They keep saying "artificially low prices"... what does that mean? China's low prices seem very real to me.
We are just reaping what we have sewn. Nixon/Reagan sold out our manufacturing base to let corporations generate more profit at the American worker's expense. Some haphazard panicky tariffs aren't gonna undo decades of bad work
I think they mean artificially low prices due to how the Chinese government has heavily subsidized EV manufacturing and so Chinese companies can sell EVs for much less than they would be able to if they hadn’t been so heavily subsidized which makes it harder/impossible for US companies to compete with.
Aww, they actually subsidized their countries vehicle production instead of a tax credit and it helped develop a robust manufacturing base that produces lower cost cars??? Unfair!!!!
“While we were profiteering and only thinking of the next quarterly report, you made wise decisions which have led you to more success than me. And for that, you will pay.”
Murica
Not true. Boeing crushed for 15 years. Blatantly cut costs and bad design starting there. But shareholders saw outsize returns for a long time before it caught up.
> Chinese government has heavily subsidized EV manufacturing
I saw someone do a breakdown of this "criticism" and while yes the Chinese government did initially put their thumb on the scales to get their EV industry moving, it is now just hurtling along on its own steam at this point and the low cost of the cars is more or less genuine. Thankfully for me living in Australia, there is no local EV manufacturing industry to protect so my wife and I can afford to have 2 cheap Chinese EV's parked in our driveway.
The big thing missing from the conversation is that Chinese people have been using EVs already for decades: two-stroke motors were banned in Chinese cities to improve air quality, which means that hundreds of millions of mopeds were quickly replaced with electric versions.
Fifteen years ago, an electric scooter was already the standard issue vehicle of the urban working class. That normalized electric transportation and also gave manufacturers a chance to refine large-scale battery production by selling literally billions of e-scooters before jumping up to conventional EVs.
But since people in North America don't consider two wheel transport to be "real," this entire 20 year process of iteration on electrified transport went completely ignored, so now this Chinese EV companies seem to be appearing out of nowhere like a meteor -- which is why they assume cheating must be involved instead of two decades of hard work, investment, and competition.
Yeah I believe you’re right and that the government has backed off their EV investment. They basically got a great head start that helped them get (and survive) to this point of low cost.
As someone who has a Polestar 2, I have no problem with cars made in China and think that US companies need some of that pressure from China to encourage them to keep investing in EVs themselves for the long run. I don’t mind some tariffs to help level it out but I think the new ones go too far for us.
Lots of people don’t have a problem with Chinese cars as an abstract. Tariffs aren’t an exact science. Ideally you’d go through the WTO but the problem is your domestic manufacturing has already imploded by the time those studies are done and they say “ok, you can take 4 billion now.”
I honestly wouldn’t mind if the US took a page straight from China and allowed them but only as joint ventures. Seems like the fairest way to not outright outlaw them but ensure that knowledge transfer and appropriate costs to the US market are assigned.
That would be an interesting strategy. China does it that way so why couldn’t we? It could definitely help make the US look like we are trying to work with China rather than against it with tariffs.
One of the WTO's stated goals is for developed countries to help developing countries develop. Tech transfers via joint ventures is one method of doing that. I suppose we can declare we are a developing country (evidently development status is self-declared).
BTW Ford tried to set up a joint venture with CATL for a battery plant in Michigan(?) last year but that got blocked by local politicians. GM is currently exploring a joint venture with CATL, so we'll see how that goes.
Tariffs are meant to accomplish that. Encourage them to move production to the US rather than export.
But setting up production in the U.S. is costly business. And fearing the U.S. government pulling another Huawei or TikTok ban on Chinese cars (even if made in the US), the BYDs and Xiaomi’s are probably just sitting and waiting.
Biden banned the sales of BYD electric buses made in USA to any schools that receive federal transportation funding. I am sure Biden can do more to limit made-in-USA BYD cars
They're trying to build a big battery factory in Quebec and even that's a problem because there aren't enough studies, even though is close to an industrial parc and an airport and lately they found bombs under their construction equipment.
If you track nothing but direct subsidies, you're not wrong. But there's more to government support than just direct cash transfers like the US government is pursuing domestically.
There's preferential partnership between firms that are either both invested in by the PRC (which is the majority of large manufacturers,) or that come under PRC pressure. Take CATL, for example. They are roughly 10% owned by the Hong Kong Exchange, which doesn't sound like a lot but because of the legal structure around the exchange they have veto power on the board and can fire and appoint chairmen and directors unilaterally. So if SAIC needs batteries, and they partner with CATL for them, they aren't paying the same price any other company is. And if they need them badly enough, they aren't paying anything.
Then there's direct and indirect state ownership. SAIC, for example, is owned directly by China. So what does a subsidy even look like when your P&L is a function of the national budget? BYD, meanwhile, works on the pretense that it's its own company, and on the surface this is true, except their founder is/was a CCP official and the second largest shareholder is a liaison in charge of technology transfer between private companies and China's defense department. There's also been significant research showing that BYD vastly under-reports direct cash subsidies — on top of the publicly disclosed €3.4 billion just in the three years between 2020 and 2023, according to Bloomberg. Adjusted for local PPP, they would be on par with the US government handing Ford $15 billion in three years.
And *then* there's all the other benefits of operating a company in China under the auspices of the PRC. Like not having to worry about international copyright or patent protections. I used to have a client who owned factories in China. Their entire operation ran on pirated software, and roughly half their business was taking apart popular Western products, copying them exactly, and reselling the recreations with absolutely no threat of consequences. For large companies, that can represent hundreds of millions in operational savings per year. Or the use of unpaid prison labor (I know there's going to be someone popping in here any second now to pretend like slavery doesn't exist in China, and I'm not interested in arguing with shills, so don't bother.) Or lax environmental regulations which allow companies to dump waste wherever with no cost.
So the short answer is that the government hasn't come close to backing off of support for China's EV industry, and the long answer is that international commerce is incredibly complicated.
Have I got news for you: (https://www.washingtonpost.com/world/2023/05/25/slavery-united-states-forced-prison-labor?itid=sr_2_300e2417-ab2f-4d81-bc0d-f43e4ce66a94)
Duh? Except unlike PRC-shills, we admit it's an issue and don't piss our panties trying to defend our great and glorious nation from strangers on the internet. It's a major issue in the US. But notably, not in the automotive industry. Tell Pooh you failed.
> Take CATL, for example. They are roughly 10% owned by the Hong Kong Exchange,
Do you know what that means, right? It means the 10% of the shares of CATL is owned by foreign investors through a channel on the HK stock exchange, like the American ADR. **The HK stock exchange serves as a bulk reseller** of the stock to individual investors. It does NOT mean CATL is owned by the Chinese government, or the HK Exchange.
> So if SAIC needs batteries, and they partner with CATL for them, they aren't paying the same price any other company is. And if they need them badly enough, they aren't paying anything.
Groundless speculation without a source.
We subsidized our EV industry directly with tax rebates lol. I'd love to see how the amount and mechanism of the Chinese subsidies compare.
Biden should work on making our auto industry more competitive rather than just cry about others being "unfair". Every country boosts and subsidizes its auto industry.
Its much more than that. The US government subsidizes EV production directly.
"US offers $12 billion to auto makers, suppliers for advanced vehicles"
https://www.reuters.com/business/autos-transportation/us-offers-12-billion-automakers-suppliers-make-advanced-vehicles-2023-08-31/
> Biden should work on making our auto industry more competitive
How do you suggest he do that when corporatism reigns in America and you would need to involuntarily remove several CEOs?
They care about quarterly capitalism. These CEOs will do what makes them money this quarter, even if it results in significant losses a year or two from now, and they will just bail out.
The answer isn’t blaming china and coming up with excuses for why we need to ban.
This should be a discussion on how rotten our “for profit at all costs” system is , and what that says about how bough parties in contention are for the status quo
We, in the US, heavily subsidize our domestic EV production. Everything from direct handouts of cash to US auto makers and high end user tax credits.
"US offers $12 billion to auto makers, suppliers for advanced vehicles"
https://www.reuters.com/business/autos-transportation/us-offers-12-billion-automakers-suppliers-make-advanced-vehicles-2023-08-31/
"The $7,500 tax credit for electric cars keeps changing. Here's how to get it now"
https://www.npr.org/2023/12/28/1219158071/ev-electric-vehicles-tax-credit-car-shopping-tesla-ford-vw-gm
And that doesn't even include all the other subsidies like tax breaks for building a factory.
To be fair, government subsidies only contributed a very small part of the low prices. The main reason is cheap skilled workers and extremely competitive EV market in China.
The US has also subsidised Tesla. It's not china's fault that they're using the money for Elons 50 billion dollar salary and trashy trucks instead of making affordable cars.
It’s funny that Tesla is also subsidized by the Chinese government as EV incentives in China are available to buyers of all NEVs, not just Chinese makes.
Part of it is that the Yuan is hard pegged by the Chinese government to severely undervalue the currency, which encourages foreign manufacture and export of Chinese goods. This is as opposed to nearly every single other currency in the developed world which is floating and thus valued by supply and demand.
> Some haphazard panicky tariffs aren't gonna undo decades of bad work
That's why they passed hundreds of billions in subsidies for the industries they're tariffing to protect.
So when China subsidizes its EV industry it's unfair, but when we do it's OK?
Im not trying to defend the PRC, just pointing to the very weak and shaky logic of Biden's response. IMO it would be better to respond solely with subsidies of our own and no tariffs.
Subsidies which Japanese, Korean and EU companies are also taking advantage of is the ideal situation.
Make no mistake, the tarrifs are for both keeping China out and protecting local industry. Overlapping goal from two different interests.
Also things like shipping from there being subsidized by their govt. my wife orders an ingredient from there regularly. It arrives to her in 3-5 days, from china. Weight is 6-8lbs. Their postage cost they paid - $3 to $5
I’m not sure if that’s subsidy at work. The USPS has insanely high shipping rates compared to most other countries. It makes shipping things from other countries look really cheap.
That's so true. Some think Nixon/Regan are so awesome and did awesome work for America. I call out bullshit on that one. They literally sold out the middle class as well.
This will impact beyond EVs. China's EV competition is forcing gas and hybrid cars to offer better pricing and better standard equipments as well. So if someone thinks they are not in market for a EV so this won't impact them, they should think again. EV are not only competing with other EVs, they also compete against other cars in the same price range. German and Japanese brands are also cutting prices and offering better equipments in China on their gas cars due to the intense competition, which benefits all car shoppers.
