US set to impose 100% tariff on Chinese electric vehicle imports
ft.com
ft.com
> amid mounting concern that China could flood the US market with cheap EVs
As a consumer, isn’t that a good thing?
A foreign nation dumping massive volumes of their heavily subsidized production onto your local market and putting your domestic producers out of business is not a good thing for any nation. If China could produce EVs far cheaper than the United States without using vast amounts of coal, and without those heavy subsidies on the whole supply chain let alone on manufacturers directly, then there's a free market argument for going tariff free, but as it stands going tariff free would be just letting dirty, unfair competition to go unchecked. It'd be political suicide let alone national industrial suicide.
One a more general note, even accepting your arguments about subsidies and production conditions doesn't overcome the fact that a lot of the vehicles depicted here are just better designed and more interesting-looking than western (and Japanese) offerings.
If legacy US auto and Tesla choose to not make cheap EVs, allow China to sell into the market (with strong right to repair and consumer protections around anything where these products could be used in an adversarial way, telemetry, data security, cloud dependency optional, etc). If these builders start delivering cost parity vehicles, implement tariffs accordingly to defend the domestic market from dumping (very common).
Worst case, we send all the battery packs off for shucking to use in stationary storage, or recycling by Redwood Materials. That’s US refined battery feedstock ore now. Regardless, we’ve got lots of combustion miles to replace with EV miles. We must move faster.
If a product is artificially cheap then making it more expensive is removing an artificiality, not adding one.
TLDR What are you optimizing for, what are the incentives, and what is the intent of various actors. The math is the easy part, imho.
When the industry in question is crucial to retaining domestic industrial capacity to counter that foreign nation’s hostile geopolitical agenda, yes it is worse!
Protect markets for legitimate reasons, not out of domestic nepotism and laziness. BYD gets government support, US auto should get the same, but you actually have to show progress towards desired outcomes to justify cross border protectionism.
https://pca.st/episode/830546d3-e3d5-42c7-9fb9-9710fc1604ac?... (citation wrt China EV not dumping)
That begs the question. They're only "hiding behind" tariffs if the price of Chinese manufacturing were fair in the first place but it's not. In this environment the Chinese manufacturers are economic aggressors and the Federal government is shielding local manufacturers from unfree competition.
> vast amounts of coal
Legitimate concern. Let’s make regulation around that instead, not just a blanket tariff.
I care more about ensuring America has sufficient industrial capacity than I do short term cheaper EVs.
I feel like China is up and coming and the west is scared and performing knee jerk reactions rather than effective governing around this change in dynamic.
so it's six of one now, vs a half-dozen later, except that you have to get to later to get the half dozen, and there's no guarantee you'll get there.
It's a subsidy for the manufacturer, as the manufacturer sees you got a credit from the government, and simply raises prices accordingly. Done as a way to meet demand and ensure the manufacturer works for the money.
This is also fundamentally why college and house prices keep going up, as the government subsidizes student loans and mortgages, and so colleges and such simply raise prices.
Yes, which is bad in my opinion, however subsidies in the form of US tax breaks stimulate US consumption it doesn't distort foreign consumption significantly, but also major foreign consumer markets put tariffs on US vehicles imports anyway for the same reason we are doing so.
Unfortunately not really, because any gains that would be had from prices going down are automatically erased by the Fed creating enough new money to ensure that average prices continue to go up. And rather than that money being injected broadly into the economy or spent by the government on useful endeavors, it just reaches consumers in the form of loans. So effectively EVs getting cheaper means that housing gets more expensive. See also: how the last 30 years of free trade policy has gutted American manufacturing jobs while not actually increasing individual purchasing power.
#1 - Ukraine, EU and US are engaged in a full out war against Russia and China. Why would US and EU want to allow China to destroy its car industry, while China helps Russia bomb, rape and kill Ukraine, and potentially EU/nato down the road?
#2 - Chinese EVs heavily subsidized by the government, to the tune of thousands of dollars of losses per vehicle. That's how China has destroyed solar industries in US and EU.
#3 - Chinese EVs are created in abysmal work condition and tons of destructions to the environment. There's no other way for US and EU to punish China on that except with tariffs.
#4 - they know some immoral consumers in US will ignore dictatorship concerns and just go for some cheap products, so they are taking a decisive step
#5 - other countries are already leveraging high tariffs on Chinese cars, or is in the process of doing so - it's clear to most countries that China is dumping. Europe has aimed to place 50% by November. Brazil has a 10% tariff that increases to 36% in 2026.
As a consumer in the US (and Europe), most of us do not want some cheaper car, just so our country can lose in a battle against dictatorship
That is wild hyperbole.
Modern cars are designed like smartphones with mandatory cloud connectivity and updates, but they are cars: a faulty / hacked car is far more dangerous to the public than a faulty / hacked smartphone.
A tariff helps balance the playing field for US manufacturing and does not try to solve the hacked car scenario
US needs manufacturing and tariffs unfortunately are in part necessary
China has the capability to support double the car manufacturing of its current domestic market, and plants have already been mothballed due to the glut https://www.nytimes.com/2024/04/23/business/china-auto-facto...
At this point the US is doing it to even the field since getting China to liberalize its economy further seems to be a dead topic.
Example of US vehicle manufacturing protectionism since 1964 called the Chicken tax: https://en.wikipedia.org/wiki/Chicken_tax
https://www.coxautoinc.com/market-insights/kbb-atp-february-...
All this sort of pointless protectionism really accomplishes is deny US customers from having more choices.
please if you are going to post a paywalled article, have the decency to post an archive link
because someone else will do it for you? is that really a decent attitude?
Don't just assume the worse and start throwing words around. We are all trying to have fun, learn and have a conversation here.
Then move on, knowing you have contributed a small act of kindness to the world today.
should we never speak of it?
Why might that be? Is it because imposing tariffs is the least costly option compared to making investments?
I also think there has been some domestic investment via the IRA, and I've seen government officials soliciting the construction of battery factories.
I think the problem is that as long as a Chinese supply chain is cheaper, any rational capitalist actor will choose that.
Market isolationism and protectionism is a clear signal of weakness.
To be clear, you're advocating for the rights of profit driven armed drug dealers to addict citizens of foreign countries?
https://asiapacificcurriculum.ca/learning-module/opium-wars-...
Consider your argument though:
> Market isolationism and protectionism is a clear signal of weakness.
In the case of China, it was too weak to fight off unwanted trade, it would have been a clear signal of strength if it had maintained isolationalism.
Being forced into trade demonstrated weakness.