Detroit vs. Reality: Are Chinese Partnerships Inevitable For U.S. Automakers?

This past weekend, the Financial Times reported that Ford held talks with Chinese gadget titan turned electric vehicle maker Xiaomi about a potential joint venture.

The discussions, while preliminary, would have included plans to manufacture EVs in the United States.

Ford’s denial of the story was swift and vehement, perhaps unusually so: “This story is completely false. There is no truth to it,” the automaker said. Xiaomi said as much as well.

The story also said Ford has spoken with BYD and other Chinese automakers about partnerships. But it didn’t end there.

A few days later, Reuters reported that Ford and Geely—the Chinese parent company of Volvo, Polestar and many other brands—are in discussions about a potential partnership, this time for European car manufacturing.

Geely could gain access to Ford factory space in Europe, the story said, and the two reportedly also discussed “shared vehicle technologies, including for automated driving.”

This time, Ford demurred, saying it has “discussions with lots of companies all the time” that may or may not go anywhere.

Chinese EVs are perhaps the most advanced consumer products that Americans have almost no experience with, thanks to stiff 100% tariffs.

And they aren’t just kept out by tariffs: heavy restrictions exist for connected software and hardware on national security grounds.

But that would be surmountable from a policy perspective if there was enough commercial interest, as perhaps the recent deal around TikTok showed.

(By the way: the Trump administration also recently pushed out the official responsible for those rules.)

And Western automakers are already working with Chinese ones more than most realize—especially as they struggle to compete in China.

Volkswagen has tapped tech-savvy startup Xpeng for its EV architecture and software needs in China, much as it is partnering with Rivian for that in the West.

VW and other automakers are also turning to local Chinese automakers FAW and SAIC to essentially build their cars for a Chinese audience. GM’s Chinese EV platform was co-developed with SAIC. And Toyota now has a whole range of EVs in China via team-ups with the likes of FAW, GAC and BYD.

This partnership strategy is often called “in China, for China.” But it goes deeper: Stellantis’ big bet is bringing China’s Leapmotor brand to Europe.

Ford is already doing this, to some extent. Its LFP battery factory in Michigan is a joint venture with China’s CATL (though that’s more a legal necessity due to CATL’s iron grip on battery patents).

It’s truly difficult for me to see these partnerships staying “in China, for China” for the long haul. 

Joint ventures could give Western automakers access to groundbreaking technology they’d otherwise spend billions trying to develop themselves, with no guarantee of success.

Besides, China’s automakers forced Western ones into joint ventures decades ago—the U.S. could be savvy to require a similar move. 

Any will to make this happen would run afoul of China hawks on both sides of the American political aisle. 

But Trump has a unique penchant for pushing things through, especially if he felt a better trade deal with China—or a shot at more U.S. manufacturing jobs—were on the table. 

And if the choice is that, or contend with a flood of cheap Chinese imports like we’re about to see in Canada, wouldn’t the team-up be the better option? That may be how things go, either this year or sometime soon. 

As I mentioned, there's lots more to come next week on the Rivian R2. But here’s a preview of what to expect, and why it matters so much. [CNBC]

Volkswagen has overtaken Tesla in European EV sales for 2025. [Yahoo Finance]

Wins for the outgoing National Automobile Dealers Association chairman include the Trump administration’s weakened fuel economy rules. [Automotive News]

Slate’s CEO isn’t worried about cheap Chinese EVs as competition for its $25,000-ish electric truck, my colleague Tim Levin reports. [InsideEVs]

I’m watching this SpaceX and xAI merger very carefully, with my eyes on one crucial question: What, if anything, could this mean for Tesla? [Barron’s]

Michigan’s lawsuit against Big Oil, alleging a conspiracy to stifle clean energy, is different from previous attempts because it targets antitrust laws. How will that play out? [Heatmap News]

Kia’s EV sales are taking a bruising without the tax credit in America. What does this mean for the EV3 or other planned future models? [InsideEVs]

China has formally banned concealed door handles, amid safety concerns with EVs in particular. So what will future door designs look like? [Bloomberg]

Speaking of CATL: it swears that repeated fast charging won’t kill its new 5C batteries, designed to retain 80% capacity after 1.1 million miles. [InsideEVs]

America’s EV charging network may be growing fast, but California still has an almost threefold lead on chargers vs. the runner-up, New York. [USA Today]

Boston Public Schools is installing 105 DC fast chargers as it moves to an all-electric school bus fleet. [Electrek]

How Toyota developed the equipment for the NACS transition in-house rather than use off-the-shelf components to ensure everything met the automaker’s famous durability requirements. [Toyota Newsroom]

Speaking of that Ford-CATL partnership, it’s under additional scrutiny by the Republican chair of a U.S. House committee on the CCP. [CBT News]

Ford is working with the state of Kentucky to sell a second, unused plant at the BlueOval SK battery factory site. [Courier-Journal]

Toyota's working on a better way to put batteries into EVs, per a new patent application. [Car and Driver]

Similarly, cell-to-body—where structural elements of an EV battery can be integrated into the chassis itself—is the hot new thing in design. [CleanTechnica]

The world’s first sodium-ion battery (in a Chinese car, of course) could be transformational for reducing fire risks and boosting cold-weather range. [InsideEVs]

The big one: Waymo announced a $16 billion funding round that values the company at $126 billion. [CNBC]

Is Tesla’s Robotaxi service really free of human safety minders? It took this guy 58 rides in Austin before he got a car without one. [KXAN]

Meanwhile, a Wolfe analyst says Tesla’s Robotaxis could bring in $250 billion in revenue by 2035—assuming Tesla gets 50% of the AV market. [Motley Fool]

Americans are warming up to robotaxis, one study shows. But only when they show up in their cities. [InsideEVs]

Are Waymo’s remote tele-operators really drivers? [Phil Koopman Substack]

The big problem facing AVs continues to be edge cases, not so much regular, daily driving. [Tech Brew]

AI is changing how dealers detect and fix customer trust problems. [Car Dealership Guy]

Why Hyundai’s CEO is making such an aggressive bet on robotics. [Wall Street Journal]

If you’re old enough to read this newsletter and care what’s in it, here’s why you probably won’t live to see a day when all cars are totally autonomous. [Zag Daily]