Summary
– 76% of Americans under 40 open to buying Chinese vehicles, while only 44% of 50-59 year olds and 26% of over 60 year olds share the sentiment
– Joe Biden announced 100% tariff on Chinese electric vehicles, originally introduced by Trump in 2018
– BYD announced plans to build factory in Mexico, giving access to US car market
– Trump warned of “bloodbath” in US auto industry with Chinese EVs, but Biden administration matched tariff
– Elon Musk criticizes tariffs on Chinese EVs, stating they distort the market and inhibit freedom of exchange
Article
A recent poll conducted by AutoPacific showed that 76% of Americans under the age of 40 would consider purchasing a vehicle from a Chinese brand, despite expressing concerns about privacy. This figure sharply contrasts with the responses from older age groups, with only 44% of individuals aged 50-59 and 26% of those over 60 considering buying a Chinese vehicle. These findings come at a time when President Joe Biden has announced a 100% tariff on Chinese-made electric vehicles, a move believed to be a response to the influx of affordable Chinese models entering global markets. The current tariff of 27.5% is set to increase to 100% on August 1, following its initial introduction by former President Trump in 2018.
Chinese EV manufacturer BYD recently announced plans to build a factory in Mexico, a move that would provide access to the US car market due to Mexico’s membership in NAFTA. This development caused former President Trump to issue warnings of potential consequences for the US auto industry if cheap Chinese EVs were allowed free trade access to the market. Despite Trump’s threats of implementing a 100% tariff on all Chinese cars entering the US, the Biden administration has adopted the same policy, aiming to protect the country’s fossil car industry as it struggles to transition to electric models. This protectionist stance marks a crucial defense for American fossil car manufacturers, such as GM and Ford, which have scaled back their EV production plans in recent years.
According to Morgan Stanley analyst Adam Jonas, the increased tariff on Chinese EVs will likely encourage companies to focus on traditional internal combustion engine (ICE) and hybrid powertrain strategies, strengthening the US auto market against Chinese competition. While these measures may slow down the influx of Chinese electric vehicles into the US market, they are not seen as a permanent barrier to their eventual arrival. Tesla CEO Elon Musk, whose company is expected to benefit from the protectionist policies, has expressed concerns about the tariffs, stating that restrictions on free trade and market distortions are not beneficial. Musk highlighted that Tesla has successfully competed in the Chinese market without tariffs or government support, advocating for a tariff-free environment for fair competition.
The implementation of tariffs on Chinese EVs has sparked a debate among industry experts and stakeholders, with some expressing support for the protectionist measures to safeguard American manufacturers, while others argue that such tariffs could hinder innovation and market competition. Daniel Bleakley, a clean technology researcher with a background in engineering and business, has a keen interest in electric vehicles, renewable energy, manufacturing, and public policy. As the automotive industry navigates the challenges posed by increasing global competition, the impact of tariffs on Chinese vehicles on the US market remains a topic of ongoing discussion and analysis. The evolving landscape of the automotive sector, along with changing consumer preferences and government policies, will continue to shape the future of the industry in a rapidly changing global market.
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