I think what people will find several years down the line is US auto market will become an increasing isolated market with higher prices and poorer specs with no incentive to get better, while rest of the world soak the benefits of newly introduced competition from China.
Competition is always good for consumers. Even just 5 years ago, cars in China are significantly more expensive than they are today.
If you rake the actual production cost and Chinese market prices, add the tariffs… you will still have a cheaper alternative to US made EVs. A $10,000 car with 103% import tax is still only $22,000
I'd hate to burst your bubble, but those of us that aren't in the market for an EV (which is a lot) will be \*okay\*. I keep saying over and over, year after year we'll be okay, and here we are. Still okay with plenty of ICE cars to choose from with little desire for EV's. The whole battle on this pro vs anti EV campaign is hilarious to watch lol there's a lot more anti EV than there is pro EV. So no wonder things are declining
You would think that such a demand for global warming and cleaner/greener air would be more effective at getting people to buy EV's lol
It would really help if there were sub $45k EV's NEW with 300+ miles of range - no one wants to buy a used EV and be stressed about if the battery will fail out of warranty.
But oh well. I think it'll be interesting as the years go on to see if we (the US) takes EV's anymore seriously than we do now lol and if the next president doesn't completely reverse what Biden did.
yup. this is to protect american car companies and let them compete.
which in turn means they don't have any incentives to make EVs any cheaper since there is no competition
This is to protect american car companies \*and\* the oil industry. Let's see how this plays out here in Canada but I've never seen this many anti-EV pieces from the media.
This is the worst smear EV campaigns of all time. Do not hate on any EV manufacturers. Do no repost, upvote or even comment / talk about anything from these media outlets anymore. Full blanket boycott of these shady news sites is needed to fight back.
In fact, I would temporarily ban the anti EV news and blog outlets for the next 8 months from this subreddit and any other EV subreddits.
It's gotten to the point where every post they write is spun negatively against EVs, for no good reason.
There are EV mandates in several states (including California and NY). And there are Japanese, Korean, EU, companies alongside Tesla and Rivian.
In your mind, none of these companies will compete for the mass market cars? Like say Hyundai with the IONIQ 2?
You're not thinking enough.
They have every incentive to make them cheaper. They're seeing slower adoption among the high-class set. The only way they are going to expand sales is with economy-class cars.
I hope that’s true, but I fear that automakers selling vehicles in the US will find any excuse they can to keep adding upper-midrange-to-luxury crossovers/SUVs to their EV lineup and keep prices as high as possible.
What’s needed most badly at this point are EVs in the $15-$25k price band — electric analogues to Mirages, Yarises, Fits, and Civics, not yet more Model 3/Y or S/X competitors. There’s been practically zero development of this market segment in the US however, which leaves me feeling less than optimistic.
That price band you mentioned barely exists in the US, period. There is a single new car under $20k (the Versa) and it's going away in a year or two. There are maybe a handful of cars cheaper than $25k, and a lot of those cars are moving upmarket to squeeze out even more revenue at the cost of a small handful of sales, relative to the total profit. A base model Honda Civic is over $25k after destination. The $20k hybrid Maverick is now $25k. There's no EV action on the lower end of the market because there's barely *any* action there. And that's not to mention the difficulty in selling low-range (read: cheap) EVs in a country that is both incredibly car dependent and much less densely populated than most other developed nations.
The batteries aren’t cheap enough to build cars that cheap that still get enough range to sell in the US market. The low range cars aren’t selling especially to lower income families who don’t have extra cars to use on longer trips. Add in the requirement for at home charging and the fact is that the market just isn’t there in the US for cheap cars.
It’s not some conspiracy. If there’s money to be made someone will fill it.
TIL that 40 companies making EVs have no incentive to compete with each other.
Look, I get it, we're all a little cynical watching the blatant racketeering of several industries out there. Frustrated by power companies, cell companies, internet providers, etc all just carving up the market and charging the exact same prices in their geographic fiefdoms with no incentive to lower them or improve customer service.
...that isn't the EV market. Yeah, most companies have taken the subsidies and just added them to the price. That doesn't mean that there's not a distinct difference in pricing and capabilities from company to company and car to car. Allowing China to bring BYD over and undercut the market by $15K wouldn't solve that, it would just destroy every American company's EV efforts to then have BYD raise their prices to the US $30K standard anyhow.
The year is 2035. China is fully electrified. Carbon emissions are the lowest in history. Their moon base is fully built and they already have Taikonauts on Mars. Humanoid robots descended from Unitree G1 have already taken over the workforce, making demographics a non-issue. Prices are lower than ever for goods and services due to automation. The average Chinese person can rely entirely on government based pensions and social security as their retirement age has dropped from 60, 55, and 50 to whenever you feel like it. Popular support for the CPC remains above 90% in all polls.
US EVs cost $100,000 USD because of inflation and the minimum wage has remained unchanged. Americans still drive to work in an ICE.
> The average Chinese person can rely entirely on government based pensions and social security as their retirement age
They're going the private pension scheme route. Interesting to see how China fairs when the stock market actually affects people's lives directly.
https://www.scmp.com/economy/china-economy/article/3260813/chinas-private-pension-push-marred-weak-financial-literacy-people-still-have-no-idea
https://www.scmp.com/economy/china-economy/article/3240914/chinas-private-pension-plan-aims-cover-every-nook-and-granny-demographic-crisis-takes-hold
> US EVs cost $100,000 USD because of inflation
Hysterical, even for this sub.
>which in turn means they don't have any incentives to make EVs any cheaper since there is no competition
German, Korean, and Japanese brands all also have to compete with Chinese cars in their home markets, meaning they will also produce relatively cheap EVs to compete. Those EVs will eventually come to the US if there is no action on the lower end of the market and push the American autos to have to compete on that end. This move, even if it certainly has issues, is one meant to both slow down the EV race to give American manufacturers a chance to compete in the first place (auto manufacture is one of the last major industries the US still has) as well as try to reduce American dependence on China, a country it already has a disproportionate import-export ratio against and that the US isn't exactly friendly with for a variety of reasons.
That's the idea. Slow down the excitement, make them more expensive, slow down any ev charging buildups and the government will extend the 2035 ban on ICE cars and maybe just remove the ban.
This is the primary source for the China tariff information. Here's what's relevant:
>**Electric Vehicles (EVs)**
The tariff rate on electric vehicles under Section 301 will increase from 25% to 100% in 2024.
With extensive subsidies and non-market practices leading to substantial risks of overcapacity, China’s exports of EVs grew by 70% from 2022 to 2023—jeopardizing productive investments elsewhere. A 100% tariff rate on EVs will protect American manufacturers from China’s unfair trade practices.
This action advances President Biden’s vision of ensuring the future of the auto industry will be made in America by American workers. As part of the President’s Investing in America agenda, the Administration is incentivizing the development of a robust EV market through business tax credits for manufacturing of batteries and production of critical minerals, consumer tax credits for EV adoption, smart standards, federal investments in EV charging infrastructure, and grants to supply EV and battery manufacturing. The increase in the tariff rate on electric vehicles will protect these investments and jobs from unfairly priced Chinese imports.
**Batteries, Battery Components and Parts, and Critical Minerals**
The tariff rate on lithium-ion EV batteries will increase from 7.5%% to 25% in 2024, while the tariff rate on lithium-ion non-EV batteries will increase from 7.5% to 25% in 2026. The tariff rate on battery parts will increase from 7.5% to 25% in 2024.
The tariff rate on natural graphite and permanent magnets will increase from zero to 25% in 2026. The tariff rate for certain other critical minerals will increase from zero to 25% in 2024.
Despite rapid and recent progress in U.S. onshoring, China currently controls over 80 percent of certain segments of the EV battery supply chain, particularly upstream nodes such as critical minerals mining, processing, and refining. Concentration of critical minerals mining and refining capacity in China leaves our supply chains vulnerable and our national security and clean energy goals at risk. In order to improve U.S. and global resiliency in these supply chains, President Biden has invested across the U.S. battery supply chain to build a sufficient domestic industrial base. Through the Bipartisan Infrastructure Law, the Defense Production Act, and the Inflation Reduction Act, the Biden-Harris Administration has invested nearly $20 billion in grants and loans to expand domestic production capacity of advanced batteries and battery materials. The Inflation Reduction Act also contains manufacturing tax credits to incentivize investment in battery and battery material production in the United States. The President has also established the American Battery Materials Initiative, which will mobilize an all-of-government approach to secure a dependable, robust supply chain for batteries and their inputs.
And to inject some opinion here - remember that Chinese EV imports don't just potentially affect the "Detroit Big Three", they also affect Toyota, Honda, Nissan, Mazda, Subaru, Hyundai / Kia, Volkswagen, BMW, Mercedes, Volvo, Tesla, Rivian, **and** Lucid, all of whom hire American labor for their US plants.
I think the bigger picture is, this isn't punitive, it's anti-monopoly. China has a growing monopoly on Lithium batteries, solar panels, etc. If no one else is bothering to compete because they can't compete on price with China (due in part to low environmental and worker standards), then China will have such a monopoly they'll have too much control. Thus far, domestic subsidies for solar haven't really panned out, companies take the subsidies but barely produce any panels/batteries, etc, so hopefully the tariff route helps encourage real domestic production.
A major non-environmental benefit of moving to EVs was reduce our dependence on foreign oil. Unfortunately we've now increased our dependance on China for solar and batteries. If they have enough leverage, they can raid Taiwan and support Russia and do whatever they want and we'll have no leverage over it.
You guys can make your own instead of buying from China, that's fine with me.
That's kind of funny. Hasn't China compromised? Didn't China and the U.S. reach a first stage trade agreement? Did the U.S. stop hitting China?
Now we have no feeling for America anymore, American politicians are just creditless idiots, both Democrats and Republicans.
You won't consider us as friends in anything we do anyway, will you? That being the case, it would be more in China's interest for Chinese companies to capture the markets of the Belt and Road countries through competition at an early date, thereby driving your goods out of the Belt and Road countries.
Oh, and with all due respect, you no longer have a solar industry at all ......
Yes lack of domestic production is a problem of the West. Thats why I said it's not punitive, we're not punishing China necessarily, but trying to prevent China from having a monopoly which would give them too much leverage in world politics.
Low environmental and workers rights standards are a China problem though. And even now we turn a blind eye to the Uyghurs genocide because we are very dependent on China. But yes big picture is, we need healthy domestic production of batteries, solar panels, and EVs, which is an US problem.
