Global companies are increasing their reliance on Chinese technology even as Washington continues to tighten restrictions on the sector. Apple Inc. is utilising Alibaba and Baidu for artificial intelligence in China, while Ford Motor Company is using CATL's electric vehicle battery technology.

China has transitioned from a market for Western goods into a vital source of technology that many companies find difficult to avoid. This shift raises questions regarding whether such dependence is a temporary measure or a structural change that is difficult to reverse.

Apple's AI Partnerships in China

Working with Alibaba and Baidu is not considered optional for Apple Inc. because foreign AI providers face restrictions within China. According to Kitty Fok of IDC China, these partnerships represent the only realistic way for Apple to compete in the Chinese smartphone market. An IDC survey of European companies indicated that security, compliance, and performance are the primary drivers for extensive Chinese AI adoption, rather than cost.

Apple has maintained this relationship for over a year. Alibaba chairman Joe Tsai stated in February 2025 that Apple evaluated several Chinese AI partners before selecting Alibaba, noting in Dubai:

The relationship has intensified throughout 2026. Apple received Chinese regulatory approval for Apple Intelligence in July and has recently been training a China-specific AI model with support from Alibaba. However, this dependence highlights Apple's limited influence within the Chinese regulatory system. The company's public execution has also seen inconsistencies, such as the brief publication and subsequent unexplained deletion of a guide regarding connecting Macs to Alibaba's Qwen assistant. Additionally, US restrictions on Chinese technology, beginning with the blacklisting of Huawei in 2019, have introduced geopolitical risks to these operations.

Ford's Battery and Manufacturing Ties

Ford Motor Company is employing CATL's lithium-iron phosphate battery technology at a $3.5 billion plant in Michigan. Analysts suggest that CATL has achieved a structural shift in the electric vehicle (EV) battery sector that is too deep to unwind quickly. The scale of Chinese dominance in this sector is significant:

• Automakers including CATL, BYD, CALB, and Gotion control nearly 70% of global EV battery production.
• BYD, Changan, and Chery accounted for nearly 63% of the global EV market in 2025, according to Counterpoint Research.

Ford’s connection to Chinese manufacturing predates its relationship with CATL; the current Lincoln Nautilus has been produced for years at a Changan Ford plant in Hangzhou and exported to the US.

Switching battery suppliers is a process that analysts say requires years of engineering, testing, and recertification, making Ford's reliance on CATL difficult to reverse if trade tensions increase. The company's manufacturing links in China have also created financial liabilities. The China-built Nautilus is subject to a 52.5% US tariff, a cost Ford intends to avoid by shifting production to the United States starting in 2030. Consequently, Ford is exiting one Chinese dependency while deepening another.

Investment and Strategic Trends

As of Q1 2026, Apple Inc. was held by 170 hedge funds, an increase from 169. During the same period, Ford Motor Company was held by 50 hedge funds, down from 52.

Both Apple and Ford are proceeding on the assumption that the operational advantages of partnering with Chinese technology providers outweigh the long-term risks of becoming increasingly difficult to separate from them.