Ford Explores Potential Partnership with China's Xiaomi, Eyeing U.S. Manufacturing Footprint
In a move that could reshape competitive dynamics in the electric vehicle sector, Ford Motor Co. has engaged in exploratory talks with China's Xiaomi, the consumer electronics giant that recently entered the automotive arena, the Financial Times reported. Sources indicate the discussions, though at an early stage, center on forming a joint venture to establish a manufacturing presence for Xiaomi in the United States.
The FT, citing four individuals briefed on the meetings, noted that Ford has also held similar preliminary discussions with other Chinese manufacturers, including industry leader BYD. This aligns with Ford CEO Jim Farley's publicly stated view that Chinese automakers are formidable competitors in EV technology and cost efficiency. Farley has previously admitted to spending months test-driving a Xiaomi SU7 to study its capabilities firsthand.
However, Ford has publicly disputed the report. A company spokesperson told Car and Driver that the FT's account is "incorrect," stating the cited sources are wrong. Xiaomi did not immediately respond to requests for comment.
Industry analysts suggest a potential partnership could take multiple forms: a collaborative effort to co-develop next-generation electric vehicle platforms and smart cockpit technologies, or a more integrated manufacturing agreement where Ford provides U.S. assembly capacity for Xiaomi-designed vehicles. Such a move would help Xiaomi navigate complex trade policies and supply chain logistics while giving Ford access to Xiaomi's rapid software innovation and consumer electronics integration expertise.
Market Reaction & Expert Commentary:
"If true, this is a pragmatic, if not startling, pivot," said Michael Ridgeway, an automotive analyst at Bernstein Research. "Ford recognizes the R&D velocity in China. A tie-up could be less about outsourcing and more about insourcing that speed to market, particularly in software-defined vehicles."
Sarah Chen, a portfolio manager focused on industrial equities, offered a more measured view: "We've seen this dance before—exploratory talks that lead nowhere. The regulatory hurdles, both in the U.S. and China, are significant. This is likely a strategic probe by Ford to gauge capabilities and pressure other potential partners."
The report sparked sharper reactions from industry veterans. Frank O'Reilly, a former manufacturing executive and outspoken commentator, did not mince words: "This is a capitulation masquerading as strategy. After decades of building American industrial capacity, are we now preparing to hand the keys to Chinese firms? Farley driving a Xiaomi is a telling PR stunt, but basing a partnership on it is dangerously naive regarding long-term IP and competitive risks."
Meanwhile, Priya Sharma, a tech transfer specialist at Georgetown University, noted the broader trend: "This isn't isolated. We're entering an era of 'co-opetition' in autos. The lines between tech and auto, and between geopolitical blocs, are blurring. Partnerships like this, if they materialize, will be intensely complex but could define the next phase of the EV transition."
The discussions, denied by Ford but reported by multiple sources, highlight the intense pressure legacy automakers face to accelerate their EV transition and software capabilities, even if it means partnering with the very competitors disrupting their market.