WASHINGTON DC – A group of US Senators has written to President Biden’s administration to urge the increase of tariffs on Chinese cars, with the ultimate goal of stopping potential imports altogether.
In the letter, Senators Gary Peters and Debbie Stabenow of Michigan, and Sherrod Brown of Ohio, ask the Secretary of Commerce and the U.S. Trade Representative to “move immediately to maintain or increase Section 301 tariffs on Chinese EVs.”
As it stands, they are preaching to the choir. The White House already announced that it has started an investigation into the backdoor to the US market that Chinese car companies are trying to obtain by expanding their production to Mexico.
With the new BYD Seagull facelift, Chinese electric car prices have dropped below the $10,000 threshold, way before anybody else has such mass market electric vehicles. More tariffs may be needed to stem their global onslaught.
According to a White House memo about the investigation, “China’s policies could flood our market with its vehicles, posing risks to our national security,” referring to the data collected by smart cars. “I’m not going to let that happen on my watch,” added Biden.
One of the Chinese companies that plan to build a factory in Mexico is none other than Tesla’s main competitor BYD, the world’s largest EV maker. It recently started a vicious EV price war, refreshing its whole roster while dropping its prices even further. For the first time, it has an electric vehicle that costs less than $10,000, too.
The new Glory edition refresh of the BYD Seagull electric hatch now starts from the equivalent of $9,700 for the base version and goes up to $11,930 for the models with larger battery and more range. Previously, BYD’s compact city car maxed out at $14,000.
Even with the current 25% tariff on Chinese EVs, the new BYD Seagull would probably start from about $15,000 if imported in the US, and such pricing could make life very hard for local manufacturers, including Tesla. At the last earnings call, Elon Musk was rather frank in claiming that “if there aren’t trade barriers established, they will pretty much demolish most other companies in the world,” referring to Chinese electric car makers.
“Artificially low-priced Chinese EVs flooding the U.S. would cost thousands of American jobs and endanger the survival of the U.S. automotive industry as a whole,” wrote the senators who hail from automotive manufacturing states.
According to the Chinese embassy, however, those competitive prices simply “reflect the high-quality development and strong innovation of China’s manufacturing industry,” as it protested the call for increasing the tariffs on Chinese EVs.