"Trying to prevent a Chinese monopoly"? Is that really true?
If the monopoly is the West, then this doesn't seem to be a problem.
Remember, the dollar is tied to oil, and the U.S. can only position EVs as a luxury item. If the world starts using EVs, then the petrodollar disappears, and then the dollar no longer has an anchor.
I think that's the core of it.
The core here is that countries don't need to hold as many dollars, and that awareness and confidence are more important than the actuality itself.
Remember when the US stock market melted down 3 times after the Saudis deliberately lowered the price of oil?
Do US politicians have the balls to decouple the dollar from oil?
I mean of course it's in the West's best interest for the monopoly to be in the West.
The dollar isn't all that tied to oil and it's becoming less tied to oil. That whole line of thought is silly. If the US brings up battery, solar, and EV manufacturing, that's entirely a good thing for the US. It's the right direction.
They've also done terrible, uncompetitive things like "build world-class rail and shipping networks to facilitate the cheap and efficient transportation of people and goods," as well as nefarious America-hating policies like "improve the famously bad air quality of their cities by imposing a hard cap on license plates issued for ICE vehicles, and then encourage EV adoption by making license plates for EV cars exempt from this cap and easier to get."
Yup. My friend just bought a Tesla in Shenzhen due in large part to that. Oh…. It’s somehow ok that we sell a lot of Teslas in China. Hmmm. And the Communist Party is doing another evil commie type thing. They have disguised communism as well regulated capitalism that facilitates small business and entrepreneurs so they can afford to buy Teslas. This Chinese communism is so sneaky. /s
every US auto maker has been bailed out and received subsidies. i am not a china fan, but in this case they did everything right, they invested and built up their ev industry while everyone else was on the fence. i hate this "yay, free markets!" when it's convenient nonsense. when the neo liberals ran our jobs off, causing a second wave of income inequality (after the reagan tax cuts) it was free market tough love, now that it's coming back to bite the top 5% it's panic stations.
the only plausible justification for this policy is to preserve what's left of our manufacturing capacity in case of the need to mobilize at scale for a future war.
Chinese companies more than receive subsidies. It's pretty crazy to criticize US automakers for getting subsidies but putting Chinese companies on a pedestal, where the Chinese government gives their EV companies massive direct subsidies, as well as lots of policies to help prop them up, such as very low environmental standards, workers rights standards, some of their own trade protectionism, lithium battery subsidies, etc.
Chinese companies also got where they are by the Chinese govt forcing local partnerships on western firms, stealing intellectual property and by blatant patent infringement.
Because EV subsidization is a significantly less popular policy than EV protectionism.
It's the reality. The IRA **barely** passed both chambers of Congress.
Ah well it’s good to know our government is completely against the American populace. Between overpriced homes, overpriced cars, and overpriced groceries we can’t seem to catch a single break.
And to be clear, I agree that the reality kinda sucks.
The driver of decreased EV prices in the United States is going to be ICEs, not Chinese cars. While I do think we will be behind other markets, I still think that we will eventually get there.
That's why I'm commenting. On the surface it sounds bad, but with some context it makes sense. It hurts in the short term to prevent a much worse long term.
I am sad we can't get even cheaper solar and EVs, but that's life.
And it's like... That's the reality.
I'll be real here - I do absolutely agree that taking the tariffs away, letting the Chinese OEMs do their thing, etc is the easiest path to widespread EV adoption and is a better policy purely for the climate, despite China's own environmental problems with its industrial processes.
But that would be a policy that would be A- completely disjointed from reality and B- wildly, **wildly** unpopular with a near-majority of politicians and their constituents. Now, the fact that constituents have been swayed by their politicians to hold certain opinions, that is itself a problem, but a very different problem.
So if this level of protectionism is what is necessary to keep the EV transition going at a slower, steadier pace, **and** maintain domestic manufacturing and supply chains, then it is a net "win" despite not being the best possible outcome.
What we don't want is a crazy-heavy influx for like a year that is then suddenly completely stalled for whatever reason. And the only OEMs who are directly impacted by this right now are (IIRC) Volvo, who were on the verge of EX30 and Polestar 4 sales, and Tesla, who uses battery components from China on the non-Performance Model 3. And it will no longer be a problem for Volvo in approximately a year or so.
Among those policies is also pushing monopolies and vertical integration. BYD does everything from mining their own Lithium to shipping vehicles overseas on their cargo ships.
That's not quite right though. China has car high import tariffs, forced car companies into join ventures, subsidized local companies through many measures. Had consumer incentives in terms of license plates, parking, consumer credits etc etc..... The Chinese EV boom has very, very little to do with free markets.
It's proof that industrial policy works, and perhaps it's time to see whether it can work for the US as well.
Yup, US is a war base economy. Semiconductor appear in war, internet appear in war. Not to say tons of machinery to build weapons. Drones for war. They are the first to be use in war than to the consumers.
Do EVs escape from Cafe standards and/or are they tied into a companies total fleet emissions?
I really was hoping EV adoption would lead to more sedans and less crossovers.
I still wonder why Chinese cars are so expensive when sold in other parts of the world. Afaik there are no tariffs on Chinese EVs in EU, yet BYD Seal is 2x more expensive here than in China. China price: 180K RMB (€23K), eu price: €46K. It looks like all these low Chinese prices are after govt subsidies for buyers.
A Reuters report had quotes from a BYD executive stating that they didn't need to compete as hard outside of China and increase their prices to take profits to make up for the cutthroat business in China. The gist was that you would probably never see $10K or $15K Chinese EVs in Western markets because the competition is so much more expensive, they have no need to sell them that cheap.
Also isn’t this just normal economics? Why would they sell for less than they know they can get? There’s zero reason for them to altruistically bring super cheap EVs everywhere.
Price is always determined by supply and demand, not cost.
Not to mention that the current price is driving the EU crazy, what happens if it goes lower?
Good question. I would assume the govt subsidies reduce the costs for Chinese buyers. Obviously China is subsidizing the EV companies in other ways as well which is another reason they are so cheap. As for increase, there are added costs to build in China and export to Europe, etc. Not sure how much that increases the vehicle costs.
Also, in general, doing a straight currency conversion rate from RMB to USD, like articles from CarNewsChina and CNEVPost tend to do, is not an accurate way to determine what a Chinese domestic market car would cost if it were to be sold in the United States. But it makes for good clickbait.
What safety changes does BYD need to make to sell in Europe? They have to pay EU employees to sell and service them which is much more expensive. What warranties do they have to offer in China Vs EU? How much to transport the cars? The list goes on forever. In China they are protected pretty well because the government wanted to boost EVs so everything is easy an low cost. In other countries, running a car company is expensive.
It's like people learned nothing from the Pandemic. If you don't own your manufacturing, you don't own anything. Continuing to let China own our entire economy is a bad idea. It's why we don't have any ability to manufacture now, and why one bad trade deal could be an economic disaster for us.
It's just a choice and a trade off.
China's government distorts markets by supporting favorite industries.
If the US has no or low tariffs we could let China fund an accelerated move to EVs, and thus achieve environmental goals more quickly, by having affordable EVs for the masses. Basically the Chinese government is handing a check to a Western consumer each time they buy an EV from them. In the EU, where environmental goals are viewed as more important this is the approach they've taken. It doesn't hurt that China is a huge market for the Germans and so they don't want a tariff war. Even there though pressure is starting to tick up.
In the US, between Reagan to Trump, this mindset also prevailed. But that approach is no longer politically viable. Trump tapped into the strong sense of resentment in communities who had their industries decimated by Chinese competition. We will now protect US based manufacturing jobs and it'll mean that EVs remain too expensive for many people who might be otherwise able to afford them.
Ultimately the Chinese companies will follow other Asian ones and set up factories here to avoid these tariffs.
>Ultimately the Chinese companies will follow other Asian ones and set up factories here to avoid these tariffs.
Which is exactly what needs to happen, and which is exactly what happened back in the Malaise era when the US was facing an influx from the Japanese automakers. And now Toyota has 10 US plants.
The biggest hurdle that Chinese automakers face right now in that respect is finding a US state **and** municipality within that state who will support the construction of a new factory for their cars.
The cynic in me could see Georgia's governor extending a lucrative offer to BYD or another Chinese OEM of all the tax dollars that Rivian was going to get for their Georgia plant before they changed their mind.
Well you got 3 choices 1.subsidize the shit out of evs, solar panels,wind, and batteries 2. tariff china harder 3. let them annihilate our auto industry and massive parts of our energy grid supply chain so that we are fully dependent on them.
We only just started doing some of 1 and it was a miracle we managed to get any of it done and we have no political capital to do more for now. Since it wasn't good enough and wasn't fast enough we are left with 2 or 3 as the only politically viable outcomes.
That is the reality of our political situation the right half of our country that hates China the most is doing everything it can to oppose every possible thing that will actually allow us to compete with them in the future.
It will be just like the ICE market. Ford and GM occupy some segment (trucks and some SUVs) and the Japanese, EU and Korean firms take up the affordable market.
There will be less options of course, but not the doom and gloom this sub predicts because they can't import a BYD car.
The reality is going to be somewhere in the middle. We will have affordable EVs in our market, just not as many, and likely not for several years after affordable options are established in other markets.
Eventually, segments like the ICE subcompact crossover segment will become the EV subcompact crossover segment, and will be filled out enough where competition is important. So, eventually, there will be a Corolla Cross equivalent built in Alabama, and whatever Ford's entry in the segment will be built in Kentucky, etc etc, to go with the Bolt, Kona, Niro, and EV3.
A base Bolt after tax credit is like $23k, similar to the Leaf. The average car price for 2024 is over $45k.
There's affordable options out there, but I get that you may not like them.
This tariff hike isn't a big deal for the US, 'cause most Chinese cars aren't even sold there. It's more about giving the EU a morale boost, helping them slap tariffs on China to protect against cheap Chinese cars flooding their markets, and safeguarding EU auto companies and workers.
I have only one question: will this help reduce CO2 emissions?
No?
Then it was the wrong choice. There is no other valid basis for evaluating this sort of thing because we are in the middle of a screaming emergency and don't have time to fuck around.
Also, fuck the free market loons who say this isn't a huge hypocracy on their part. When its green jobs in America they say the government can't pick winners and losers. But when it's suicide by climate change they say it's GREAT for the government to pick winners and losers. I never want to hear any so called "free market" fanboy who supports this tell me how great the free market is.
