US Transportation Secretary Sean Duffy wrote to Ford CEO Jim Farley on 8 September 2026 to say his department is "deeply alarmed" by how far Ford has tied itself to Chinese suppliers. The letter opens by expressing "the profound concern of the U.S. Department of Transportation (DOT) regarding the strategic trajectory of Ford Motor Company", and it singles out the arrangement that keeps Ford's Michigan battery plant running.
What the letter objects to
The central complaint is a licence. Ford's plant at Marshall, Michigan builds LFP cells using technology licensed from CATL, the Chinese company that dominates that chemistry. Duffy names two other ties: Geely, Ford's partner in a Spanish joint venture, and BYD, over hybrid components.
His objections are twofold. The first is data — Chinese law can compel companies to give the state access to proprietary and customer information, which DOT frames as a national-security exposure. The second is industrial: that leaning on Chinese manufacturing costs American jobs, and that "iconic American companies, like Ford, are also expected to out-innovate competitors" rather than license their way to a product line.
The sharpest line is about reliability as a counterparty: "When a company intentionally chooses to deepen operational dependencies on strategic competitors, it fails to act as the reliable partner the American public and this DOT require." No deadline or formal response request has been reported.
Ford's answer
Ford rejected it flatly, calling the letter "a wrongheaded attempt to capture headlines" and saying it contains factual errors. Its substantive defence is about structure: the CATL arrangement is "a limited technology-licensing and services agreement, not a joint venture". Ford also denies proposing the framework for Chinese joint ventures on US soil that the letter describes, and notes the White House praised the Marshall project the week before.
Tesla picked the other structure
Tesla appears nowhere in the letter or in the coverage of it. That is the interesting part, because Tesla builds LFP cells in the United States too, and it also got there through CATL.
| Ford, Marshall MI | Tesla, Nevada | |
|---|---|---|
| Arrangement | Technology licence plus services | Outright purchase of production equipment |
| CATL's ongoing role | Licensed IP, service agreement | Helped install; no role operating the line |
| Output | Vehicle cells | ~10 GWh/year, initially Megapack and Powerwall |
| Status | Producing | Early-stage ramp, per Tesla's Q1 2026 SEC filing |
Tesla bought the machines and kept everything else. Reporting when the deal was struck read that as a deliberate move to stay clear of exactly the scrutiny Ford is now absorbing. Whether or not that was the motive, it is the distinction the letter turns on: Duffy is attacking a licence, not the presence of Chinese-built tooling on American factory floors.
Europe is pulling the other way
Washington treats Chinese technology licensing as a liability to be unwound. Brussels has treated it as the objective — the mechanism by which European firms might acquire cell-making capability they lack, attached as a condition to grants and market access.
Neither side has got what it wanted. Transport & Environment found no EU-wide or national technology-transfer requirements actually attached to Chinese-European battery partnerships despite substantial state aid, and no meaningful skills transfer in the VW–Gotion and CATL–Stellantis tie-ups. TeslAnt has covered how loosely such conditions bind, including the environmental exemptions Hungary granted CATL and BYD.
Why a Tesla owner should care
The Nevada line is an energy-products line first, and Tesla sells Megapack and Powerwall into Europe. A US policy turn that makes licensed Chinese cell technology politically radioactive raises the value of domestic LFP capacity carrying no licence — which is what Tesla is ramping.
It also sets a template. If Washington's line is that buying the tooling is acceptable while licensing the IP is not, every automaker wanting LFP cells without a Chinese partner now has a worked example of the permitted structure, and it is Tesla's.