Key insights
- Ford and Geely's stalled talks about extending their European partnership to the U.S. highlight the challenges Chinese automakers face entering the U.S. market due to tariffs and political opposition. While a deal could represent a novel Detroit-China partnership, current trade tensions and domestic protectionist sentiments present headwinds for such collaborations, posing a slight negative risk to Ford's stock.
Investing.com -- Ford Motor and Chinese automaker Geely held talks earlier this year about potentially extending their European partnership negotiations to the U.S., according to a Friday report by the Wall Street Journal.
The talks, which involved Ford potentially licensing Geely's technology in the U.S., have stalled in recent months. The two companies are now concentrating on finalizing a deal to share technology and manufacturing capacity in Europe.
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Geely seeks to expand into the profitable U.S. market, where Chinese automakers face significant barriers. The U.S. imposes substantial tariffs on Chinese-made vehicle imports and prohibits Chinese connected-vehicle software.
Domestic carmakers are asking the Trump administration and Congress to maintain restrictions on Chinese brands, viewing them as a threat to the industry.
Ford CEO Jim Farley said last week that Chinese-made cars should not be permitted into the U.S. until there is a plan to protect jobs.
In a recent Fox News interview, President Trump called the 100% tariffs on Chinese-made cars that President Joe Biden maintained "about the only thing he did good." However, Trump told a Detroit audience in January he was open to Chinese cars being built in the U.S., marking a shift from his earlier position on China.
A deal incorporating Geely technology into Ford vehicles would represent the first partnership in the U.S. between Detroit and a Chinese automaker.