Two chairmen of US House committees have called on the Biden administration to conduct an investigation into four Chinese companies associated with Ford Motor Co.’s battery plant in Michigan. Last year, Ford announced a licensing agreement with Chinese company Contemporary Amperex Technology Co. Ltd. (CATL) to utilize their lithium-iron-phosphate battery technology for electric vehicles, which are cheaper and less prone to fire risks. Despite Ford independently building and operating the plant in Michigan, some Republican politicians have expressed concerns that American tax subsidies may end up in China.
The Chinese Communist Party Committee and the House Energy and Commerce Committee have now sent letters to the US Departments of Commerce and Treasury, urging them to examine the supply chain connections of the four companies they believe are involved in Ford’s plant project. The committee chairmen claim that these companies have ties to the Chinese military, the Chinese Communist Party, the North Korean government, and the violation of human rights of Uighurs in the Xinjiang region of China, although China denies these allegations. The names of these companies have been redacted in the shared letters.
One of these companies is involved in the conceptual design of the plant, according to the letters. The remaining three are involved in IT services. Republican representatives Mike Gallagher from the Chinese Communist Party Committee and Cathy McMorris Rodgers from the Energy and Commerce Committee have called for a review of potential export restrictions.
“It is unethical for Ford to purchase critical IT infrastructure from a Chinese company that facilitates sanctions evasion on behalf of the North Korean government,” wrote Gallagher and McMorris Rodgers. “This poses significant cybersecurity threats.”
In a letter sent to Ford’s CEO, Jim Farley, a representative of the company was also urged to discuss the due diligence process related to the agreement with CATL.
“We have explained to the committees how this Ford-owned and operated project works,” said Ford spokesperson T.R. Reid. “We comply with all government regulations related to our business. In addition to legal requirements, Ford’s true suppliers must also meet our higher standards of conduct, including human rights protection, and are obligated to extend these standards to any potential suppliers they work with.”
According to Reid, all the details of the licensing agreement with CATL have not been finalized yet.
In November, Ford reduced its investment in the Michigan plant after a two-month pause in operations, citing a slowdown in electric vehicle demand. Initially, Ford had planned a $3.5 billion investment but reduced its production capacity by nearly half.
FAQ:
Q: Why did two chairmen of US House committees call on the Biden administration to conduct an investigation?
A: To examine the supply chain connections of four Chinese companies associated with Ford’s plant in Michigan.
Q: What are the concerns of Republican politicians?
A: They are concerned that American tax subsidies may end up in China.
Q: Which entities are associated with this project?
A: Preliminary letters indicate one company’s partnership in the project, while the remaining three companies provide IT services.
Q: What is the role of the Chinese Communist Party Committee and the House Energy and Commerce Committee?
A: They have sent letters to the US Departments of Commerce and Treasury, urging them to examine the supply chain connections of the four companies.
Q: What allegations are made against these four Chinese companies?
A: They are accused of having ties to the Chinese military, the Chinese Communist Party, the North Korean government, and the violation of Uighur human rights.
Q: What cybersecurity threats do Republican representatives see?
A: They believe that purchasing critical IT infrastructure from a Chinese company poses significant risks.
Q: How does Ford respond to these allegations?
A: Ford states that it complies with all government regulations regarding its business and requires suppliers to meet higher standards, including human rights protection.
Q: What are the investment changes in Ford’s Michigan plant?
A: Ford reduced its investment from the initially planned $3.5 billion and decreased production capacity by nearly half.
Key Terms:
1. Investigation – the act of examining and researching something to obtain information.
2. Chinese Communist Party – the ruling political party in the People’s Republic of China.
3. Ford Motor Co. plant – a factory owned by Ford Motor Co. that produces batteries.
4. Licensing agreement – an agreement to use a specific product or technology based on a license.
5. Lithium-iron-phosphate battery technology – a technology used in the production of batteries for electric vehicles.
6. Fire risks – the possibility of fire occurrences.
Suggested related links:
– ford.com
– treasury.gov
The source of the article is from the blog elperiodicodearanjuez.es