# U.S.-China Investments Can Still Work for Americans

> U.S. and China can build electric vehicle partnerships that benefit both nations through deep-tech learning, not tech transfers.
- Title: U.S.-China Investments Can Still Work for Americans | Shortify
- Summary: U.S. and China can build electric vehicle partnerships that benefit both nations through deep-tech learning, not tech transfers.
- Keywords: u.s., china, electric vehicles, battery technology, electrical and electronic architecture, powertrain technologies, deep-tech iterative learning, board of investment, board of trade, automakers, chinese automakers, u.s. automakers
- Source: Foreign Policy — https://foreignpolicy.com/2026/11/12/china-us-investments-auto-electric-vehicles
- Author: Lizzi C. Lee, Fengming Lu
- Read time: 3 min
- Topics: u.s., china, electric vehicles, battery technology, electrical and electronic architecture, powertrain technologies, deep-tech iterative learning, board of investment, board of trade, automakers, chinese automakers, u.s. automakers
## U.S.-China Investment Mechanisms
The Board of Trade and Board of Investment were meant to turn the 2025 Busan summit between U.S. President Donald Trump and Chinese President Xi Jinping into concrete economic deliverables.
## Current Investment Challenges
So far, only the Board of Trade has developed an agenda, reflecting how difficult cross-border investment has become amid U.S.-China strategic rivalry.
## Potential Investment Paths
The Board of Investment could take the easy route of approving small, nonsensitive deals or aim higher for investments that deliver meaningful gains for both countries.
## Electric Vehicle Sector Challenges
China faces weak demand and fierce competition in its electric-vehicle sector at home, while the United States needs more affordable green autos and stronger domestic capabilities in next-generation automotive technologies.
## Misconceptions About EVs
The popular proposal is that the United States can ask China to transfer its battery technology, but battery tech is the wrong focus, tech transfer is the wrong approach, and U.S.EVs are the wrong target.
## Why Batteries Alone Won't Work
Access to China’s cheaper lithium-ion battery technology would not be enough to make EVs affordable in the United States, as Japan and South Korea once led in lithium-ion batteries but did not translate into EV…
## Electrical and Electronic Architecture
Chinese automakers advanced quickly in electrical and electronic architecture (EEA), the brain and nervous system of intelligent electric vehicles, which uses a centralized architecture with few computers coordinating the whole vehicle.
## EEA Benefits
Zonal EEA shortens development cycles, simplifies supply chains, lowers costs, integrates intelligent features, and enables a smartphone-like user experience.
## Tesla and Chinese Catch-Up
Tesla pioneered zonal EEA in 2017, but fierce competition pushed Chinese automakers to catch up quickly.
## China's Powertrain Leadership
China now leads across a broad range of powertrains, including battery-electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), and many others.
## U.S. Driving Patterns
Americans drive roughly twice as many miles each year as Europeans and 70 percent more per passenger car than Chinese, making extended BEV range challenging.
## PHEVs as Better Option
China-developed affordable PHEVs can travel about 100 miles on electricity, enough for most daily commutes, while achieving fuel economy of roughly 60 miles per gallon on longer trips.
## Home Charging for PHEVs
Many suburban homeowners can install home chargers that are more than adequate for the smaller batteries in PHEVs and for routine commuting.
## Technology Transfer Challenges
Technology transfer is sensitive, as China is not willing to give away the crown jewels of its technology so easily, and making U.S. auto competitive requires advanced EEA and powertrain technologies.
## Deep-Tech Iterative Learning
China’s own experience shows why local manufacturing is insufficient for deep-tech iterative learning, requiring step-by-step processes for reciprocal technology exchange.
## Volkswagen Partnership
Volkswagen improved Chinese capabilities in manufacturing, supply-chain management, and quality control but did relatively little to build domestic R&D.
## GM and Ford Partnership
A second wave of partnerships with General Motors (GM) and Ford created a more disciplined, step-by-step process for iterative learning in automotive R&D.
## Reciprocal Learning Outcomes
Over time, China acquired technology and engineering expertise, helping U.S. automakers improve vehicle quality and reliability while reducing R&D costs after the 2008 financial crisis.
## Leverage for Iterative Learning
Bargaining power for iterative technological gains comes from leverage, incentives that make technology transfer worthwhile for the provider, and the architecture to make it work.
## Shanghai's Bidding Process
In the early 1990s, officials in Shanghai negotiated with more than 10 international automakers and invited GM, Ford, and Toyota into the final bidding process.
## Key takeaway

U.S.-China investments in electric vehicles can work for Americans by focusing on deep-tech iterative learning rather than battery tech transfers.