Ford Motor Co. CEO Jim Farley has quietly explored a controversial idea with members of the Trump administration: allowing Chinese automakers to build vehicles in the United States through joint ventures with American companies. The concept, according to a source familiar with the discussions, would aim to balance competitive realities with national economic interests at a time when Chinese electric vehicle makers are rapidly expanding abroad.

The proposal comes as U.S. automakers confront mounting pressure from China’s auto industry, which now produces roughly one-third of the world’s vehicles and has become especially dominant in electric vehicles. Although a 100% tariff on imported Chinese cars — first implemented under President Joe Biden and maintained by President Donald Trump — currently blocks direct entry into the U.S. market, many analysts believe it is only a matter of time before Chinese manufacturers find alternative pathways.

A Joint-Venture Model as a Strategic Buffer

Farley’s idea, reportedly discussed with U.S. Trade Representative Jamieson Greer, Transportation Secretary Sean Duffy and EPA Administrator Lee Zeldin during the Detroit Auto Show, would allow Chinese companies to establish U.S.-based production facilities in partnership with domestic automakers. Under such a structure, American firms would retain controlling stakes, while profits and technology would be shared.

The strategic logic mirrors models long used in China itself, where foreign automakers were historically required to partner with local firms. By reversing that framework, the U.S. could theoretically maintain oversight, protect intellectual property and ensure American job creation, while mitigating the shock of a direct Chinese market entry.

However, according to reports, the concept was met with skepticism in Washington. Concerns reportedly centered on national security, political backlash and the optics of cooperating with Chinese firms in a sector viewed as critical to economic sovereignty.

The Competitive Reality: China’s EV Surge

Farley has been outspoken about the competitive threat posed by Chinese automakers. He has described their vehicles as an “existential threat” to U.S. manufacturers, citing their speed of innovation, digital integration and cost efficiency. Chinese EVs already account for approximately 20% of new vehicle sales in Mexico, and Canada is expected to permit some Chinese EV imports in the near future.

Ford has intensified its study of Chinese competitors in recent years. Farley and his leadership team have reportedly traveled to Shanghai multiple times to analyze product design, software integration and customer experience strategies. Farley himself has driven a Xiaomi SU7, publicly praising its digital experience and build quality.

China’s domestic auto market is saturated, and with more than 100 brands competing aggressively on price, export expansion has become a necessity for growth. Companies such as Geely have openly signaled ambitions to enter the U.S. market within the next few years.

Policy Tensions and Market Implications

For policymakers, the debate reflects a broader tension between economic openness and strategic protectionism. Allowing Chinese firms to build plants in the U.S. could generate employment and consumer benefits, including lower-priced EVs and increased competition. Yet it also raises questions about data privacy, cybersecurity and long-term technological dependence.

Ford has reiterated its position that the U.S. market must be protected from a “flood of subsidized vehicles built in China,” while also acknowledging the inevitability of eventual competition. The joint-venture concept appears less an endorsement of Chinese entry and more an attempt to shape the terms under which it might occur.

Looking ahead, the trajectory of U.S.-China trade policy, North American EV adoption rates and domestic political dynamics will determine whether such partnerships become politically viable. For now, tariffs remain the primary barrier — but strategic discussions suggest that industry leaders are preparing for a future in which those walls may not be permanent.