Chinese electric cars are still cheaper than American cars despite 100% tax

Among the 20 best-selling car brands in China in the first half of 2024, BYD maintained its leading position with 1.607 million vehicles sold - Photo: REUTERS

Even if the Biden administration imposes heavy tariffs on electric vehicles imported from China, some models from this billion-people country will still be sold at a cheaper price than American cars, showing the profound challenges that the US government's electric vehicle policy will face, Nikkei Asia reported on September 15.

Previously, on September 13, the US announced a tax rate of up to 100% for electric vehicles from China. This policy will be applied from September 27.

The results come after a four-year review by the Office of the United States Trade Representative (USTR) into unfair trade practices.

It is known that the number of cars imported from China to the US is very small, so this tax move is mainly preventive and prolongs the time for the US supply chain to catch up with China.

“China’s industrial policies targeting the electric vehicle market could pose a threat to federal investments in this sector,” a USTR representative said on September 13.

Although the Biden administration has tried to push people to switch to electric vehicles with government subsidies, China still leads in both production and consumption of electric vehicles after decades of effort.

Figures from market research firm MarkLines show that in July, electric vehicles accounted for more than 10% of car sales in the US. Meanwhile, the figure in China was about 50% - higher than the global average of about 20%.

There's no denying that the US electric vehicle market lacks two key things: electric vehicle charging infrastructure and entry-level models.

Meanwhile, major Chinese automakers like BYD have been able to leverage their vast domestic supply chains to help them compete in a crowded market, offering electric vehicles for as little as $25,000 or less.

In the US, even the leading electric car company Tesla does not have a model priced below $30,000. Electric cars in the US are always more expensive than gasoline-powered models.

Mr. Joe McCabe, CEO of research firm AutoForecast Solutions in the US, said that BYD's cheapest electric car is currently sold for $12,000. So even if it were subject to a 100% tax, BYD could still offer the cheapest electric car on the market, under $25,000.

In response to the new tariffs, on September 14, the Chinese Ministry of Commerce announced that “China will take necessary measures to resolutely protect the interests of Chinese companies.”

The Commerce Department asserted that tariffs would not solve the problems of the US trade deficit and industrial competitiveness, but would only affect the global supply chain.

Source: https://tuoitre.vn/xe-dien-trung-quoc-van-re-hon-xe-my-du-bi-ap-thue-100-2024091517355705.htm