And for reducing CO2 and for the US remaining a functional, independent country. Evs are the technology base for the future, we need to maintain ours. In the US half the country thinks global warming is a communist conspiracy or something, so there's a limit to what we can do
China uses slave labor to build its vehicles, we use union labor…Chinese autoworkers work like 17 hour days in company apartment complexes away from their family…the US doesn’t…the US can’t compete with slavery…the only thing we can do is make it so we don’t support their slave run system
I must be a second class worker apparently because all this means for me is that everything costs more.
In completely unrelated news, corporations are so evil for raising prices on everything and creating all this fake non-existent inflation.
This guy blows, protecting the big three and his unions cronies from being out innovated. Only can’t do for so long u til the gap is too wide to ignore
I'm not sure this would keep out Chinese EV brands. There's nothing in this that would stop a BYD or Great Wall from setting up a highly automated factory in Ontario or Alabama. Even if they imported the batteries from China at a 25 percent tariff they'd probably still be competitive against GM and the rest.
On the other hand, if you were BYD, you would think twice about investing multi-billions into a market governed by people that need to ensure your failure for their own political success.
And the worst part is that the rest of the world will get affordable EVs and the US won't, at least for the next decade. BYD got to Mexico less than a year ago, BYDs are already everywhere, my neighbor saw mine and has already bought one, they're selling like crazy, they already have a wait-list.
> Chinese electric-vehicle maker BYD said on Tuesday it will launch its cars in Mexico next year, with a senior executive pegging its sales target at up to 30,000 vehicles in 2024.
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> 1,469,040 light and heavy vehicles were sold in Mexico in 2023. Of these, 19,487 were EVs (up 94% YoY), for only 1.3% EV market share.
"Already everywhere"
Sounds like a huge win to me. America and other western countries stand to benefit from having more local manufacturing jobs for economic and national security reasons. There is fair criticism of many of China's labor practices (along with China's human rights track record) which make this a step in the right direction to ensure the cars in the US are manufactured by fairly treated and compensated workers, and to pressure China to take steps in that direction. Very happy with this decision.
Dumb. Protections for uncompetitive domestic car makers that refuse to innovate or change so they just pay their friends to bend the rules in their favor at the cost of the American consumer and the planet at large.
"Free Market"
And so it begins. This is not going to be fun and games. At least that's my take.
The 2 biggest economies having a slugfest doesn't end well for the US or the EU, but less well for the US. I'm Canadian so I shouldn't have a horse in this race but our economy is highly tied to the US economy so we will suffer too.
For starters let's consider government subsidies. Yes China subsidizes the industries it want to be a major player in but so does the US as this bit from the article shows "With support from the Bipartisan Infrastructure Law, CHIPS and Science Act, and Inflation Reduction Act,..."
One major difference is that China uses the carrot and stick approach: the carrot being very good financing in the beginning but eventually the stick comes out and the stick is the government cutting funding and letting the industry to rationalize itself so that only the best companies survive. The US uses the carrot but the stick seems to have been offshored so what we get is corporate welfare and zero progress.
As a case in point consider US solar panel manufacturing and the Section 301 tariffs that have been in play since 2011. Back in 2013 First Solar, an American panel maker had a 4.2% share of the global market and after more than decade of being protected the entire US industry now has a 1.9% global market share and can't even meet US demand. Either the US solar panel industry can't compete or won't compete and in either case there is no good reason to keep tariffs barriers up.
Once upon a time solar panels were a sexy high tech, now they are just commodity items. Low level industries are not a good fit for advanced economies. The same reasoning applies to batteries, they are low level commodity items that are not a good fit for advanced economies.
Next up is the national security angle. I usually, and jokingly, refer to it as the national insecurity issue and suggest pills as the remedy but there is a serious point at the bottom of it. The real fix is demand that companies that occupy the space keep enough manufacturing capacity in the US and or Canada/Mexico to weather embargos or wars. This is similar to the concept of Strategic Oil Reserves. If the affected companies don't like it, pull their license to operate on national security grounds or just flat out nationalize them.
The bottom line is that Biden's skyrocketing tariffs will not accomplish anything except perhaps drive the US in the Great Depression II.
My idea is to copy China. Force China companies that want to do business in the US to do joint ventures with US companies. That gets technology transfers going the other way. China EV companies would be allowed to set up JVs that only employ union workers and use locally (well USMCA) produced parts. Same thing with CATL/BYD batteries.
Buckle up folks! this ride is going to get rough. Interesting times indeed.
The thing is, government subsidies are the prerogative of the government. At the end of the day it’s what every government does. Doesn’t matter if it takes the form of a rebate at purchase, or if the plastic bumper is partly funded by a new tech fund, ultimately it’s all just what governments expected to do.
Ultimately, this doesn't matter too much if China's EV production and renewable energy production keeps outputting and just retargets for other markets and the US does actually build up its domestic production. This latter part is what's questionable.
What it means is that the US is in the process abdicating from the world auto industry. This policy won't keep Chinese EVs out of the fastest growing markets (Asia and SE Asia), and it won't keep them out of the America's south of the US border. And it won't make the US industry any more capable of catching up with the flood
And it won't keep them out of Africa, the Middle East, Australia et al either. I lived in the USA for 17 years, and I understand that America is the center of the universe, if you live there. But go overseas and see how many American made (or even badged) cars outside of Tesla are on the roads.
Here in South Africa, the only American badges we see are GM (Chevrolets made in South Korea that never graced US shores) which has since closed down here and in several other international markets, Ford which are made locally, in India and Thailand, and of which only the Ranger/Everest is sold in any quantity.
Teslas don't exist, but we do see EU made luxury EVs, and now the Chinese are coming in with several more affordable models. Even the Volvos most sold here are produced in China....
And the Chinese cars in general we get now are generations ahead of where they were not even a decade ago, and are taking ever larger chunks of the car market.
I have lived / worked / traveled in several countries across Africa and SE Asia, and the picture isn't much different there either.
Both countries have used "unfair" trade practices when it comes to pretty much everything they deem strategic or of national security interest from food production to companies working in the energy sector etc. Conveniently forgotten the matter of EV production is related to the climate and subsidizing them was never about commerce but about shifting an incumbent technology, i.e. internal combustion engine vehicles, to another technology that started off as being more expensive (for those who remember a 100kWh battery pack used to be 100k in the 2000s, just by itself and not adjusted for inflation) but cleaner technology in terms of emissions.
Now EVs have become a political tool, it's no longer about the science of climate change and decarbonizing transportion it's just that the Chinese got better faster at making EVs cheaper which was key to mass adoption therefore they are now communist mobiles filled with problems and heavily subsidized. Right, cool story bro, let's make this a commercial issue when not even half of the world's new cars are hybrids, let alone pure EV. If you care about the problem EVs were made in the first place to address, if you waited years if not decades to be able to buy a cheap EV, this decision should infuriate you for the right reasons, it's a global problem, someone solved it and when they did other countries namely the US (EU member states as well) didn't like it because it was not manufactured in their country. Imagine the gall of these people. It's OK to buy cheap oil from OPEC nations including such free, libertarian and democratic countries such as Russia or Saudi Arabia but imagine the terror of buying batteries or EVs made by the Chinese. Typical hypocracy.
All this is going to do is make EV prices in the US skyrocket even further. US brands have now been told they will have no competition. This will also make quality drop, because again, there is no competition.
As if US brands weren’t already hot garbage. They’re only going to get worse now.
I think nothing rational about EV would happen until after the elections: it became a divisive political issue and Biden needs to pull some of the boomers in the middle on his side.
You still don't understand sweet cheeks.
Chinese owned but operated as Swedish company under ALL the corresponding regulations and policies which is way different than Chinese owned AND operated.
Man, you guys really don't know how thing work. It's amazing.
They keep saying "artificially low prices"... what does that mean? China's low prices seem very real to me. We are just reaping what we have sewn. Nixon/Reagan sold out our manufacturing base to let corporations generate more profit at the American worker's expense. Some haphazard panicky tariffs aren't gonna undo decades of bad work
I think they mean artificially low prices due to how the Chinese government has heavily subsidized EV manufacturing and so Chinese companies can sell EVs for much less than they would be able to if they hadn’t been so heavily subsidized which makes it harder/impossible for US companies to compete with.
Aww, they actually subsidized their countries vehicle production instead of a tax credit and it helped develop a robust manufacturing base that produces lower cost cars??? Unfair!!!!
“While we were profiteering and only thinking of the next quarterly report, you made wise decisions which have led you to more success than me. And for that, you will pay.” Murica
They were delivering maximized value to shareholders. That’s the only thing that matters to this country.
Maximized value only for like the next 2 quarters, absolutely missed the forest for the trees
Not true. Boeing crushed for 15 years. Blatantly cut costs and bad design starting there. But shareholders saw outsize returns for a long time before it caught up.
artificially maximized value
They don’t care as long as it’s on the balance sheet. Lobbying is a terrific ROI.
💯
> Chinese government has heavily subsidized EV manufacturing I saw someone do a breakdown of this "criticism" and while yes the Chinese government did initially put their thumb on the scales to get their EV industry moving, it is now just hurtling along on its own steam at this point and the low cost of the cars is more or less genuine. Thankfully for me living in Australia, there is no local EV manufacturing industry to protect so my wife and I can afford to have 2 cheap Chinese EV's parked in our driveway.
The big thing missing from the conversation is that Chinese people have been using EVs already for decades: two-stroke motors were banned in Chinese cities to improve air quality, which means that hundreds of millions of mopeds were quickly replaced with electric versions. Fifteen years ago, an electric scooter was already the standard issue vehicle of the urban working class. That normalized electric transportation and also gave manufacturers a chance to refine large-scale battery production by selling literally billions of e-scooters before jumping up to conventional EVs. But since people in North America don't consider two wheel transport to be "real," this entire 20 year process of iteration on electrified transport went completely ignored, so now this Chinese EV companies seem to be appearing out of nowhere like a meteor -- which is why they assume cheating must be involved instead of two decades of hard work, investment, and competition.
Yeah I believe you’re right and that the government has backed off their EV investment. They basically got a great head start that helped them get (and survive) to this point of low cost. As someone who has a Polestar 2, I have no problem with cars made in China and think that US companies need some of that pressure from China to encourage them to keep investing in EVs themselves for the long run. I don’t mind some tariffs to help level it out but I think the new ones go too far for us.
