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What just happened? Bill Ford, executive chairman of Ford Motor Company, has warned that when it comes to the production of electric vehicles, the United States is still not ready to compete with China. Speaking about China's EV industry during an interview with CNN's Fareed Zakaria GPS, Ford said "They developed very quickly, and they developed them in large scale. And now they're exporting them [...] They're not here but they'll come here we think, at some point, we need to be ready, and we're getting ready."
The US automaker in February announced that it would be investing $3.5 billion in building an electric vehicle plant in Michigan. Reuters writes that the deal will use technology from Chinese battery company Contemporary Amperex Technology Co. Ltd, which led to Senator Marco Rubio asking the Biden administration to review the deal. Ford says the Michigan battery plant is a chance for Ford engineers to learn the technology and use it for themselves.
"It [Michigan] is a wholly owned Ford facility. They'll be our employees, and all we're doing is licensing the technology. That's it." Ford said.
In May, China said it had become the world's biggest exporter of cars after overtaking Japan in the first three months of the year. The country exported 1.07 million vehicles in the period, an increase of 58% compared to the first quarter of 2022, partly due to extra demand from Russia. For comparison, Japan's exports during the first three months of 2023 were 954,185, up 6% year-on-year.
Elon Musk's Shanghai Tesla plant is a big exporter of EVs. It passed the million-vehicles-made milestone last August and is expected to increase its yearly production capacity from 1.5 million.
On Sunday, US Transportation Secretary Pete Buttigieg said the US must take step steps to cut China's advantage in EV batteries, and that building the refining capacity for key materials is "addressable."
Buttigieg added that the US must build relationships domestically and internationally for raw materials and refining capacity. Chinese firms make up more than half of the EV battery market and provide as much as 90% of the demand for some battery materials.
An independent think tank report from earlier this year concluded that China was ahead of the US when it comes to research in 37 out of 44 crucial and emerging technologies, including electric batteries, one of the areas that China has a high risk of monopolizing.