GOP House Leaders Investigate Ford Battery Agreement
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WASHINGTON — Republican congressional leaders have sent a letter to Ford Motor Co. CEO Jim Farley claiming they had received documents showing hundreds of jobs at the company’s planned battery plant in Marshall will go to employees of a Chinese battery firm.
The lawmakers also wrote in the July 20 letter that Chinese battery giant Contemporary Amperex Technology Co. Ltd. — which has a licensing agreement with Ford to provide battery cell technology to the plant — may have attempted to obscure connections to forced labor in China.
It is the latest in a string of challenges from Republican lawmakers to the project, which is expected to create 2,500 jobs and be the first U.S. automaker-backed plant to use lithium iron phosphate technology, which can make batteries last longer. When complete, it will be able to build enough batteries to power about 400,000 electric vehicles each year.
The letter was signed by Rep. Mike Gallagher (R-Wis.), who leads the House Select Committee on China, and Rep. Jason Smith (R-Mo.), who chairs the Ways and Means Committee. They asked for copies of the licensing agreement and communications between Ford and CATL, as well as communications between Ford and the Biden administration.
“Ford has argued that the deal will create thousands of American jobs, further Ford’s ‘commitments to sustainability and human rights,’ and lead to American battery technology advancements,” Gallagher and Smith wrote in the letter. “But newly discovered information raises serious questions about each claim.”
Ford spokesperson Melissa Miller said the company officials have received, are reviewing “and look forward to responding” to the lawmakers’ letter.
Ford has said it is paying CATL for the right to use its proprietary technology and its counsel in applying that technology. They have also noted that competitors such as Tesla Inc. and Honda Motor Co. import batteries directly from CATL, which Ford has also done.
“We’re creating 2,500 new U.S. jobs while helping to strengthen domestic manufacturing and supply chains and reduce carbon emissions,” Miller said via email. “This is good for our country, good for the planet and good for Ford’s business.”
The lawmakers said they received details of the licensing agreement that shows “several hundred” of the 2,500 jobs in the Marshall plant will be given to CATL employees from China who will set up and maintain the equipment, and that Ford will keep CATL employees working in the plant until around 2038.
BREAKING: Chairman @RepGallagher and @RepJasonSmith of @WaysandMeansGOP seek answers on @Ford’s partnership with Chinese Communist Party-aligned battery company @catl_official.
In the letter, the Chairmen reveal NEW information about the licensing agreement, CATL’s ties to… pic.twitter.com/9d3tnDDH4y — The Select Committee on the CCP (@committeeonccp) July 21, 2023
When asked by The Detroit News about the number of American and Chinese employees expected to be on site, Miller said the company will have “a select number of CATL technical experts on site” but that “these workers will not be counted among the 2,500 new U.S. jobs created by this project.”
Lisa Drake, a Ford executive working on electrification efforts, said in February that equipment for the plant will come from “various locations” and that the company will domestically source as much as it can.
“There will be CATL personnel on site, somewhat to help with (the) install,” she said. “It is predominantly the Ford team that will be doing most of that work, but we need their help and some of them will be staying on afterwards to help with the facility.”
Gallagher and Smith also wrote that CATL has an “ongoing relationship” with a lithium company that is “implicated in forced labor.”
Shortly after Ford announced its licensing agreement with CATL in February, the Chinese company divested a 23.6% stake in Xinjiang Lithium, the lawmakers wrote. Two days later, a limited partnership managed by a former CATL senior manager and one-third funded by CATL purchased a 61.2% majority stake in the lithium company that has subsidiaries that participate in “state-sponsored labor transfer programs” in Xinjiang that move workers directly from camps to factories and constantly surveil them.
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The lawmakers also argued that the licensing agreement (rather than a joint venture) allows Ford to benefit from taxpayer-funded subsidies for battery production and consumer EV discounts.
“We are concerned that the deal could simply facilitate the partial onshoring of PRC-controlled battery technology, raw materials, and employees while collecting tax credits and flowing funds back to CATL through the licensing agreement,” they wrote.
Ford has said those assertions are “categorically false” and that CATL will receive no U.S. tax dollars.
