Along with Canada and Europe, the U.S. has implemented higher tariffs on imported Chinese EVs and various materials stemming from that country amid competitive concerns and others revolving around the potential national security threat those types of connected vehicles might pose. However, even with a 100 percent tariff on imported Chinese EVs, some of those models – which include the ultra-cheap $9,700 BYD Seagull – could still theoretically be purchased for less than pretty much any American counterpart if they do make it to those shores. Thus, it seems as if the Biden Administration is set to take further action to prevent that from happening.
“China is flooding global markets with a wave of auto exports at a time when they are experiencing overcapacity. We have seen this playbook before in the China shock of the early 2000s that harmed our manufacturing communities,” top White House economic adviser Lael Brainard is set to say at the Detroit Economic Club, according to prepared remarks for the event seen by Reuters. “The administration is determined to avoid a second China shock, which means putting safeguards in place before a flood of underpriced Chinese autos undercuts the ability of the U.S. auto sector to compete on the global stage. Americans should drive whatever car they choose – gas powered, hybrid, or electric. But, if they choose to drive an EV, we want it to be made in America, not in China.”
According to this report, the Biden Administration is considering prohibiting key Chinese software and hardware in connected vehicles that may potentially land on American roads, which would essentially ban almost all Chinese EVs from the U.S. on its own accord. However, Brainard also added that “China’s overcapacity in EVs will be a major area of focus as we look to the U.S.-Mexico-Canada trade agreement mid-term review in 2026,” hitting that it may also find a way to prevent Chinese automakers from building factories in Mexico to skirt higher tariffs.
Back in April, Mexico announced that it will not offer Chinese EV automakers any sort of incentives – whether that be tax cuts for investments in production facilities or cheap public land to build factories on – following pressure from the U.S. government. This is notable because – as Ford Authority reported back in February – that country’s largest EV automaker, BYD, has been eyeing Mexico as the potential site of its future North American plant, though it recently announced that it was delaying those plans until after the upcoming election. In the meantime, Ford is developing a low-cost EV platform to compete against these cheap Chinese EVs, but the automaker also isn’t planning on becoming a major competitor in those models’ home market, either.
Comments
Whoever wins the Presidential elections will not favor BYD building any assembly plant in Canada, U.S., or Mexico. But there are six other North American nations, from Belize down to Panama, that can qualify.
Without building the cars in NAFTA there’s no point.
Mexico is attractive because it’s in NAFTA, and cheap, and the CCP has a history of working with the Cartels already to smuggle fentanyl into the US.
And why are they able to make it so cheap? Ah that’s right they don’t have unions. And those that argue the factories are unsafe and they make a poor product should have nothing to worry about if we let these cars in, right? If union workers did such a great job the Chinese couldn’t come close to competing with us.
Or if the union workers were willing to work for a $1 an hour they could compete as well 🙄
We have no limits (based on nationality) where I live. The vehicles from China are a good value, and built every bit a well as others – comparatively.