A view of CATL headquarters in Ningde, East China's Fujian Province Photo: VCG

Chinese electric vehicle (EV) battery giant Contemporary Amperex Technology Co Limited (CATL) will provide preparatory and operational services for US car maker Ford Motor's battery plant in Michigan in the US and the two sides have reached a patent licensing agreement for the battery technology, the company told the Global Times on Tuesday. 

According to CATL, the company has accepted the invitation from Ford for cooperation, and the adopted business model that compliments the two sides based on the purpose to deliver the most competitive products to the market.

Chinese Foreign Ministry Spokesperson Wang Wenbin said on Tuesday that normal economic and trade cooperation between Chinese and US enterprises should not be politicized.

Wang made the remarks at a press conference in response to media question over some criticism from the US politicians over cooperation between Ford and CATL. 

Wang urged individuals on the US side to abandon ideological bias, stop generalizing the concept of national security and unreasonably suppressing enterprises from other countries, while providing an open, fair, just and non-discriminatory environment for Chinese enterprises to invest and operate in the US.

According to Bloomberg, Virginia Governor Glenn Youngkin pulled his state from consideration as a location for the factory, calling it a "Trojan horse" for the Chinese Communist Party.

Analysts noted that the cooperation among enterprises operating based on market principles in the two countries will not be prohibited despite the China-US tension and the US' continuous push for an "economic decoupling" with China.

Ford plans to invest $3.5 billion in the EV battery plant in Michigan with 2,500 jobs, and the facility is set to open in 2026 and will produce batteries to power 400,000 EVs a year, Bloomberg reported. 

Ford said it will own and operate the factory and set up a wholly owned subsidiary to run it, while CATL is providing the technology for lithium iron phosphate batteries or LFP batteries, per the Bloomberg report, adding that the plant will become the first in the US to produce LFP batteries. 

Bloomberg reported earlier that Ford and CATL have been weighing a novel ownership structure under which Ford would own 100 percent of the plant, including the building and the infrastructure, as Ford workers would build the batteries while CATL owns the technology to create the cells.

The reported partnership model would enable Ford to receive the subsidies promised in the Inflation Reduction Act (IRA), while CATL could avoid foreign investment security reviews, Lü Xiang, research fellow at the Chinese Academy of Social Sciences, told the Global Times on Monday.

The IRA specified that the US government will offer hefty subsidies to green industries where the bulk of production is completed in the US, while enterprises must use at least 50 percent of parts made or assembled in North America in order to obtain the subsidies, according to media reports. 

Enterprises in the two countries will seek cooperation regardless the unfavorable policies implemented by the US, which is the mainstream for the China-US relation and cooperation, Gao Lingyun, an expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Tuesday. 

Gao added that the policies and strategy implemented by the US to contain China is contrary to US' vaunted market principles, creating obstacles for enterprises from the two sides to work together. 

CATL has been expanding rapidly overseas thanks to the fast adoption of new-energy vehicles globally. 

Earlier in December, CATL announced that its first overseas factory Thuringia, Germany has achieved mass production of lithium-ion battery cells on schedule. 

CATL in September signed a real estate deal with the city of Debrecen in Hungary, marking the official launch of its second European plant, the Xinhua News Agency reported. 

CATL's investment is among the five largest greenfield (foreign) investments made in Europe in the last 10 years, and the largest investment ever in Hungary, according to Xinhua. 

Global Times