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Ford has held talks with electric vehicle maker Xiaomi over a partnership that would pave the way for Chinese carmakers to gain a foothold in the US, according to four people familiar with the talks.

While the discussions were preliminary, Ford has explored forming a joint venture with Xiaomi to manufacture EVs in the US, according to the people.

Ford has also spoken with BYD and other Chinese carmakers about potential collaboration in the US.

Such a deal would be controversial in Washington. John Moolenaar, the Republican chair of the House China committee, told the FT that Ford would “be turning its back on American and allied partners, and it will make our country further dependent on China”.

Ford said: “This story is completely false. There is no truth to it.”

Xiaomi said: “Reports that Xiaomi is discussing a joint venture with Ford Motor Co are false. Xiaomi does not sell its products and services in the United States and is not negotiating to do so.”

BYD declined to comment.

Ford chief executive Jim Farley is a vocal admirer of Chinese electric vehicles, having imported Xiaomi’s SU7 model for his own personal use. The Chinese group’s roots are in consumer electronics but it shocked the global automotive industry with a spectacular EV debut in 2024.

Farley warned last year that Chinese rivals pose an “existential threat” to western carmakers and had enough capacity in China alone to “put us all out of business”. He has previously said that Chinese companies are “absolutely coming” to the US.

Earlier this month, Farley hosted President Donald Trump at a Ford truck plant in Dearborn outside Detroit. During his visit, Trump told business leaders that if Chinese companies “want to come in and build a plant and hire you and hire your friends and your neighbours, that’s great, I love that”.

Ford has a licensing deal with China’s CATL to produce cells in the US using the battery giant’s technology. The Pentagon has designated CATL as a company with alleged Chinese military ties, which the group denies. The House China committee has also raised repeated concerns about the deal.

In 2024, the Biden administration in effect banned Chinese vehicles from the US by putting 100 per cent tariffs on car imports from China. Trump has kept those tariffs in addition to Biden-era restrictions on Chinese software and hardware for vehicles with a built-in internet connection.

Trump is preparing to visit China in April on a trip that could include a trade deal. Some experts believe the president wants to attract Chinese investment into the US, but his more hawkish officials would not welcome the prospect of allowing Chinese carmakers into the American market.

In 2021, during the final week of his first term, Trump added Xiaomi to a Pentagon list of companies with alleged ties to the Chinese military. The Biden administration removed it from the list later that year following a lawsuit from Xiaomi, which is headquartered in Beijing.

In December, the Republican chairs of several Congressional panels urged defence secretary Pete Hegseth to put Xiaomi back on the list.

Xiaomi has repeatedly denied any military connections. A company spokesperson told the FT: “Xiaomi also is not part of the Chinese government nor is it affiliated with any Chinese military entities.”

One former US official warned that allowing Ford to form a joint venture with Xiaomi would have a dangerous “domino effect” that would undermine US national security by driving other US carmakers into “a ‘forced marriage’ with Beijing as a matter of basic survival”.

Moolenaar said: “Joint ventures with Chinese companies frequently end poorly for American companies, and this new one would be a deal only Xi Jinping could love.”

BYD and other Chinese carmakers have made rapid inroads into Europe, south-east Asia and Latin America with affordable offerings of EVs and hybrids which are increasingly locally produced.

But Trump’s comments in Detroit and hints from another Chinese group, Geely, that it is preparing to enter the US market within the next three years have raised the spectre of Chinese manufacturers arriving in the US.

In a recent interview with Autoline Network, Ash Sutcliffe, head of global communications at Geely, which also owns Volvo Cars and Polestar, said: “The big question for us is when and where we will go to the USA.”

Sutcliffe declined to comment further to the FT but said the group continued to “monitor” potential opportunities in North America.

Ed Kim, president of consultancy AutoPacific, said Ford was particularly vulnerable to the entry of low-cost Chinese EVs into the US because it had already axed models in crucial mass-market segments in anticipation of an EV transition that has since stalled.

They include the compact crossover Ford Escape and the midsize Ford Edge SUVs, which have been discontinued. Ford has nothing to replace them with until at least 2027, when it plans to launch a new low-cost EV platform.