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Time of India
2 days ago
- Automotive
- Time of India
Export controls are endangering the fragile U.S.-China truce
BEIJING: After stepping back this month from an escalating and dangerous war of tariffs, the United States and China are now threatening to undermine their uneasy truce. On May 12, the countries announced after weekend meetings in Geneva that they would suspend most of their recently imposed tariffs. Since then, however, both governments have shown that they are still prepared to wield controls over critical exports as weapons against one another, with moves that are potentially even more damaging to trade and global supply chains. China has restricted its exports of rare earth magnets, which are crucial for cars, semiconductors, aircraft and many other applications. Close to 90% of the world's rare earth metals, including magnets, are produced in China. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo And the United States on May 13 banned the latest semiconductors from Huawei, a Chinese electronics giant. Then on Wednesday, President Donald Trump suspended the shipment of American semiconductors and some aerospace equipment needed for China's commercial aircraft, the C919, a signature project in China's push toward economic self-reliance. The increasing use of export controls by both countries amounts to supply chain warfare, interrupting the flow of key components that the other country must have to operate huge industries that employ large numbers of workers. Live Events Last week, Ford Motor temporarily closed a factory in Chicago that makes Ford Explorer sport utility vehicles after one of its suppliers ran out of the magnets. In most new cars, the magnets are used in dozens of electric motors that operate brake and steering systems, fuel injectors and even power seats. On Monday, China granted some export licenses for rare earth magnets to be shipped to the United States and Europe, according to two industry executives who spoke on the condition of anonymity to discuss a sensitive matter. But many more factories in both regions will have to close in the coming days and weeks if China does not resume full exports of rare earth metals, corporate executives and business leaders said. "Hundreds of EU companies are impacted, and we expect that this may lead to production stoppages already this week for some companies," said Jens Eskelund, the president of the European Union Chamber of Commerce in China. American companies are feeling the effect even more. Several companies in Europe, including Volkswagen, were granted permission by Beijing to continue procuring rare earth magnets soon after China began enforcing export controls on them in April. American companies have been juggling factory schedules, reassigning their dwindling magnet supplies to continue making their most profitable products. A Ford spokesperson confirmed that the Explorer factory had been closed last week because of a disruption in rare earth magnet supplies, but said that it had reopened this week. Ford had been planning to not run the factory for a week anyway in the coming months, and shifted that down time to last week when the magnet supply ran short, he said. The agreement reached in Geneva by U.S. and Chinese officials to de-escalate their confrontation over tariffs has been cheered by investors. The two sides said they would take a 90-day pause on tariffs and set up working groups of top officials to try to reach agreements on trade. That made the timing of the U.S. Commerce Department's decision a day later to ban Americans from using or financing Huawei artificial intelligence chips noteworthy. The department contended that the AI chips were based on a prohibited export of U.S. technology, which Huawei has denied. The restrictions were the latest in a long series of American blows aimed at Huawei, which is one of China's best-known success stories. Its hundreds of thousands of workers produce everything from cellphone base stations to autonomous driving systems for cars. Chinese officials have reacted with growing anger at the U.S. use of export controls. "China once again urges the U.S. to immediately correct its wrong practices, stop discriminatory restrictive measures against China, and jointly maintain the consensus reached at the Geneva high-level talks," He Yongqian, the Ministry of Commerce spokesperson, said at a news briefing Thursday. American restrictions on sales to COMAC, a state-owned enterprise, represent a setback to the Chinese government's long-term project to shed its dependence on Boeing and Airbus. The C919 aircraft is heavily dependent on American and European components, with the company's miles-long complex of hangars and design labs in Shanghai mainly installing components from foreign companies in Chinese-built air frames. COMAC did not respond to a phone call and fax for comment. In a reply to questions early Thursday, Kush Desai, a White House spokesperson, said, "The Geneva agreement was a major first step towards securing a final, comprehensive trade deal with China. Discussions continue, and the administration is monitoring compliance with the agreement." The United States has been gradually tightening export controls on semiconductors for a decade, contending that China has used American computer chip technology to improve a wide range of military hardware. Chinese government officials and industry executives have denied this, and contend that the United States is trying instead to limit China's economic development. Two days after Trump imposed steep tariffs on April 2 on imports from China and many other countries, China imposed its own export controls on some kinds of rare earths and heat-resistant magnets made from them. The Geneva trade agreement had also called for China to "adopt all necessary administrative measures to suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025." But China's Commerce Ministry has contended that rare earths have military applications, and it has avoided describing its export controls as a trade countermeasure. Although most rare earth magnets are used in civilian industries, they are also essential for electric motors in advanced fighter jets and the guidance systems of intercontinental ballistic missiles. "It is a common international practice to impose export controls on items with obvious dual-use military and civilian attributes," He said Thursday. Experts in China have begun defending export controls on rare earth magnets as appropriate while the United States maintains export controls on semiconductors. "China sees export controls on rare earths as a counterstrike to U.S. export controls on semiconductors," said Zhu Ning, deputy dean at the Shanghai Advanced Institute of Finance. Yet if China maintains export controls on rare earths, many multinational companies may conclude that their supply chains are too reliant on China, Eskelund said. "The risk of production stoppages due to export controls will only increase calls in Europe for de-risking from China." The question now is how much longer both sides maintain their export controls. "It would be unfortunate if one or both sides overestimates its own leverage and feels like it needs to prove that to the other side," said Chris Adams, a former Treasury official who is now a partner at the Covington and Burling law firm.
