House Energy Committee Republicans want to review Ford’s agreement with a Chinese battery maker.
Republican Lawmakers Seek Review of Ford’s Licensing Agreement with Chinese EV Battery Maker
Dozens of Republican House Energy and Commerce Committee members are calling for a thorough review of the licensing agreement between Ford Motor Co. and a Chinese electric vehicle battery maker. Led by committee chair Rep. Cathy McMorris Rodgers (R-Wash.) and Oversight Subcommittee Chair Morgan Griffith (R-Va.), the lawmakers have sent a letter to Ford’s CEO James Farley, requesting a copy of the licensing agreement and all communications related to the deal’s eligibility for tax credits.
The Republicans express concerns that Ford’s partnership with the Chinese EV battery maker could potentially aid China’s efforts to expand its control over the United States’ electric vehicle supply chains, posing a threat to national security and furthering dependence on China. They emphasize that these national security risks become particularly serious during times of escalating geopolitical tensions.
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In February, Ford announced its plans to build a new $3.5 billion plant in Marshall, Michigan, to produce lithium-iron-phosphate (LFP) batteries. The plant, located 100 miles west of Detroit, will be owned by a wholly owned subsidiary of Ford and will employ workers. As part of a licensing agreement, China’s Contemporary Amperex Technology Co. Ltd. (CATL), the world’s largest manufacturer of EV batteries, will provide the EV battery technology, equipment, and workers. Production is expected to begin in 2026, with the plant estimated to produce enough batteries for 400,000 EVs annually.
Ford has confirmed that it expects the deal to qualify for both consumer and advanced manufacturing credits under the Inflation Reduction Act (IRA). Experts estimate that the manufacturing credit could reach $1 billion, and without the tax credit, Ford would not be able to afford the $3.5 billion investment.
House Energy Committee Republicans are raising questions about Ford’s decision-making process and the potential exploitation of federal incentives under the IRA, which were designed to promote domestic EV supply chains.
A Ford spokeswoman responded to the concerns, stating, “Ford alone is building and will own and run this battery plant in Michigan. We’re doing that instead of putting a Ford battery factory in another country or exclusively buying batteries made in China, like our competitors do. Ford has no ’partnership’ with CATL; they won’t own any portion of the plant. We’re licensing their battery cell technology for use by Ford in the U.S. and will contract with them for specific services, nothing more.”
She further emphasized that the project will create 2,500 new American jobs and strengthen U.S. manufacturing, benefiting customers, the country, and Ford’s business.
The Ford-CATL deal raised security concerns even before its announcement, leading Virginia Republican Gov. Glenn Youngkin to withdraw his state from bidding to house the battery plant due to fears that it could become a front for China. Republican lawmakers have since called for reviews of the deal to assess national security risks.
About two months ago, Rep. Mike Gallagher (R-Wis.) and Rep. Jason Smith (R-Mo.), the respective chairmen of the House Select Committee on China and the House Ways and Means Committee, also wrote to Mr. Farley, seeking to review the licensing agreement. They share concerns that the deal could facilitate China’s global dominance in EV battery technology using U.S. taxpayers’ money and increase America’s reliance on Chinese critical resources.
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