Congress Condemns Ford Deal Allowing Chinese EVs to Be Built in Its Factory

Rep. John Moolenaar (R-MI), chair of the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party, on Thursday criticized Ford Motor Company for partnering with Chinese automaker Geely to produce electric vehicles (EVs).

“Ford is actively helping the Chinese Communist Party advance its ambitions to dominate global automotive supply chains and increase the world’s dependence on China,” Moolenaar said.

“This partnership with Geely will further enable China’s decimation of auto markets in Europe as Chinese automakers set their sights on North America,” he continued.

“Ford’s decision is incomprehensible as it seeks protection from Chinese automakers coming to the United States. As I have said before, Ford should work with our nation’s allies, not our adversaries,” he urged.

Moolenaar’s remarks were prompted by Geely and Ford announcing that two models of Geely’s electric sport utility vehicles (SUVs) will be manufactured at Ford’s factory in Spain and the two companies will work together to develop a new model.

One of the Geely models to be produced by the Ford plant in Valencia, Spain, is the EX5, an electric drive “crossover” vehicle (the class of smaller SUVs that fill the automotive spot once held by station wagons). The EX5 is already available for sale in Europe.

Ford currently manufactures a small electric SUV called the Kuga at the Valencia plant and said it will soon begin producing a smaller version of the Bronco SUV tailored for the European market, potentially in both electric and hybrid configurations.

The vehicle to be jointly produced by Geely and Ford was described as a “multi-energy family crossover” and should begin rolling off the lines in 2028.

Ford said the plant in Spain, which is currently underutilized, would probably need to expand and hire more workers to handle Geely’s needs. Geely said it would not bring workers from China to Spain to fill those jobs.

The announcement said that Ford would own 66 percent of the joint venture – or, looked at another way, that Ford will sell 34 percent of the plant to Geely. 

“The joint venture addresses the new realities of the European market – intense global competition, relentless cost pressure and tightening regulation – resetting Valencia to build at the industry’s emerging cost benchmark,” the announcement said.

“This JV (joint venture) with Ford in Europe reflects our commitment to open, collaborative product development as part of our growth strategy, deepening our local presence and commitment to customers in Europe,” said Geely Vice President Alex Nan.

“Put simply: We are building cars in Europe, for Europe, alongside a trusted partner,” Nan said.

Ford spokesman Dave Tovar responded to Moolenaar’s criticism by insisting that “no company has done more to advance the U.S. auto industry than Ford.”

“Over in Europe, the landscape is changing fast and we are competing head-on with the Chinese and every other major global automaker.  This new reality is forcing every car company to get radically leaner and smarter, which is exactly what we’re doing with our plant in Valencia,” Tovar said.

Reuters on Thursday noted that Chinese automakers are “racing to find space in factories on the continent to make their vehicles ahead of upcoming European Union legislation that will have a ‘Made in Europe’ clause, mandating minimum local content in electric vehicles.”

Companies like Ford are only too happy to sell China the production capacity it needs in Europe because their own sales have cratered. Ford, for example, was selling a million cars a year in Europe in the 2010s, but less than half that many today.

The Associated Press (AP) added that China’s dramatic slowdown in domestic consumption leaves it hungry to crack into foreign markets, especially Latin America and Europe.

At the same time, American carmakers have been disappointed by sluggish EV sales in the United States – especially after the Trump administration reversed Biden-era policies that were basically forcing American consumers to buy EVs. These U.S. companies would welcome Chinese capital infusions to keep their businesses afloat in Europe, as would struggling European manufacturers.

Jessica Caldwell, head of insights at the Edmunds auto research firm, told the AP that the Ford-Geely deal “underscores a major industry shift we’re likely to continue seeing: automakers can no longer go it alone and must collaborate with rivals – Chinese or otherwise – to survive the capital-intensive transition to electrification.”

AutoForecast Solutions Vice President Sam Fiorani predicted that if Ford cannot “learn how to cut costs and develop lower-priced vehicles,” it may end up “selling plants outright rather than sharing them.”

Adam Ragozzino, principal battery and powertrain analyst for the Omdia analytics firm, said the current U.S. strategy of holding the tidal wave of cheap Chinese EVs at bay with tariffs and protectionist regulation is doomed to fail, because it does not help “domestic automakers sharpen their dull competitive edge.”

“Instead, this protective wall blocks the vital transfer of technology and operational know-how that Chinese EV leaders possess and Detroit desperately needs,” he argued.