A tiny, low-priced electric car called the Seagull has American automakers and politicians trembling. The car, launched last year by Chinese automaker BYD, sells for around $12,000 in China, but it drives well and is put together with craftsmanship that rivals US electric vehicles that cost three times as much. A shorter-range version costs under $10,000. Tariffs on imported Chinese vehicles will keep the Seagull out of America for now, per the AP, but the rapid emergence of low-priced EVs from China could shake up the global auto industry in ways not seen since Japanese makers arrived during the oil crises of the 1970s. BYD, which stands for "Build Your Dreams," could be a nightmare for the US auto industry.
"Any car company that's not paying attention to them as a competitor is going to be lost when they hit their market," said Sam Fiorani, a VP at AutoForecast Solutions. "BYD's entry into the US market isn't an if. It's a when." US politicians and manufacturers already see Chinese EVs as a serious threat. The Biden administration on Tuesday is expected to announce 100% tariffs on electric vehicles imported from China, saying they pose a threat to US jobs and national security. The Alliance for American Manufacturing says in a paper that government-subsidized Chinese EVs "could end up being an extinction-level event for the US auto sector."
Earlier this year, Tesla CEO Elon Musk said Chinese EVs are so good that, without trade barriers, "they will pretty much demolish most other car companies in the world." Outside of China, EVs are often pricey, aimed at higher-income buyers. But Chinese brands offer affordable options for the masses—just as many governments are encouraging a shift away from gasoline vehicles to fight climate change. BYD would have to modify its cars to meet US safety standards, which are more stringent than in China. BYD told the AP last year it's "still in the process" of deciding whether to sell autos in the US. It's also weighing factory sites in Mexico for the Mexican market. More here.
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