8 ms·

I wonder how Tesla is going to respond. They might have most of the EV market in the US but if I was looking for my first EV, I wouldn't choose them.

presentation 2y ago
The US put 100% tariffs on Chinese EVs and the rest of the Western/developed world are probably going to follow suit so… they can probably respond by doing nothing in particular. I’m conflicted about these tariffs since on one hand I understand the security threats and I’d like the rest of the world to catch up so it’s not just China dominating the market, but on the other it seems sad that affordable and effective EVs are here and probably can make a significant dent in emissions but the politics keep them from being utilized.
- drcongo 2y ago
  What makes you think the rest of the western world would follow suit? From Europe it feels like massive tariffs on Chinese goods are a uniquely American phenomenon.
  - krolley 2y ago
    I would say the same thing for Australia. There is no local car industry there, so no protectionism from the govt. on importing foreign cars, one would assume.
  - alephnerd 2y ago
    > From Europe it feels like massive tariffs on Chinese goods are a uniquely American phenomenon. Where in Europe are you? The EU is looking at enforcing a 50% tariff on Chinese EVs in the coming months [0][1]. A trade war has already unofficially started between China and the EU [2]. [0] - https://www.politico.eu/article/probe-into-chinese-subsidies-for-evs-advancing-eu-says/ https://www.politico.eu/article/probe-into-chinese-subsidies... [1] - https://www.ft.com/content/31575d29-1945-4a90-8640-04967e1d1b2f https://www.ft.com/content/31575d29-1945-4a90-8640-04967e1d1... [2] - https://www.politico.eu/article/china-beijing-market-eu-trade-war-investigation-imports-goods/ https://www.politico.eu/article/china-beijing-market-eu-trad...
    - drcongo 2y ago
      Thanks for links, hadn't heard about this.
- sunflowerfly 2y ago
  The US is a relatively small market.
  - tooltalk 2y ago
    The US is the second largest by units sold (30M vs 15M) and the largest by value. The average selling price of a new vehicle in China is about $20K vs. US $50K.
  - alephnerd 2y ago
    It's the 2nd largest automotive market in the World [0]. The other large markets like the EU and India are also looking at tariffs for EVs exported directly from China and are pushing for Chinese companies to create domestic JVs in both countries (eg. BYD in Hungary, MG in India). [0] - https://www.statista.com/statistics/269872/largest-automobile-markets-worldwide-based-on-new-car-registrations/ https://www.statista.com/statistics/269872/largest-automobil...
- batter 2y ago
  Why they're affordable? I mean why other automakers can't have cheap cars but China can? There can't be any magic.
  - cladopa 2y ago
    Very simple. You could contaminate freely on China, but not in Europe and USA. You can use as much coal as you want, with as many ashes, sulphur or radioactivity as you want. That makes energy super cheap. But is is an external cost, people are paying with their health. Europe and USA went to similar periods in the past. Now China is regulating more and more because pollution is a huge problem there. Then you have salaries, that used to be cheap, now not so much. Also a very important thing is that in China capital is not free, it is a communist system and your savings account are used to subsidise what the Government wants. EV, solar, electronic chips and batteries are a priority so they receive infinite amounts of money from Government. Finally you have scale. China usually have enormous markets because it has so much people, although that applies to cheap things, for cars they don't have enough buyers inside so they want to sell in Africa and India and the West.
    - okasaki 2y ago
      China's life expectancy is higher than the US.
  - throwaway4good 2y ago
    A combination of industrial policy, extreme competition in China's domestic market for cars, and a huge eco-system of subsuppliers. Lots countries have had subsidies and incentives for electric cars; however China's policies seems to have been uniquely succesful - exactly why is not obvious. Some point to the "mayor economy" where cities compete in being attractive for companies to setup business. For example see the story of Tesla's Shanghai plant.
  - pjc50 2y ago
    - labour still somewhat cheaper - vastly easier land use situation, and impossibility of local protest - the big one: synergy. Making batteries and electronics and steel parts all comparatively close to each other inside the same customs zone. - less regulatory capture (they actually have to compete!)
