Trump's Transportation Secretary Blasts Ford's Chinese Battery Deal

Sean Duffy calls Ford's CATL partnership a national security risk, marking intensifying administration pressure on Detroit automakers to sever Chinese supply chains.

Transportation Secretary Sean Duffy sent a letter to Ford CEO Jim Farley on Tuesday expressing "profound concern" at multiple deals between the automaker and Chinese companies, specifically targeting Ford's technology licensing agreement with battery manufacturer CATL at its BlueOval Battery Park in Marshall, Michigan. Duffy cited CATL's inclusion on the Pentagon's list of companies accused of ties to China's military, arguing that Ford is undermining U.S. automotive independence by relying on licensed Chinese battery technology. The letter also criticized Ford's partnerships with Chinese automakers Geely and BYD, as well as the company's plan to continue manufacturing some Lincoln Nautilus in China until 2030. Ford's CATL partnership, originally announced in 2023, involves a licensing deal for lithium iron phosphate battery technology under which Ford owns and operates the Michigan plant. The facility began production in June 2026 after facing earlier political setbacks under the first Trump administration. Ford has invested approximately $2 billion in the 20 GWh plant, which produces batteries for the company's EV lineup and energy storage systems. Ford pushed back immediately, calling Duffy's letter a "wrongheaded attempt to capture headlines" and asserting that it contained "factual errors." The company emphasized that it owns the plant outright, controls its operations, and employs the workforce—rejecting characterization of the arrangement as a joint venture or foreign-owned operation. Ford also highlighted that the facility created 1,700 jobs and that it is producing Michigan-made batteries rather than importing them. The confrontation reflects the Trump administration's broader effort to pressure American automakers to decouple from Chinese suppliers through tariffs and public criticism. Earlier this year, Congressman John Moolenaar, chair of the House Select Committee on China, voiced similar concerns about Ford's deals with both Geely and CATL. The administration has already terminated EV tax credits and relaxed fuel economy standards, moves that cost Ford $19.5 billion in impairment charges on its EV assets.

How could this affect you

Traced by who's actually in the path of this — not everyone is.

Likely

Investors in Ford and U.S. auto suppliers

Escalating White House pressure on Ford's Chinese partnerships could force renegotiation or termination of the CATL deal, disrupting battery sourcing and increasing production costs if Ford must rebuild supply chains domestically or shift to non-Chinese suppliers.

Possible

U.S. battery and EV technology companies

Administration hostility to Chinese battery technology could accelerate development of competing domestic LFP battery capability and increase federal support for American-owned alternatives, potentially creating commercial opportunities.

Possible

Buyers of Ford EVs and energy storage products

If Ford is forced to abandon the CATL licensing arrangement, battery costs and availability could shift; alternatively, the dispute could delay production timelines or reduce the company's battery output capacity.

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Chanakya's Move

Whose move this was, what they're betting on, what could counter it.

This is a Trump administration strategic play designed to test whether a major American automaker will buckle under political pressure to decouple from Chinese supply chains. By targeting Ford publicly and naming CATL's military ties, Duffy is signaling that Chinese partnerships—even licensed technology arrangements—will face escalating costs in the form of regulatory scrutiny and reputational damage. Ford's quick, defensive response shows the company is calculating that breaking the CATL deal would be costlier than weathering the political attack. But the administration is betting it can eventually prevail through cumulative pressure: tariff threats, policy reversals (like the EV tax credit termination), and congressional inquiries. The move also sends a signal to other Detroit automakers that any Chinese technology reliance invites regulatory targeting. Ford's defense—that it owns the plant and is producing domestically rather than importing—is the strongest counter, but may not be enough if the administration decides to escalate further.