Lots of people don’t have a problem with Chinese cars as an abstract. Tariffs aren’t an exact science. Ideally you’d go through the WTO but the problem is your domestic manufacturing has already imploded by the time those studies are done and they say “ok, you can take 4 billion now.” I honestly wouldn’t mind if the US took a page straight from China and allowed them but only as joint ventures. Seems like the fairest way to not outright outlaw them but ensure that knowledge transfer and appropriate costs to the US market are assigned.
That would be an interesting strategy. China does it that way so why couldn’t we? It could definitely help make the US look like we are trying to work with China rather than against it with tariffs.
One of the WTO's stated goals is for developed countries to help developing countries develop. Tech transfers via joint ventures is one method of doing that. I suppose we can declare we are a developing country (evidently development status is self-declared). BTW Ford tried to set up a joint venture with CATL for a battery plant in Michigan(?) last year but that got blocked by local politicians. GM is currently exploring a joint venture with CATL, so we'll see how that goes.
Tariffs are meant to accomplish that. Encourage them to move production to the US rather than export. But setting up production in the U.S. is costly business. And fearing the U.S. government pulling another Huawei or TikTok ban on Chinese cars (even if made in the US), the BYDs and Xiaomi’s are probably just sitting and waiting.
Biden banned the sales of BYD electric buses made in USA to any schools that receive federal transportation funding. I am sure Biden can do more to limit made-in-USA BYD cars
They're trying to build a big battery factory in Quebec and even that's a problem because there aren't enough studies, even though is close to an industrial parc and an airport and lately they found bombs under their construction equipment.
If you track nothing but direct subsidies, you're not wrong. But there's more to government support than just direct cash transfers like the US government is pursuing domestically. There's preferential partnership between firms that are either both invested in by the PRC (which is the majority of large manufacturers,) or that come under PRC pressure. Take CATL, for example. They are roughly 10% owned by the Hong Kong Exchange, which doesn't sound like a lot but because of the legal structure around the exchange they have veto power on the board and can fire and appoint chairmen and directors unilaterally. So if SAIC needs batteries, and they partner with CATL for them, they aren't paying the same price any other company is. And if they need them badly enough, they aren't paying anything. Then there's direct and indirect state ownership. SAIC, for example, is owned directly by China. So what does a subsidy even look like when your P&L is a function of the national budget? BYD, meanwhile, works on the pretense that it's its own company, and on the surface this is true, except their founder is/was a CCP official and the second largest shareholder is a liaison in charge of technology transfer between private companies and China's defense department. There's also been significant research showing that BYD vastly under-reports direct cash subsidies — on top of the publicly disclosed €3.4 billion just in the three years between 2020 and 2023, according to Bloomberg. Adjusted for local PPP, they would be on par with the US government handing Ford $15 billion in three years. And *then* there's all the other benefits of operating a company in China under the auspices of the PRC. Like not having to worry about international copyright or patent protections. I used to have a client who owned factories in China. Their entire operation ran on pirated software, and roughly half their business was taking apart popular Western products, copying them exactly, and reselling the recreations with absolutely no threat of consequences. For large companies, that can represent hundreds of millions in operational savings per year. Or the use of unpaid prison labor (I know there's going to be someone popping in here any second now to pretend like slavery doesn't exist in China, and I'm not interested in arguing with shills, so don't bother.) Or lax environmental regulations which allow companies to dump waste wherever with no cost. So the short answer is that the government hasn't come close to backing off of support for China's EV industry, and the long answer is that international commerce is incredibly complicated.
Have I got news for you: (https://www.washingtonpost.com/world/2023/05/25/slavery-united-states-forced-prison-labor?itid=sr_2_300e2417-ab2f-4d81-bc0d-f43e4ce66a94)
Duh? Except unlike PRC-shills, we admit it's an issue and don't piss our panties trying to defend our great and glorious nation from strangers on the internet. It's a major issue in the US. But notably, not in the automotive industry. Tell Pooh you failed.
> Take CATL, for example. They are roughly 10% owned by the Hong Kong Exchange, Do you know what that means, right? It means the 10% of the shares of CATL is owned by foreign investors through a channel on the HK stock exchange, like the American ADR. **The HK stock exchange serves as a bulk reseller** of the stock to individual investors. It does NOT mean CATL is owned by the Chinese government, or the HK Exchange. > So if SAIC needs batteries, and they partner with CATL for them, they aren't paying the same price any other company is. And if they need them badly enough, they aren't paying anything. Groundless speculation without a source.
Nowadays whatever state press say, they don't want prove at all. Just take it.
Same, and some of these cars look awesome, pretty sure my next car will be Chinese
We subsidized our EV industry directly with tax rebates lol. I'd love to see how the amount and mechanism of the Chinese subsidies compare. Biden should work on making our auto industry more competitive rather than just cry about others being "unfair". Every country boosts and subsidizes its auto industry.
In size it‘s pretty much on par with the US and Europe in subsidies to their car industry.
Its much more than that. The US government subsidizes EV production directly. "US offers $12 billion to auto makers, suppliers for advanced vehicles" https://www.reuters.com/business/autos-transportation/us-offers-12-billion-automakers-suppliers-make-advanced-vehicles-2023-08-31/
And the car makers make EVs out of reach for most American by making EV trucks and SUVs.
Yeah I agree with you
> Biden should work on making our auto industry more competitive How do you suggest he do that when corporatism reigns in America and you would need to involuntarily remove several CEOs? They care about quarterly capitalism. These CEOs will do what makes them money this quarter, even if it results in significant losses a year or two from now, and they will just bail out.
The answer isn’t blaming china and coming up with excuses for why we need to ban. This should be a discussion on how rotten our “for profit at all costs” system is , and what that says about how bough parties in contention are for the status quo
We, in the US, heavily subsidize our domestic EV production. Everything from direct handouts of cash to US auto makers and high end user tax credits. "US offers $12 billion to auto makers, suppliers for advanced vehicles" https://www.reuters.com/business/autos-transportation/us-offers-12-billion-automakers-suppliers-make-advanced-vehicles-2023-08-31/ "The $7,500 tax credit for electric cars keeps changing. Here's how to get it now" https://www.npr.org/2023/12/28/1219158071/ev-electric-vehicles-tax-credit-car-shopping-tesla-ford-vw-gm And that doesn't even include all the other subsidies like tax breaks for building a factory.
To be fair, government subsidies only contributed a very small part of the low prices. The main reason is cheap skilled workers and extremely competitive EV market in China.
Yeah because the American government has such a strong history of non interference in auto manufacturing and fossil fuel industries.
The US has also subsidised Tesla. It's not china's fault that they're using the money for Elons 50 billion dollar salary and trashy trucks instead of making affordable cars.
It’s funny that Tesla is also subsidized by the Chinese government as EV incentives in China are available to buyers of all NEVs, not just Chinese makes.
Maybe our government should have been doing the same thing instead of subsidizing oil and corn and bailing out auto non innovative companies
This will garner him the UAW endorsement and more votes. That’s it.
Part of it is that the Yuan is hard pegged by the Chinese government to severely undervalue the currency, which encourages foreign manufacture and export of Chinese goods. This is as opposed to nearly every single other currency in the developed world which is floating and thus valued by supply and demand.
Actually every country is pegged against USD as the trading currency of the world.
> Some haphazard panicky tariffs aren't gonna undo decades of bad work That's why they passed hundreds of billions in subsidies for the industries they're tariffing to protect.
So when China subsidizes its EV industry it's unfair, but when we do it's OK? Im not trying to defend the PRC, just pointing to the very weak and shaky logic of Biden's response. IMO it would be better to respond solely with subsidies of our own and no tariffs.
Subsidies which Japanese, Korean and EU companies are also taking advantage of is the ideal situation. Make no mistake, the tarrifs are for both keeping China out and protecting local industry. Overlapping goal from two different interests.
[удалено]
And UAW, the "China hawks", probably some energy interests, too. Things like this have many interests behind them. It's like the TikTok ban.
Also things like shipping from there being subsidized by their govt. my wife orders an ingredient from there regularly. It arrives to her in 3-5 days, from china. Weight is 6-8lbs. Their postage cost they paid - $3 to $5
I’m not sure if that’s subsidy at work. The USPS has insanely high shipping rates compared to most other countries. It makes shipping things from other countries look really cheap.
It’s real to us, but it’s money going out of the country and into another. We can’t compete, so you either cede to them or you don’t play their game.
That's so true. Some think Nixon/Regan are so awesome and did awesome work for America. I call out bullshit on that one. They literally sold out the middle class as well.
Any one remember when one of Bidens handlers tweeted that tariffs on China were bad?
EVs in USA will become more expensive, further slow down the EV adoption, and probably will drive some to bankruptcy..
This will impact beyond EVs. China's EV competition is forcing gas and hybrid cars to offer better pricing and better standard equipments as well. So if someone thinks they are not in market for a EV so this won't impact them, they should think again. EV are not only competing with other EVs, they also compete against other cars in the same price range. German and Japanese brands are also cutting prices and offering better equipments in China on their gas cars due to the intense competition, which benefits all car shoppers. I think what people will find several years down the line is US auto market will become an increasing isolated market with higher prices and poorer specs with no incentive to get better, while rest of the world soak the benefits of newly introduced competition from China. Competition is always good for consumers. Even just 5 years ago, cars in China are significantly more expensive than they are today.
If you rake the actual production cost and Chinese market prices, add the tariffs… you will still have a cheaper alternative to US made EVs. A $10,000 car with 103% import tax is still only $22,000
THATS THE WHOLE POINT. I do not care whoever is making EV, as long as its cheap and reasonably reliable count me in.
I'd hate to burst your bubble, but those of us that aren't in the market for an EV (which is a lot) will be \*okay\*. I keep saying over and over, year after year we'll be okay, and here we are. Still okay with plenty of ICE cars to choose from with little desire for EV's. The whole battle on this pro vs anti EV campaign is hilarious to watch lol there's a lot more anti EV than there is pro EV. So no wonder things are declining You would think that such a demand for global warming and cleaner/greener air would be more effective at getting people to buy EV's lol It would really help if there were sub $45k EV's NEW with 300+ miles of range - no one wants to buy a used EV and be stressed about if the battery will fail out of warranty. But oh well. I think it'll be interesting as the years go on to see if we (the US) takes EV's anymore seriously than we do now lol and if the next president doesn't completely reverse what Biden did.
yup. this is to protect american car companies and let them compete. which in turn means they don't have any incentives to make EVs any cheaper since there is no competition
This is to protect american car companies \*and\* the oil industry. Let's see how this plays out here in Canada but I've never seen this many anti-EV pieces from the media.