Yahoo
2 days ago
- Automotive
- Yahoo
Bill Ford says loss of federal funding could 'imperil' Marshall battery factory
Ford Motor Co. Executive Chair Bill Ford, speaking at the Mackinac Policy Conference, sounded the alarm on the potential for Washington to do away with production tax credits that support the manufacturing of electric vehicle batteries. The disappearance of the credits would threaten Ford Motor's investment in a Marshall plant. "If it doesn't stay, it will imperil what we do in Marshall," Ford said on May 29. 'We made a certain investment based upon a policy that was in place. It's not fair to change policies after all the expenditure has been made,' he said. The tax bill passed by the U.S. House of Representatives this month could bar lucrative tax credits for batteries produced using Chinese technology. Ford's factory, now under construction, would make battery cells using tech from Chinese battery giant CATL. The Senate still must deal with the bill, which Democrats oppose and has drawn criticism from some fiscally conservative senators. Ford received a reduced incentive package from Michigan last year for the battery plant after it cut expected production there to match slowing demand for electric vehicles. Since the automaker announced the plant in 2023, it has drawn scrutiny from some lawmakers for its ties to the Chinese company. More: Ford, Michigan cut $750M in planned public support for Marshall site, other EV projects This article originally appeared on Detroit Free Press: Bill Ford: Loss of tax credits could 'imperil' Marshall battery plant
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Business Standard
3 days ago
- Business
- Business Standard
Export controls are endangering the fragile US-China truce
After stepping back this month from an escalating and dangerous war of tariffs, the United States and China are now threatening to undermine their uneasy truce. On May 12, the countries announced after weekend meetings in Geneva that they would suspend most of their recently imposed tariffs. Since then, however, both governments have shown that they are still prepared to wield controls over critical exports as weapons against one another, with moves that are potentially even more damaging to trade and global supply chains. China has restricted its exports of rare earth magnets, which are crucial for cars, semiconductors, aircraft and many other applications. Close to 90 percent of the world's rare earth metals, including magnets, are produced in China. And the United States on May 13 banned the latest semiconductors from Huawei, a Chinese electronics giant. Then on Wednesday, President Trump suspended the shipment of American semiconductors and some aerospace equipment needed for China's commercial aircraft, the C919, a signature project in China's push toward economic self-reliance. The increasing use of export controls by both countries amounts to supply chain warfare, interrupting the flow of key components that the other country must have to operate huge industries that employ large numbers of workers. Last week, Ford Motor temporarily closed a factory in Chicago that makes Ford Explorer sport utility vehicles after one of its suppliers ran out of the magnets. In most new cars, the magnets are used in dozens of electric motors that operate brake and steering systems, fuel injectors and even power seats. On Monday, China granted some export licenses for rare earth magnets to be shipped to the United States and Europe, according to two industry executives who spoke on the condition of anonymity to discuss a sensitive matter. But many more factories in both regions will have to close in the coming days and weeks if China does not resume full exports of rare earth metals, corporate executives and business leaders said. 'Hundreds of EU companies are impacted, and we expect that this may lead to production stoppages already this week for some companies,' said Jens Eskelund, the president of the European Union Chamber of Commerce in China. American companies are feeling the effect even more. Several companies in Europe, including Volkswagen, were granted permission by Beijing to continue procuring rare earth magnets soon after China began enforcing export controls on them in April. American companies have been juggling factory schedules, reassigning their dwindling magnet supplies to continue making their most profitable products. A Ford spokesman confirmed that the Explorer factory had been closed last week because of a disruption in rare earth magnet supplies, but said that it had reopened this week. Ford had been planning to not run the factory for a week anyway in the coming months, and shifted that down time to last week when the magnet supply ran short, he said. The agreement reached in Geneva by US and Chinese officials to de-escalate their confrontation over tariffs has been cheered by investors. The two sides said they would take a 90-day pause on tariffs and set up working groups of top officials to try to reach agreements on trade. That made the timing of the US Commerce Department's decision a day later to ban Americans from using or financing Huawei artificial intelligence chips noteworthy. The department contended that the A.I. chips were based on a prohibited export of American technology, which Huawei has denied. The restrictions were the latest in a long series of American blows aimed at Huawei, which is one of China's best-known success stories. Its hundreds of thousands of workers produce everything from cellphone base stations to autonomous driving systems for cars. Chinese officials have reacted with growing anger at the US use of export controls. 