- cladopa 2y ago
  What happens is that Chinese prices are not real because batteries and EV are subsidised by the Chinese Government. Also Chinese market is full of restrictions for foreign companies.
  - resolutebat 2y ago
    Sigh, this old trope again. The Chinese government stopped subsidizing EV purchases in 2022. There are some tax breaks, but they're also getting phased out. Neither is or was ever all that different from the various EV subsidies found in most Western countries. https://dialogue.earth/en/business/life-after-subsidies-for-chinas-evs/ https://dialogue.earth/en/business/life-after-subsidies-for-... Doing business in China is indeed very hard, but Tesla is still selling quite well there, despite absolutely furious competition.
    - cladopa 2y ago
      It does not need to be EV purchases. When the company I worked for went to China, it paid 0% taxes for several years. This is a subsidy. I worked there, and everything was subsidised, the steel and aluminium plants for example. If as engineer you don't pay taxes on your salary, you are subsidised.
    - tooltalk 2y ago
      China's EV subsidies have existed in various shapes and forms since 2009 -- they are always phasing out; then renewed, extended every 3-4 years. The last "direct purchase" subsidies ended on Jan 1, 2023; it was however extended as a "tax credit" in June 2023 for another 4 years with $72+B budget. This is also in the same article you cited (see translated below): Extension of the preferential tax policy for car purchases The total reduction and exemption is expected to reach 520 billion yuan —— Precision to provide assistance to the expansion of new energy vehicles 2023-06-21 The Ministry of Finance, the General Administration of Taxation, and the Ministry of Industry and Information Technology recently issued a joint announcement to clearly continue and optimize the tax reduction and exemption policy for the purchase of new energy vehicles to support the development of the new energy automobile industry and promote automobile consumption. According to preliminary estimates, through the implementation of the extension policy, the total scale of vehicle purchase tax relief from 2024 to 2027 will reach 520 billion yuan. Now, in addition to this, there also various industry subsidies, export credit/refund/rebates, and other financial instruments by gov't that are difficult to account for (because they are not public info).
- Dalewyn 2y ago
  >The US put 100% tariffs on Chinese EVs and the rest of the Western/developed world are probably going to follow suit so… Considering China, South Korea, and Japan just finished up a meeting which included moving forward with talks on a Free Trade Agreement in the face of American-led sanctions and tariffs... It's going to be fun seeing just how effective American diplomacy and economic violence actually is nowadays.
  - tooltalk 2y ago
    China, South Korea, and Japan really don't have the best diplomatic/trade relationship. South Korea has in particular suffered a great deal undr China's economic coercion since THAAD in 2017 -- their global giants like Samsung, Hyundai lost over 90% of their sales in China and they have likewise removed much of their manufacturing footprint in China. Not all too sure they want to jeopadize otherwise collaborative relationship with friendly ally, the US, for a hostile trading bully next door, China.
    - Dalewyn 2y ago
      That's what I would think too, but meanwhile Japanese PM Kishida looked very happy about the meeting and moving forward with FTA talks. I have no clue as to how South Korea felt about it, though given this was a trilateral talk I would assume similar sentiments. If that FTA does become a thing, the US will have lost before any hot war even began. May we live in fun times.
- asadotzler 2y ago
  They just go to Mexico after we've renewed the USMCA for 16 and Mexico stops being afraid of Washington D.C. In Mexico they assemble cars from Chinese parts and ship duty free to the US and Candada. Or build more factories in the US. Geely owns Volvo and they're building in the US. All the EU makers, the Korean and Japanese makers too have factories in the US. Tariffs are on real imports, not on US or USMCA made products.
okasaki 2y ago
They will make the cyberhelo, a stainless steel exoskeleton helicopter that crashes in mild wind.
vel0city 2y ago
They wouldn't respond, because Tesla doesn't make hybrid cars. If you were looking for your first EV, you wouldn't be looking at this car because it is not an EV.