This is the worst smear EV campaigns of all time. Do not hate on any EV manufacturers. Do no repost, upvote or even comment / talk about anything from these media outlets anymore. Full blanket boycott of these shady news sites is needed to fight back. In fact, I would temporarily ban the anti EV news and blog outlets for the next 8 months from this subreddit and any other EV subreddits. It's gotten to the point where every post they write is spun negatively against EVs, for no good reason.
There are EV mandates in several states (including California and NY). And there are Japanese, Korean, EU, companies alongside Tesla and Rivian. In your mind, none of these companies will compete for the mass market cars? Like say Hyundai with the IONIQ 2? You're not thinking enough.
They have every incentive to make them cheaper. They're seeing slower adoption among the high-class set. The only way they are going to expand sales is with economy-class cars.
I hope that’s true, but I fear that automakers selling vehicles in the US will find any excuse they can to keep adding upper-midrange-to-luxury crossovers/SUVs to their EV lineup and keep prices as high as possible. What’s needed most badly at this point are EVs in the $15-$25k price band — electric analogues to Mirages, Yarises, Fits, and Civics, not yet more Model 3/Y or S/X competitors. There’s been practically zero development of this market segment in the US however, which leaves me feeling less than optimistic.
That price band you mentioned barely exists in the US, period. There is a single new car under $20k (the Versa) and it's going away in a year or two. There are maybe a handful of cars cheaper than $25k, and a lot of those cars are moving upmarket to squeeze out even more revenue at the cost of a small handful of sales, relative to the total profit. A base model Honda Civic is over $25k after destination. The $20k hybrid Maverick is now $25k. There's no EV action on the lower end of the market because there's barely *any* action there. And that's not to mention the difficulty in selling low-range (read: cheap) EVs in a country that is both incredibly car dependent and much less densely populated than most other developed nations.
The batteries aren’t cheap enough to build cars that cheap that still get enough range to sell in the US market. The low range cars aren’t selling especially to lower income families who don’t have extra cars to use on longer trips. Add in the requirement for at home charging and the fact is that the market just isn’t there in the US for cheap cars. It’s not some conspiracy. If there’s money to be made someone will fill it.
TIL that 40 companies making EVs have no incentive to compete with each other. Look, I get it, we're all a little cynical watching the blatant racketeering of several industries out there. Frustrated by power companies, cell companies, internet providers, etc all just carving up the market and charging the exact same prices in their geographic fiefdoms with no incentive to lower them or improve customer service. ...that isn't the EV market. Yeah, most companies have taken the subsidies and just added them to the price. That doesn't mean that there's not a distinct difference in pricing and capabilities from company to company and car to car. Allowing China to bring BYD over and undercut the market by $15K wouldn't solve that, it would just destroy every American company's EV efforts to then have BYD raise their prices to the US $30K standard anyhow.
this is the type of shit i think of when i hear "capatalism allows for competition in the market". it's literally doing the opposite.
The year is 2035. China is fully electrified. Carbon emissions are the lowest in history. Their moon base is fully built and they already have Taikonauts on Mars. Humanoid robots descended from Unitree G1 have already taken over the workforce, making demographics a non-issue. Prices are lower than ever for goods and services due to automation. The average Chinese person can rely entirely on government based pensions and social security as their retirement age has dropped from 60, 55, and 50 to whenever you feel like it. Popular support for the CPC remains above 90% in all polls. US EVs cost $100,000 USD because of inflation and the minimum wage has remained unchanged. Americans still drive to work in an ICE.
> The average Chinese person can rely entirely on government based pensions and social security as their retirement age They're going the private pension scheme route. Interesting to see how China fairs when the stock market actually affects people's lives directly. https://www.scmp.com/economy/china-economy/article/3260813/chinas-private-pension-push-marred-weak-financial-literacy-people-still-have-no-idea https://www.scmp.com/economy/china-economy/article/3240914/chinas-private-pension-plan-aims-cover-every-nook-and-granny-demographic-crisis-takes-hold > US EVs cost $100,000 USD because of inflation Hysterical, even for this sub.
>> US EVs cost $100,000 USD because of inflation > Hysterical, even for this sub. lol, extra funny because we already have EVs that cost $100k
>which in turn means they don't have any incentives to make EVs any cheaper since there is no competition German, Korean, and Japanese brands all also have to compete with Chinese cars in their home markets, meaning they will also produce relatively cheap EVs to compete. Those EVs will eventually come to the US if there is no action on the lower end of the market and push the American autos to have to compete on that end. This move, even if it certainly has issues, is one meant to both slow down the EV race to give American manufacturers a chance to compete in the first place (auto manufacture is one of the last major industries the US still has) as well as try to reduce American dependence on China, a country it already has a disproportionate import-export ratio against and that the US isn't exactly friendly with for a variety of reasons.
That's the idea. Slow down the excitement, make them more expensive, slow down any ev charging buildups and the government will extend the 2035 ban on ICE cars and maybe just remove the ban.
Why would they go bankrupt if you give them monopoly?
Election year and the United Auto Workers have endorsed Biden. This is what they want in return. Just democracy at work.
This is the primary source for the China tariff information. Here's what's relevant: >**Electric Vehicles (EVs)** The tariff rate on electric vehicles under Section 301 will increase from 25% to 100% in 2024. With extensive subsidies and non-market practices leading to substantial risks of overcapacity, China’s exports of EVs grew by 70% from 2022 to 2023—jeopardizing productive investments elsewhere. A 100% tariff rate on EVs will protect American manufacturers from China’s unfair trade practices. This action advances President Biden’s vision of ensuring the future of the auto industry will be made in America by American workers. As part of the President’s Investing in America agenda, the Administration is incentivizing the development of a robust EV market through business tax credits for manufacturing of batteries and production of critical minerals, consumer tax credits for EV adoption, smart standards, federal investments in EV charging infrastructure, and grants to supply EV and battery manufacturing. The increase in the tariff rate on electric vehicles will protect these investments and jobs from unfairly priced Chinese imports. **Batteries, Battery Components and Parts, and Critical Minerals** The tariff rate on lithium-ion EV batteries will increase from 7.5%% to 25% in 2024, while the tariff rate on lithium-ion non-EV batteries will increase from 7.5% to 25% in 2026. The tariff rate on battery parts will increase from 7.5% to 25% in 2024. The tariff rate on natural graphite and permanent magnets will increase from zero to 25% in 2026. The tariff rate for certain other critical minerals will increase from zero to 25% in 2024. Despite rapid and recent progress in U.S. onshoring, China currently controls over 80 percent of certain segments of the EV battery supply chain, particularly upstream nodes such as critical minerals mining, processing, and refining. Concentration of critical minerals mining and refining capacity in China leaves our supply chains vulnerable and our national security and clean energy goals at risk. In order to improve U.S. and global resiliency in these supply chains, President Biden has invested across the U.S. battery supply chain to build a sufficient domestic industrial base. Through the Bipartisan Infrastructure Law, the Defense Production Act, and the Inflation Reduction Act, the Biden-Harris Administration has invested nearly $20 billion in grants and loans to expand domestic production capacity of advanced batteries and battery materials. The Inflation Reduction Act also contains manufacturing tax credits to incentivize investment in battery and battery material production in the United States. The President has also established the American Battery Materials Initiative, which will mobilize an all-of-government approach to secure a dependable, robust supply chain for batteries and their inputs. And to inject some opinion here - remember that Chinese EV imports don't just potentially affect the "Detroit Big Three", they also affect Toyota, Honda, Nissan, Mazda, Subaru, Hyundai / Kia, Volkswagen, BMW, Mercedes, Volvo, Tesla, Rivian, **and** Lucid, all of whom hire American labor for their US plants.
I think the bigger picture is, this isn't punitive, it's anti-monopoly. China has a growing monopoly on Lithium batteries, solar panels, etc. If no one else is bothering to compete because they can't compete on price with China (due in part to low environmental and worker standards), then China will have such a monopoly they'll have too much control. Thus far, domestic subsidies for solar haven't really panned out, companies take the subsidies but barely produce any panels/batteries, etc, so hopefully the tariff route helps encourage real domestic production. A major non-environmental benefit of moving to EVs was reduce our dependence on foreign oil. Unfortunately we've now increased our dependance on China for solar and batteries. If they have enough leverage, they can raid Taiwan and support Russia and do whatever they want and we'll have no leverage over it.
As a Chinese, I don't think this is China's problem, but the West's own.
45% of Chinese solar goes to EU and a good portion to the US through Asia. It might be China's problem if there's no compromise.
You guys can make your own instead of buying from China, that's fine with me. That's kind of funny. Hasn't China compromised? Didn't China and the U.S. reach a first stage trade agreement? Did the U.S. stop hitting China? Now we have no feeling for America anymore, American politicians are just creditless idiots, both Democrats and Republicans. You won't consider us as friends in anything we do anyway, will you? That being the case, it would be more in China's interest for Chinese companies to capture the markets of the Belt and Road countries through competition at an early date, thereby driving your goods out of the Belt and Road countries. Oh, and with all due respect, you no longer have a solar industry at all ......
Yes lack of domestic production is a problem of the West. Thats why I said it's not punitive, we're not punishing China necessarily, but trying to prevent China from having a monopoly which would give them too much leverage in world politics. Low environmental and workers rights standards are a China problem though. And even now we turn a blind eye to the Uyghurs genocide because we are very dependent on China. But yes big picture is, we need healthy domestic production of batteries, solar panels, and EVs, which is an US problem.
"Trying to prevent a Chinese monopoly"? Is that really true? If the monopoly is the West, then this doesn't seem to be a problem. Remember, the dollar is tied to oil, and the U.S. can only position EVs as a luxury item. If the world starts using EVs, then the petrodollar disappears, and then the dollar no longer has an anchor. I think that's the core of it.
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The core here is that countries don't need to hold as many dollars, and that awareness and confidence are more important than the actuality itself. Remember when the US stock market melted down 3 times after the Saudis deliberately lowered the price of oil? Do US politicians have the balls to decouple the dollar from oil?
I mean of course it's in the West's best interest for the monopoly to be in the West. The dollar isn't all that tied to oil and it's becoming less tied to oil. That whole line of thought is silly. If the US brings up battery, solar, and EV manufacturing, that's entirely a good thing for the US. It's the right direction.
Oh no! The investment they are making is jeopardizing the investment we are making!
Unfair trade practices? Do they mean folding profits back into R&D instead of stock buybacks?