'China once again urges the US to immediately correct its wrong practices, stop discriminatory restrictive measures against China, and jointly maintain the consensus reached at the Geneva high-level talks,' He Yongqian, the Ministry of Commerce spokeswoman, said at a news briefing on Thursday. American restrictions on sales to COMAC, a state-owned enterprise, represent a setback to the Chinese government's long-term project to shed its dependence on Boeing and Airbus. The C919 aircraft is heavily dependent on American and European components, with the company's miles-long complex of hangars and design labs in Shanghai mainly installing components from foreign companies in Chinese-built air frames. COMAC did not respond to a phone call and fax for comment. In a reply to questions early Thursday, Kush Desai, a White House spokesman said: 'The Geneva agreement was a major first step towards securing a final, comprehensive trade deal with China. Discussions continue, and the administration is monitoring compliance with the agreement.' The United States has been gradually tightening export controls on semiconductors for a decade, contending that China has used American computer chip technology to improve a wide range of military hardware. Chinese government officials and industry executives have denied this, and contend that the United States is trying instead to limit China's economic development. Two days after Trump imposed steep tariffs on April 2 on imports from China and many other countries, China imposed its own export controls on some kinds of rare earths and heat-resistant magnets made from them. The Geneva trade agreement had also called for China to 'adopt all necessary administrative measures to suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025.' But China's Commerce Ministry has contended that rare earths have military applications, and it has avoided describing its export controls as a trade countermeasure. Although most rare earth magnets are used in civilian industries, they are also essential for electric motors in advanced fighter jets and the guidance systems of intercontinental ballistic missiles. Experts in China have begun defending export controls on rare earth magnets as appropriate while the United States maintains export controls on semiconductors. 'China sees export controls on rare earths as a counterstrike to US export controls on semiconductors,' said Zhu Ning, deputy dean at the Shanghai Advanced Institute of Finance. Yet if China maintains export controls on rare earths, many multinational companies may conclude that their supply chains are too reliant on China, Eskelund said. 'The risk of production stoppages due to export controls will only increase calls in Europe for de-risking from China.' The question now is how much longer both sides maintain their export controls. 'It would be unfortunate if one or both sides overestimates its own leverage and feels like it needs to prove that to the other side,' said Chris Adams, a former Treasury official who is now a partner at the Covington and Burling law firm.
Yahoo
4 days ago
- Automotive
- Yahoo
Ford issues recall of more than 1 million vehicles
DEARBORN, Mich. (WSAV) — Ford Motor company is recalling over 1 million vehicles due to a software error effecting the rearview camera. According to the National Highway Traffic Safety Administration (NHTSA), the issue could cause the rearview camera image to delay, freeze or not display, reducing drivers' views behind the vehicle and increasing the risk of a crash. The recall affects a variety of vehicles made between 2021 and 2024, including Ford Broncos, F-150s, Mustangs and Lincoln Navigators. The NHTSA said dealers are expecte4d to update the accessory protocol interface module (APIM) software through an over-the-air update, free of charge. Letters notifying owners of the safety risk are expected to be mailed by June 16 followed by a second letter once the remedy is available. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
CBS News
4 days ago
- Automotive
- CBS News
Ford recalls more than 1 million vehicles over rearview camera glitch
Ford Motor is recalling nearly 1.1 million Ford and Lincoln vehicles because of a software problem that could cause the rearview camera image to malfunction when the car is in reverse, the National Highway Traffic Safety Administration said. "A frozen rear-view camera display image while in reverse can create a false representation of where the vehicle is relative to its surroundings, increasing the risk of a crash," the NHTSA stated in a May 9 report. Ford is not aware of any injuries related to the software error. The automaker has received one report of a minor crash resulting in property damage. The recall affects 1,075,299 vehicles, including the following Ford and Lincoln models: Ford: 2021-2024 Bronco, F-150, 2021-2024 Edge 2022-2024 Expedition 2022-2025 Transit, 2021-2023 Mach-E 2023-2024 Escape, F-250, F-350, F-450, F-550, F-600 2024 Ranger, Mustang Lincoln: 2021-2023 Nautilus 2022-2024 Navigator 2023-2024 Corsair To fix the problem, a vehicle's so-called accessory protocol interface module (APIM) software will eventually be available to be updated for free either in person at a Ford/Lincoln dealership, or remotely through an over-the-air update, according to Ford. Notification letters are expected to be mailed to owners of affected vehicles on June 16 to alert them of the rearview camera problem. A second letter will be sent once the remedy is available sometime between July and September, recall documents state. Affected vehicle owners can contact Ford customer service at 1-866-436-7332; Ford's number for this recall is 25S49. Owners can also contact NHTSA's vehicle safety hotline at 888-327-4236 (TTY 888-275-9171) or go to NHTSA's number for the recall is 25V-315. The camera issue is the latest of several recalls this year by the Detroit automaker. Most recently, Ford recalled roughly 274,000 Lincoln Navigator and Ford Expedition vehicles because of a poorly installed front brake line that could lead to reduced brake function, NHTSA said in another recall dated May 9. In November 2024, NHTSA fined Ford $165 million for moving too slowly to recall vehicles with faulty rearview cameras and for failing to give the agency complete information as required by the Federal Motor Vehicle Safety Act.
