Ford's CEO Claims China is 10 Years Ahead of the US in EV Batteries and Requires Their Intellectual Property | Carscoops

      According to Jim Farley, the CEO of Ford, licensing battery technology from China is crucial for remaining competitive with Chinese automakers and eventually surpassing them.

      Farley stated in an interview with The New York Times that Chinese manufacturers are significantly ahead of their Western counterparts in battery technology. He emphasized that Ford needs to tap into China's battery intellectual property (IP) if it intends to stay relevant in the automotive market.

      CATL's batteries utilize lithium iron phosphate (LFP) chemistry, which was initially developed in the U.S. but later acquired by China.

      To counteract the challenges posed by the Chinese automotive industry, Ford must rely on China's technical knowledge, according to Farley.

      Farley mentioned in his conversation with The New York Times that China has a considerable lead in the production of batteries for electric vehicles (EVs), and asserted that Ford's best chance of achieving parity with the Chinese auto sector—and ultimately gaining an advantage—is to utilize their technology.

      “The way we compete with them is to get access to their IP just as they needed ours two decades ago, and then employ our innovative ecosystem, American ingenuity, extensive scale, and strong customer connection to outpace them on a global scale,” he told Thomas L. Friedman from the NYT. “This will be a critical competition in preserving our industrial economy.”

      Farley's remarks are not about a distant future strategy but rather about ongoing developments. Ford’s extensive BlueOval Battery Park is currently under construction and is set to produce thousands of lithium-ion phosphate (LFP) batteries using technology sourced from China’s CATL when it launches in 2026.

      While it was known that Ford is leveraging American resources, there's a less familiar aspect regarding CATL’s savvy chemistry: it was initially created in the U.S. before being acquired cheaply by Chinese firms. Citing an earlier Bloomberg article, the NYT highlights that LFP was discovered by researchers at the University of Texas and later commercialized by A123 Systems LLC, a startup that received substantial funding from the Obama administration.

      However, the slow growth of the EV market led to A123's bankruptcy, with its remnants—including battery IP—eventually bought by what was then the largest auto parts company in China.

      Some may argue that hindsight is valuable and that it was difficult to foresee a decade ago how integral EVs would become in the automotive sector. Yet, the Chinese anticipated this shift, and Tesla recognized it before other Western manufacturers. Major automakers were already developing EVs, aware of the necessity to produce them in large volumes to meet emission targets.

      Reflecting from a 2025 perspective, it appears astonishing that such technology was permitted to leave U.S. control and fall into the hands of one of its primary competitors, which, according to the Bloomberg report, dominates 83 percent of global lithium-ion battery manufacturing.

      Ford is aiming to create an EV priced under $30,000 to compete with affordable electric vehicles from China that have not yet entered the U.S. market but are already impacting sales in other regions where Ford operates. While tariffs on vehicles imported from China protect Ford from immediate competition from brands like BYD in the U.S. (for the time being), these tariffs also increase the cost of the Chinese-built Lincoln Nautilus for U.S. dealers.