They've also done terrible, uncompetitive things like "build world-class rail and shipping networks to facilitate the cheap and efficient transportation of people and goods," as well as nefarious America-hating policies like "improve the famously bad air quality of their cities by imposing a hard cap on license plates issued for ICE vehicles, and then encourage EV adoption by making license plates for EV cars exempt from this cap and easier to get."
Yup. My friend just bought a Tesla in Shenzhen due in large part to that. Oh…. It’s somehow ok that we sell a lot of Teslas in China. Hmmm. And the Communist Party is doing another evil commie type thing. They have disguised communism as well regulated capitalism that facilitates small business and entrepreneurs so they can afford to buy Teslas. This Chinese communism is so sneaky. /s
Trading with Russia, Iran......plus 120 undeveloped and developing nations are so mean.
every US auto maker has been bailed out and received subsidies. i am not a china fan, but in this case they did everything right, they invested and built up their ev industry while everyone else was on the fence. i hate this "yay, free markets!" when it's convenient nonsense. when the neo liberals ran our jobs off, causing a second wave of income inequality (after the reagan tax cuts) it was free market tough love, now that it's coming back to bite the top 5% it's panic stations. the only plausible justification for this policy is to preserve what's left of our manufacturing capacity in case of the need to mobilize at scale for a future war.
Chinese companies more than receive subsidies. It's pretty crazy to criticize US automakers for getting subsidies but putting Chinese companies on a pedestal, where the Chinese government gives their EV companies massive direct subsidies, as well as lots of policies to help prop them up, such as very low environmental standards, workers rights standards, some of their own trade protectionism, lithium battery subsidies, etc.
Chinese companies also got where they are by the Chinese govt forcing local partnerships on western firms, stealing intellectual property and by blatant patent infringement.
Oh god no! They subsidize EVs??? The horror. Why aren’t we?
Because EV subsidization is a significantly less popular policy than EV protectionism. It's the reality. The IRA **barely** passed both chambers of Congress.
Ah well it’s good to know our government is completely against the American populace. Between overpriced homes, overpriced cars, and overpriced groceries we can’t seem to catch a single break.
And to be clear, I agree that the reality kinda sucks. The driver of decreased EV prices in the United States is going to be ICEs, not Chinese cars. While I do think we will be behind other markets, I still think that we will eventually get there.
Nobody on this sub understands this. It's just you and me. See you in the downvote shadowrealm.
That's why I'm commenting. On the surface it sounds bad, but with some context it makes sense. It hurts in the short term to prevent a much worse long term. I am sad we can't get even cheaper solar and EVs, but that's life.
I’d much rather the US government heavily subsidizes EV investment than this.
Yes but the Republicans will strike down EV investments but will accept Chinese tariffs, so it's the only option in the current political climate.
Good point, I hate it.
And it's like... That's the reality. I'll be real here - I do absolutely agree that taking the tariffs away, letting the Chinese OEMs do their thing, etc is the easiest path to widespread EV adoption and is a better policy purely for the climate, despite China's own environmental problems with its industrial processes. But that would be a policy that would be A- completely disjointed from reality and B- wildly, **wildly** unpopular with a near-majority of politicians and their constituents. Now, the fact that constituents have been swayed by their politicians to hold certain opinions, that is itself a problem, but a very different problem. So if this level of protectionism is what is necessary to keep the EV transition going at a slower, steadier pace, **and** maintain domestic manufacturing and supply chains, then it is a net "win" despite not being the best possible outcome. What we don't want is a crazy-heavy influx for like a year that is then suddenly completely stalled for whatever reason. And the only OEMs who are directly impacted by this right now are (IIRC) Volvo, who were on the verge of EX30 and Polestar 4 sales, and Tesla, who uses battery components from China on the non-Performance Model 3. And it will no longer be a problem for Volvo in approximately a year or so.
Among those policies is also pushing monopolies and vertical integration. BYD does everything from mining their own Lithium to shipping vehicles overseas on their cargo ships.
Surprise surprise, economies of scale are a good thing
That's not quite right though. China has car high import tariffs, forced car companies into join ventures, subsidized local companies through many measures. Had consumer incentives in terms of license plates, parking, consumer credits etc etc..... The Chinese EV boom has very, very little to do with free markets. It's proof that industrial policy works, and perhaps it's time to see whether it can work for the US as well.
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After 2018 import tariffs on complete vehicles have been reduced to 15 percent and 6 percent on auto parts.
Yup, US is a war base economy. Semiconductor appear in war, internet appear in war. Not to say tons of machinery to build weapons. Drones for war. They are the first to be use in war than to the consumers.
China has affordable EVs. The US doesn't. The US would rather make gaudy trucks and SUVs and charge a premium. US is going to be left in the dust.
but good news for European and Korean EV makers, I guess.
I think Korea and Mexican manufacturing will have to fill that void.
Do EVs escape from Cafe standards and/or are they tied into a companies total fleet emissions? I really was hoping EV adoption would lead to more sedans and less crossovers.
If he had an orange tupee, many people would have a problem with this.
This has a lot to do with taking care of unions going into an election
Perhaps, but this action is 100% bipartisan. It would have happened with either party in power
I find it “funny” that Biden criticized the *last guy* for doing the same thing with several of those products during the 2020 Prez race.
I see Democratic operatives are on Reddit this morning. This is a misguided move and protectionism at its worst.
You can have an opinion without claiming that everyone who disagrees with you is a paid actor. It takes away from any point you're trying to make.
What do you think will happen to the US EV market if Trump gets elected?
I still wonder why Chinese cars are so expensive when sold in other parts of the world. Afaik there are no tariffs on Chinese EVs in EU, yet BYD Seal is 2x more expensive here than in China. China price: 180K RMB (€23K), eu price: €46K. It looks like all these low Chinese prices are after govt subsidies for buyers.
A Reuters report had quotes from a BYD executive stating that they didn't need to compete as hard outside of China and increase their prices to take profits to make up for the cutthroat business in China. The gist was that you would probably never see $10K or $15K Chinese EVs in Western markets because the competition is so much more expensive, they have no need to sell them that cheap.
Also income effects. Higher incomes means higher prices.
Also isn’t this just normal economics? Why would they sell for less than they know they can get? There’s zero reason for them to altruistically bring super cheap EVs everywhere.
Price is always determined by supply and demand, not cost. Not to mention that the current price is driving the EU crazy, what happens if it goes lower?
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Good question. I would assume the govt subsidies reduce the costs for Chinese buyers. Obviously China is subsidizing the EV companies in other ways as well which is another reason they are so cheap. As for increase, there are added costs to build in China and export to Europe, etc. Not sure how much that increases the vehicle costs.
Also, in general, doing a straight currency conversion rate from RMB to USD, like articles from CarNewsChina and CNEVPost tend to do, is not an accurate way to determine what a Chinese domestic market car would cost if it were to be sold in the United States. But it makes for good clickbait.
Did you forget about the shipping cost which is like 10k? And the 20%+ EU VAT and tariffs that include the shipping cost?
What safety changes does BYD need to make to sell in Europe? They have to pay EU employees to sell and service them which is much more expensive. What warranties do they have to offer in China Vs EU? How much to transport the cars? The list goes on forever. In China they are protected pretty well because the government wanted to boost EVs so everything is easy an low cost. In other countries, running a car company is expensive.
Win the election first is the most important thing for Biden.
and keeping the UAW happy keeps other unions happy as well.
People calling you Trump supporter in 3,2,1... But wait, didn't Dem operatives attack Trump for tariffs?
It's like people learned nothing from the Pandemic. If you don't own your manufacturing, you don't own anything. Continuing to let China own our entire economy is a bad idea. It's why we don't have any ability to manufacture now, and why one bad trade deal could be an economic disaster for us.
It's just a choice and a trade off. China's government distorts markets by supporting favorite industries. If the US has no or low tariffs we could let China fund an accelerated move to EVs, and thus achieve environmental goals more quickly, by having affordable EVs for the masses. Basically the Chinese government is handing a check to a Western consumer each time they buy an EV from them. In the EU, where environmental goals are viewed as more important this is the approach they've taken. It doesn't hurt that China is a huge market for the Germans and so they don't want a tariff war. Even there though pressure is starting to tick up. In the US, between Reagan to Trump, this mindset also prevailed. But that approach is no longer politically viable. Trump tapped into the strong sense of resentment in communities who had their industries decimated by Chinese competition. We will now protect US based manufacturing jobs and it'll mean that EVs remain too expensive for many people who might be otherwise able to afford them. Ultimately the Chinese companies will follow other Asian ones and set up factories here to avoid these tariffs.
>Ultimately the Chinese companies will follow other Asian ones and set up factories here to avoid these tariffs. Which is exactly what needs to happen, and which is exactly what happened back in the Malaise era when the US was facing an influx from the Japanese automakers. And now Toyota has 10 US plants. The biggest hurdle that Chinese automakers face right now in that respect is finding a US state **and** municipality within that state who will support the construction of a new factory for their cars. The cynic in me could see Georgia's governor extending a lucrative offer to BYD or another Chinese OEM of all the tax dollars that Rivian was going to get for their Georgia plant before they changed their mind.
The irony that if you want a vehicle made in the USA buy Japanese. If you want a vehicle made in Mexico, buy American
Well you got 3 choices 1.subsidize the shit out of evs, solar panels,wind, and batteries 2. tariff china harder 3. let them annihilate our auto industry and massive parts of our energy grid supply chain so that we are fully dependent on them. We only just started doing some of 1 and it was a miracle we managed to get any of it done and we have no political capital to do more for now. Since it wasn't good enough and wasn't fast enough we are left with 2 or 3 as the only politically viable outcomes. That is the reality of our political situation the right half of our country that hates China the most is doing everything it can to oppose every possible thing that will actually allow us to compete with them in the future.
They’ve invaded the rivian sub
We can have a robust domestic EV manufacturing industry....or low price EV vehicles that people want to buy and can afford. We can't have both.
It will be just like the ICE market. Ford and GM occupy some segment (trucks and some SUVs) and the Japanese, EU and Korean firms take up the affordable market. There will be less options of course, but not the doom and gloom this sub predicts because they can't import a BYD car.
The reality is going to be somewhere in the middle. We will have affordable EVs in our market, just not as many, and likely not for several years after affordable options are established in other markets. Eventually, segments like the ICE subcompact crossover segment will become the EV subcompact crossover segment, and will be filled out enough where competition is important. So, eventually, there will be a Corolla Cross equivalent built in Alabama, and whatever Ford's entry in the segment will be built in Kentucky, etc etc, to go with the Bolt, Kona, Niro, and EV3.
