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US Lawmaker Challenges Ford's Battery Deals with Chinese Firms CATL and BYD

US Congressman John Moolenaar has written to Ford CEO Jim Farley expressing serious concerns over the automaker's battery technology plans with Chinese firms. The letter questions Ford's licensing agreement with CATL, a company designated by the Pentagon as a Chinese military company, and how it impacts eligibility for US clean energy tax credits. Moolenaar also raises alarms about reported discussions for a potential new partnership between Ford and another Chinese automaker, BYD. The lawmaker warns that such partnerships with adversarial nations create serious supply chain vulnerabilities for an iconic American company.

Key Points: US Lawmaker Flags Security Risks in Ford's China Battery Plans

  • Security concerns over Chinese military-linked firms
  • Questions on clean energy tax credit eligibility
  • Ford's pivot to energy storage & data centers
  • Potential new partnership with BYD flagged
  • Warning on weaponized auto supply chains
2 min read

US lawmaker flags security, tax credit concerns over Ford's battery plans with China's CATL and possible BYD tie-up

Chairman John Moolenaar raises tax credit and national security concerns over Ford's partnerships with Chinese battery giants CATL and BYD.

"Ford should work with our nation's allies, not our adversaries. - John Moolenaar"

Washington DC, January 29

Chairman John Moolenaar of the Select Committee on China has written a letter to Ford Motor Company CEO Jim Farley about the automaker's plans to produce data centre batteries using technology from CATL, a Pentagon-designated Chinese military company, according to a release by the Select Committee on China.

In the letter, Moolenaar asks Farley about Ford's intention to enter the energy storage sector with CATL, and whether any changes were made to the company's licensing agreement with CATL after new eligibility restrictions came into effect, the SCC release said.

"Public statements from Ford indicate that the company plans to repurpose its existing U.S. battery manufacturing facilities to produce lithium iron phosphate (LFP) cells and grid-scale energy storage systems. This effort would leverage technical know-how licensed from Contemporary Amperex Technology Co., Limited (CATL), a Department of War-designated Chinese military company. Ford's apparent changes follow enactment of the One Big Beautiful Bill Act, which placed new restrictions on eligibility for clean energy tax credits, including limits related to licensing arrangements with prohibited foreign entities," writes Moolenaar in the letter, as quoted by SCC release.

"In particular, the statute disqualifies tax credits for licensing agreements that are modified after the bill's enactment, or that involve ongoing technical dependence or revenue-sharing with a foreign-influenced entity. Ford's revised business plan raises important questions about whether the original licensing terms have been updated, expanded, or otherwise altered to accommodate the company's new focus on energy storage systems and data center markets," he stated as cited by SCC release.

The letter also requests clarification on a possible new reported partnership between Ford and BYD, a Chinese automaker, following Moolenaar's warning to Ford earlier this year, SCC release stated.

"If reports that Ford is in discussions to potentially partner with a second Chinese battery company were to come true, it would diminish Ford's status as an iconic American company. China has already shown in recent months that it will weaponise the auto supply chain. This is a serious vulnerability and it would only get worse if Ford enters into a new partnership with BYD. Ford should work with our nation's allies, not our adversaries," said Moolenaar on January 15, as noted by the SCC release.

- ANI

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Reader Comments

P
Priya S
Interesting to see the US grappling with this. In India, we are also trying to build our own battery and EV ecosystem to reduce dependence. Maybe this is a chance for Indian companies to offer an alternative to CATL? 🤔
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Rohit P
The security concerns are valid, but let's be practical. CATL has the best and most affordable LFP battery tech right now. If the US wants to compete in EVs and energy storage, they need that technology. It's a tough balance.
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Sarah B
As an American living in India, I see both sides. The tax credit restrictions make sense to protect national interests. But completely cutting off Chinese tech might slow down the green transition. Ford needs to be transparent.
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Vikram M
The lawmaker's point about China weaponising supply chains is spot on. We saw it with rare earth minerals. Data centres are the new frontier. Having Chinese tech in them is a backdoor waiting to be opened. Ford should reconsider.
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Karthik V
With respect, I think the US is being a bit hypocritical. American companies have operated in China for decades. Now when the tables are turned, it's a "security concern". Global business needs trust, not just one-sided rules.
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Ananya R
This is a wake-up call for

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