presentation 2y ago

The US put 100% tariffs on Chinese EVs and the rest of the Western/developed world are probably going to follow suit so… they can probably respond by doing nothing in particular. I’m conflicted about these tariffs since on one hand I understand the security threats and I’d like the rest of the world to catch up so it’s not just China dominating the market, but on the other it seems sad that affordable and effective EVs are here and probably can make a significant dent in emissions but the politics keep them from being utilized.

drcongo 2y ago
What makes you think the rest of the western world would follow suit? From Europe it feels like massive tariffs on Chinese goods are a uniquely American phenomenon.
- krolley 2y ago
  I would say the same thing for Australia. There is no local car industry there, so no protectionism from the govt. on importing foreign cars, one would assume.
- alephnerd 2y ago
  > From Europe it feels like massive tariffs on Chinese goods are a uniquely American phenomenon. Where in Europe are you? The EU is looking at enforcing a 50% tariff on Chinese EVs in the coming months [0][1]. A trade war has already unofficially started between China and the EU [2]. [0] - https://www.politico.eu/article/probe-into-chinese-subsidies-for-evs-advancing-eu-says/ https://www.politico.eu/article/probe-into-chinese-subsidies... [1] - https://www.ft.com/content/31575d29-1945-4a90-8640-04967e1d1b2f https://www.ft.com/content/31575d29-1945-4a90-8640-04967e1d1... [2] - https://www.politico.eu/article/china-beijing-market-eu-trade-war-investigation-imports-goods/ https://www.politico.eu/article/china-beijing-market-eu-trad...
  - drcongo 2y ago
    Thanks for links, hadn't heard about this.
sunflowerfly 2y ago
The US is a relatively small market.
- tooltalk 2y ago
  The US is the second largest by units sold (30M vs 15M) and the largest by value. The average selling price of a new vehicle in China is about $20K vs. US $50K.
- alephnerd 2y ago
  It's the 2nd largest automotive market in the World [0]. The other large markets like the EU and India are also looking at tariffs for EVs exported directly from China and are pushing for Chinese companies to create domestic JVs in both countries (eg. BYD in Hungary, MG in India). [0] - https://www.statista.com/statistics/269872/largest-automobile-markets-worldwide-based-on-new-car-registrations/ https://www.statista.com/statistics/269872/largest-automobil...
batter 2y ago
Why they're affordable? I mean why other automakers can't have cheap cars but China can? There can't be any magic.
- cladopa 2y ago
  Very simple. You could contaminate freely on China, but not in Europe and USA. You can use as much coal as you want, with as many ashes, sulphur or radioactivity as you want. That makes energy super cheap. But is is an external cost, people are paying with their health. Europe and USA went to similar periods in the past. Now China is regulating more and more because pollution is a huge problem there. Then you have salaries, that used to be cheap, now not so much. Also a very important thing is that in China capital is not free, it is a communist system and your savings account are used to subsidise what the Government wants. EV, solar, electronic chips and batteries are a priority so they receive infinite amounts of money from Government. Finally you have scale. China usually have enormous markets because it has so much people, although that applies to cheap things, for cars they don't have enough buyers inside so they want to sell in Africa and India and the West.
  - okasaki 2y ago
    China's life expectancy is higher than the US.
- throwaway4good 2y ago
  A combination of industrial policy, extreme competition in China's domestic market for cars, and a huge eco-system of subsuppliers. Lots countries have had subsidies and incentives for electric cars; however China's policies seems to have been uniquely succesful - exactly why is not obvious. Some point to the "mayor economy" where cities compete in being attractive for companies to setup business. For example see the story of Tesla's Shanghai plant.
- pjc50 2y ago
  - labour still somewhat cheaper - vastly easier land use situation, and impossibility of local protest - the big one: synergy. Making batteries and electronics and steel parts all comparatively close to each other inside the same customs zone. - less regulatory capture (they actually have to compete!)
cladopa 2y ago