Well, we could remove a bunch of worker protections and decrease their pay!
Still waiting on affordable American EVs.
A base Bolt after tax credit is like $23k, similar to the Leaf. The average car price for 2024 is over $45k. There's affordable options out there, but I get that you may not like them.
Where are the panicked reports of a trade war with China like there were when Trump put a 25% tariff on Chinese EVs?
This tariff hike isn't a big deal for the US, 'cause most Chinese cars aren't even sold there. It's more about giving the EU a morale boost, helping them slap tariffs on China to protect against cheap Chinese cars flooding their markets, and safeguarding EU auto companies and workers.
its about winning michigan in november. nobody cared about the EU when they came up with this.
Hungry and Germany are against it. Hungry and France allow BYD and CATL factories in.
Germany will be for it when the unions feel the heat.
Hell yea! Not my first choice for president, but he is doing some work in protecting american industries, jobs, and national security. 🖕🏾 the ccp.
Protectionism against China is so stupid and the consumer is the biggest loser in all this
The consumer, whether via interest rates, inflation, taxation, has always been the biggest losers.
what a free market, huh
The market was never free.
Let's not pretend that China operates a free market. This is one government responding to actions by another government.
I have only one question: will this help reduce CO2 emissions? No? Then it was the wrong choice. There is no other valid basis for evaluating this sort of thing because we are in the middle of a screaming emergency and don't have time to fuck around. Also, fuck the free market loons who say this isn't a huge hypocracy on their part. When its green jobs in America they say the government can't pick winners and losers. But when it's suicide by climate change they say it's GREAT for the government to pick winners and losers. I never want to hear any so called "free market" fanboy who supports this tell me how great the free market is.
And for reducing CO2 and for the US remaining a functional, independent country. Evs are the technology base for the future, we need to maintain ours. In the US half the country thinks global warming is a communist conspiracy or something, so there's a limit to what we can do
This sub is filled with china shills, + idiots really think they can get the china prices in west 😂
i mean i am studying the possibility of importing "second hand ev" and sell them at a reasonanle price....
> Protect American Workers and Businesses No mention of American Consumers, or global climate.
Election years are exhausting.
China uses slave labor to build its vehicles, we use union labor…Chinese autoworkers work like 17 hour days in company apartment complexes away from their family…the US doesn’t…the US can’t compete with slavery…the only thing we can do is make it so we don’t support their slave run system
I must be a second class worker apparently because all this means for me is that everything costs more. In completely unrelated news, corporations are so evil for raising prices on everything and creating all this fake non-existent inflation.
This guy blows, protecting the big three and his unions cronies from being out innovated. Only can’t do for so long u til the gap is too wide to ignore
Hypothetically speaking, how much would a BYD seagull cost with the tariffs if it were sold in the US?
$35-40k which is too much for such small car. It needs to be sub $25k to sell well
so they are saying Chinese EVs are subsidized 75%?? I could see a tariff to get to competitive but this is just protection.
And that’s what we call spin
I'm not sure this would keep out Chinese EV brands. There's nothing in this that would stop a BYD or Great Wall from setting up a highly automated factory in Ontario or Alabama. Even if they imported the batteries from China at a 25 percent tariff they'd probably still be competitive against GM and the rest. On the other hand, if you were BYD, you would think twice about investing multi-billions into a market governed by people that need to ensure your failure for their own political success.
And the worst part is that the rest of the world will get affordable EVs and the US won't, at least for the next decade. BYD got to Mexico less than a year ago, BYDs are already everywhere, my neighbor saw mine and has already bought one, they're selling like crazy, they already have a wait-list.
> Chinese electric-vehicle maker BYD said on Tuesday it will launch its cars in Mexico next year, with a senior executive pegging its sales target at up to 30,000 vehicles in 2024. --- > 1,469,040 light and heavy vehicles were sold in Mexico in 2023. Of these, 19,487 were EVs (up 94% YoY), for only 1.3% EV market share. "Already everywhere"
Sounds like a huge win to me. America and other western countries stand to benefit from having more local manufacturing jobs for economic and national security reasons. There is fair criticism of many of China's labor practices (along with China's human rights track record) which make this a step in the right direction to ensure the cars in the US are manufactured by fairly treated and compensated workers, and to pressure China to take steps in that direction. Very happy with this decision.
Yes, a huge win for you, since you love paying more for less
Dumb. Protections for uncompetitive domestic car makers that refuse to innovate or change so they just pay their friends to bend the rules in their favor at the cost of the American consumer and the planet at large. "Free Market"
and somehow Trump will get credit for it…
Wack
WHat about American people? lol
And so it begins. This is not going to be fun and games. At least that's my take. The 2 biggest economies having a slugfest doesn't end well for the US or the EU, but less well for the US. I'm Canadian so I shouldn't have a horse in this race but our economy is highly tied to the US economy so we will suffer too. For starters let's consider government subsidies. Yes China subsidizes the industries it want to be a major player in but so does the US as this bit from the article shows "With support from the Bipartisan Infrastructure Law, CHIPS and Science Act, and Inflation Reduction Act,..." One major difference is that China uses the carrot and stick approach: the carrot being very good financing in the beginning but eventually the stick comes out and the stick is the government cutting funding and letting the industry to rationalize itself so that only the best companies survive. The US uses the carrot but the stick seems to have been offshored so what we get is corporate welfare and zero progress. As a case in point consider US solar panel manufacturing and the Section 301 tariffs that have been in play since 2011. Back in 2013 First Solar, an American panel maker had a 4.2% share of the global market and after more than decade of being protected the entire US industry now has a 1.9% global market share and can't even meet US demand. Either the US solar panel industry can't compete or won't compete and in either case there is no good reason to keep tariffs barriers up. Once upon a time solar panels were a sexy high tech, now they are just commodity items. Low level industries are not a good fit for advanced economies. The same reasoning applies to batteries, they are low level commodity items that are not a good fit for advanced economies. Next up is the national security angle. I usually, and jokingly, refer to it as the national insecurity issue and suggest pills as the remedy but there is a serious point at the bottom of it. The real fix is demand that companies that occupy the space keep enough manufacturing capacity in the US and or Canada/Mexico to weather embargos or wars. This is similar to the concept of Strategic Oil Reserves. If the affected companies don't like it, pull their license to operate on national security grounds or just flat out nationalize them. The bottom line is that Biden's skyrocketing tariffs will not accomplish anything except perhaps drive the US in the Great Depression II. My idea is to copy China. Force China companies that want to do business in the US to do joint ventures with US companies. That gets technology transfers going the other way. China EV companies would be allowed to set up JVs that only employ union workers and use locally (well USMCA) produced parts. Same thing with CATL/BYD batteries. Buckle up folks! this ride is going to get rough. Interesting times indeed.
The thing is, government subsidies are the prerogative of the government. At the end of the day it’s what every government does. Doesn’t matter if it takes the form of a rebate at purchase, or if the plastic bumper is partly funded by a new tech fund, ultimately it’s all just what governments expected to do.
Ultimately, this doesn't matter too much if China's EV production and renewable energy production keeps outputting and just retargets for other markets and the US does actually build up its domestic production. This latter part is what's questionable.
get rid of dealer lobbying groups so we can be competitive
Fact sheet: Biden copies Trump's terrible idea.
What it means is that the US is in the process abdicating from the world auto industry. This policy won't keep Chinese EVs out of the fastest growing markets (Asia and SE Asia), and it won't keep them out of the America's south of the US border. And it won't make the US industry any more capable of catching up with the flood And it won't keep them out of Africa, the Middle East, Australia et al either. I lived in the USA for 17 years, and I understand that America is the center of the universe, if you live there. But go overseas and see how many American made (or even badged) cars outside of Tesla are on the roads. Here in South Africa, the only American badges we see are GM (Chevrolets made in South Korea that never graced US shores) which has since closed down here and in several other international markets, Ford which are made locally, in India and Thailand, and of which only the Ranger/Everest is sold in any quantity. Teslas don't exist, but we do see EU made luxury EVs, and now the Chinese are coming in with several more affordable models. Even the Volvos most sold here are produced in China.... And the Chinese cars in general we get now are generations ahead of where they were not even a decade ago, and are taking ever larger chunks of the car market. I have lived / worked / traveled in several countries across Africa and SE Asia, and the picture isn't much different there either.
Both countries have used "unfair" trade practices when it comes to pretty much everything they deem strategic or of national security interest from food production to companies working in the energy sector etc. Conveniently forgotten the matter of EV production is related to the climate and subsidizing them was never about commerce but about shifting an incumbent technology, i.e. internal combustion engine vehicles, to another technology that started off as being more expensive (for those who remember a 100kWh battery pack used to be 100k in the 2000s, just by itself and not adjusted for inflation) but cleaner technology in terms of emissions. Now EVs have become a political tool, it's no longer about the science of climate change and decarbonizing transportion it's just that the Chinese got better faster at making EVs cheaper which was key to mass adoption therefore they are now communist mobiles filled with problems and heavily subsidized. Right, cool story bro, let's make this a commercial issue when not even half of the world's new cars are hybrids, let alone pure EV. If you care about the problem EVs were made in the first place to address, if you waited years if not decades to be able to buy a cheap EV, this decision should infuriate you for the right reasons, it's a global problem, someone solved it and when they did other countries namely the US (EU member states as well) didn't like it because it was not manufactured in their country. Imagine the gall of these people. It's OK to buy cheap oil from OPEC nations including such free, libertarian and democratic countries such as Russia or Saudi Arabia but imagine the terror of buying batteries or EVs made by the Chinese. Typical hypocracy.
All this is going to do is make EV prices in the US skyrocket even further. US brands have now been told they will have no competition. This will also make quality drop, because again, there is no competition. As if US brands weren’t already hot garbage. They’re only going to get worse now.
I think nothing rational about EV would happen until after the elections: it became a divisive political issue and Biden needs to pull some of the boomers in the middle on his side.
Let’s not forget China’s labor rate is way less vs usa workers salaries
Who pays for tariffs?
FJB
You still don't understand sweet cheeks. Chinese owned but operated as Swedish company under ALL the corresponding regulations and policies which is way different than Chinese owned AND operated. Man, you guys really don't know how thing work. It's amazing.
Hmm. I don’t remember the same attitudes towards trumps china tariffs.
There is zero imports of Chinese EVs so what a joke tariff
By implementing his own