technology to compete in the rapidly growing electric vehicle market. Critics of the administration’s approach argue that forced decoupling could accelerate China’s push for technological self-sufficiency while harming American companies that lose access to critical components. Supporters counter that China’s state-directed industrial policy poses an unprecedented threat to American economic sovereignty.

A crossroads for American manufacturing

The Ford-CATL dispute represents more than a regulatory disagreement. It embodies a fundamental question about America’s economic future: Can the United States compete in advanced manufacturing while maintaining security restrictions on technology partnerships? Or will protectionist measures accelerate the very decline they seek to prevent? As the global trade landscape continues evolving, the actions of Ford and other American manufacturers will likely determine whether the United States retains its industrial base or cedes leadership in critical technologies to China. The coming months will test whether dialogue based on equality and mutual respect can replace the escalating cycle of accusations and counter-accusations that has come to define U.S.-China economic relations. Sources for this article include: SputnikGlobe.com Local12.com Facebook.com