Ford CEO Warns US Against Repeating Europe’s Mistakes With Chinese Automakers

Ford CEO Jim Farley is warning U.S. policymakers to proceed cautiously before allowing Chinese automakers greater access to the American market, pointing to Europe as an example of how quickly Chinese manufacturers can gain ground.

Speaking at an Automotive News conference in Detroit, Farley said Chinese automakers have become formidable global competitors and are putting increasing pressure on established European manufacturers. “It is too late for the European countries,” Farley said, according to a Reuters report published Sept. 29.

China is expected to export roughly 12 million vehicles in 2026, compared with about 3 million in 2022, Reuters reported. Chinese manufacturers have expanded aggressively across Europe and other overseas markets with competitively priced vehicles featuring increasingly sophisticated battery and digital technology.

Farley, however, is not advocating a complete break with China’s auto industry. Ford is working with Chinese battery giant CATL to produce lower-cost batteries in Michigan, and Farley said the company will cooperate with Chinese firms where Ford lacks technology or where partnerships make financial sense.

At the same time, he said Ford intends to compete with Chinese manufacturers “directly.”

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The approach reflects the difficult position facing U.S. automakers: Chinese companies can be important technology partners while simultaneously emerging as some of their most serious global competitors.

Proposed restrictions raise questions over Mercedes and Volvo

Washington is meanwhile considering measures that could make the existing barriers against Chinese vehicles more permanent.

A bill approved by the Senate Commerce Committee in July would prohibit vehicles made by companies with more than 15 percent Chinese ownership from being sold in the United States, according to Reuters.

But the proposal has created an unexpected problem. Nearly 20 percent of Mercedes-Benz is passively held by Chinese investors, potentially putting the German automaker above the proposed threshold.

Sen. Bernie Moreno (R-Ohio), one of the bill’s sponsors, said lawmakers are working to prevent the legislation from producing that result.

“We’re obviously not going to ban Mercedes-Benz cars from being sold in the United States,” Moreno told Reuters.

Volvo presents an even more complicated case because its largest shareholder is Zhejiang Geely Holding Group of China. Reuters reported that lawmakers are also examining how Volvo could remain in the American market under the proposed legislation.

The issue forces Congress to draw a distinction between Chinese automakers themselves and established foreign manufacturers that have substantial Chinese ownership.

Chinese-made vehicles already face major obstacles in the United States, including tariffs exceeding 100 percent and federal restrictions targeting Chinese technology used in connected vehicles.

US auto industry pushes for permanent barriers

The American auto industry is urging Congress to go further.

The Alliance for Automotive Innovation, which represents most major automakers operating in the United States, called on congressional leaders in September to enact a permanent prohibition on Chinese connected vehicles and associated software and hardware before the end of the current Congress.

In a Sept. 3 statement, Alliance President and CEO John Bozzella said China is exporting subsidized vehicles equipped with connected technology around the world and gaining market share in Europe, Australia, Southeast Asia, Mexico and South America.

“This hasn’t happened inside the U.S. yet,” Bozzella said, while urging lawmakers to make restrictions on Chinese vehicles and technology permanent.

The group argues that the issue extends beyond competition over vehicle prices and includes the large volumes of data generated by increasingly connected cars.

China’s industrial position is already substantial. According to the Alliance’s latest U.S. electric vehicle report, China produced roughly 70 percent of the world’s electric vehicles and more than 80 percent of global battery cells in 2025.