Ford faces congressional scrutiny over Chinese battery partnership

On the Dash:

• A U.S. lawmaker is questioning Ford’s partnership with Chinese battery maker CATL.
• Ford plans to repurpose Kentucky and Michigan plants for LFP and energy storage batteries.
• National security, licensing agreements, and tax credit eligibility are central concerns.

Ford is under congressional review for its partnership with Chinese battery manufacturer CATL, which involves repurposing U.S. battery plants to produce lithium iron phosphate cells and grid-scale energy storage systems. The plan also supports Ford’s entry into the data center battery market.

Representative John Moolenaar, Republican chair of a U.S. House committee, sent a letter to Ford CEO Jim Farley requesting details on the partnership. He questioned whether licensing agreements with CATL have been modified since new eligibility restrictions were enacted under U.S. law last year. Moolenaar also sought clarity on any potential joint ventures with Chinese automaker BYD, citing national security risks tied to foreign control of automotive supply chains.

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The scrutiny follows Ford’s December announcement of a $19.5 billion write-down and the cancellation of several EV models. The automaker plans to repurpose its Kentucky and Michigan battery facilities to produce energy storage system batteries and expand LFP production for U.S. markets. Initial production capacity is expected within 18 months. Ford stated that the move is an investment in American workers, local economies, and domestic energy security, and that its batteries meet the eligibility requirements for federal tax credits.

Ford’s plans build on a 2023 announcement to construct a $3 billion battery plant in Marshall, Michigan, using CATL technology. That facility will also supply batteries for Ford’s $30,000 midsize EV truck, marking a shift in the company’s EV and energy storage strategy.

The issue highlights the intersection of national security, energy policy, and automotive manufacturing as U.S. lawmakers evaluate foreign involvement in critical supply chains. Questions about licensing, joint ventures, and eligibility for federal incentives could influence the timeline and structure of Ford’s battery operations in the coming years.