Korean media: "Without China, the development of American electric vehicles would be inconceivable!"
On May 2, South Korea's economic publication Global Economy published an article stating that CEO Zheng Yujun of Contemporary Amperex Technology Co. Limited (CATL), the world's largest EV battery manufacturer, expressed strong confidence in the U.S. market.
He argued that without China’s battery supply chain, America’s transition to electric vehicles would be nearly doomed to fail, and current protectionist measures would ultimately lead to technological backwardness in the United States.
According to CleanTechnica, a U.S. renewable energy media outlet, despite high tariffs and political pressure, major American automakers Ford and General Motors continue to deeply integrate CATL’s technology and products to maintain price competitiveness.
The U.S. government is pushing to exclude Chinese batteries through legislation such as the Inflation Reduction Act, yet industry insiders tell a completely different story.
Although lithium iron phosphate (LFP) batteries were originally invented in the United States, China has been the pioneer in commercializing them and perfecting large-scale production processes. Ford executive Lisa Drake acknowledged a significant technological gap between China and the U.S., admitting: “If we rely solely on our own efforts, it might take us up to ten years to reach today’s level of LFP battery technology.”
The Chinese EV market accounts for more than half of global sales, creating substantial economies of scale that have significantly reduced battery costs. In contrast, the smaller U.S. market has not benefited from this effect, remaining far behind in cost-competitive manufacturing.
Recently, Ford decided to adopt CATL’s technology at its new battery plant in Michigan instead of partnering with South Korea’s SK On. By holding 100% ownership of the facility and paying intellectual property usage fees to CATL, Ford has effectively introduced Chinese technology into its domestic market.
To reduce the price of the 2027 Chevrolet Volt model, General Motors is willing to pay tariffs as high as 60%, directly importing batteries from CATL in China.
The $2 billion battery factory GM invested in has already gone idle, so the company now views importing batteries from China as actually more economical.
With CATL shifting its focus toward mass-producing next-generation sodium-ion batteries, most experts predict that by the time the U.S. masters LFP battery technology, the technological gap between China and the U.S. will only widen further.
Industry analysts warn that the U.S.’s stringent restrictions on China may actually weaken the global competitiveness of the American auto industry.
Zheng Yujun said: “In the end, U.S. policies will change. Electric vehicles represent an inevitable future, and the industry will surely prosper.”
If the global market adopts China’s low-cost, high-efficiency battery standards while the U.S. continues building its own ecosystem, American automakers risk falling into high-cost traps and becoming isolated from the global market.
The reason Ford and GM are turning to Chinese LFP batteries rather than South Korean NCM batteries ultimately comes down to one factor: price. The three major South Korean battery manufacturers must accelerate the mass production of affordable LFP batteries and manganese-rich batteries to counter China’s pricing pressure.
As Ford’s case illustrates, a collaboration model based on “technology licensing” may become the new standard. South Korean firms must also move beyond simple manufacturing and actively pursue profitable models centered around core process technologies or patents.
Original source: toutiao.com/article/1864040498100227/
Disclaimer: This article represents the personal views of the author.