The United States and Mexico will work to integrate their supply chains and expand electric vehicle production via Mexico’s nationalized lithium industry, the two countries said this week.

A U.S. delegation asked Mexico to participate in an effort to shift semiconductor production from Asia to North America and increase electric-vehicle production, taking advantage of the Biden administration’s investment in semiconductor production.

The efforts, discussed at the countries’ High-Level Economic Dialogue in Mexico City, are intended to erode Asia’s upper hand in semiconductors and batteries for EVs and to promote North American production.

“Major elements of the semiconductor supply chains are already well established in Mexico, with U.S. based companies like Intel and Skyworks conducting research and development, design, assembly and test manufacturing in parts of Mexico,” U.S. Secretary Antony Blinken said.

Mexico President Andrés López Obrador said his plan is for the northern border state of Sonora to be a leader in lithium, electric vehicle and solar energy production, Mexico Foreign Affairs Secretary Marcelo Ebrard said. Lithium is a key battery component for EVs.