What happens is that Chinese prices are not real because batteries and EV are subsidised by the Chinese Government. Also Chinese market is full of restrictions for foreign companies.
- resolutebat 2y ago
  Sigh, this old trope again. The Chinese government stopped subsidizing EV purchases in 2022. There are some tax breaks, but they're also getting phased out. Neither is or was ever all that different from the various EV subsidies found in most Western countries. https://dialogue.earth/en/business/life-after-subsidies-for-chinas-evs/ https://dialogue.earth/en/business/life-after-subsidies-for-... Doing business in China is indeed very hard, but Tesla is still selling quite well there, despite absolutely furious competition.
  - cladopa 2y ago
    It does not need to be EV purchases. When the company I worked for went to China, it paid 0% taxes for several years. This is a subsidy. I worked there, and everything was subsidised, the steel and aluminium plants for example. If as engineer you don't pay taxes on your salary, you are subsidised.
  - tooltalk 2y ago
    China's EV subsidies have existed in various shapes and forms since 2009 -- they are always phasing out; then renewed, extended every 3-4 years. The last "direct purchase" subsidies ended on Jan 1, 2023; it was however extended as a "tax credit" in June 2023 for another 4 years with $72+B budget. This is also in the same article you cited (see translated below): Extension of the preferential tax policy for car purchases The total reduction and exemption is expected to reach 520 billion yuan —— Precision to provide assistance to the expansion of new energy vehicles 2023-06-21 The Ministry of Finance, the General Administration of Taxation, and the Ministry of Industry and Information Technology recently issued a joint announcement to clearly continue and optimize the tax reduction and exemption policy for the purchase of new energy vehicles to support the development of the new energy automobile industry and promote automobile consumption. According to preliminary estimates, through the implementation of the extension policy, the total scale of vehicle purchase tax relief from 2024 to 2027 will reach 520 billion yuan. Now, in addition to this, there also various industry subsidies, export credit/refund/rebates, and other financial instruments by gov't that are difficult to account for (because they are not public info).
Dalewyn 2y ago
>The US put 100% tariffs on Chinese EVs and the rest of the Western/developed world are probably going to follow suit so… Considering China, South Korea, and Japan just finished up a meeting which included moving forward with talks on a Free Trade Agreement in the face of American-led sanctions and tariffs... It's going to be fun seeing just how effective American diplomacy and economic violence actually is nowadays.
- tooltalk 2y ago
  China, South Korea, and Japan really don't have the best diplomatic/trade relationship. South Korea has in particular suffered a great deal undr China's economic coercion since THAAD in 2017 -- their global giants like Samsung, Hyundai lost over 90% of their sales in China and they have likewise removed much of their manufacturing footprint in China. Not all too sure they want to jeopadize otherwise collaborative relationship with friendly ally, the US, for a hostile trading bully next door, China.
  - Dalewyn 2y ago
    That's what I would think too, but meanwhile Japanese PM Kishida looked very happy about the meeting and moving forward with FTA talks. I have no clue as to how South Korea felt about it, though given this was a trilateral talk I would assume similar sentiments. If that FTA does become a thing, the US will have lost before any hot war even began. May we live in fun times.
asadotzler 2y ago
They just go to Mexico after we've renewed the USMCA for 16 and Mexico stops being afraid of Washington D.C. In Mexico they assemble cars from Chinese parts and ship duty free to the US and Candada. Or build more factories in the US. Geely owns Volvo and they're building in the US. All the EU makers, the Korean and Japanese makers too have factories in the US. Tariffs are on real imports, not on US or USMCA made products.

okasaki 2y ago

They will make the cyberhelo, a stainless steel exoskeleton helicopter that crashes in mild wind.

vel0city 2y ago

They wouldn't respond, because Tesla doesn't make hybrid cars. If you were looking for your first EV, you wouldn't be looking at this car because it is not an EV.