The short answer is protectionism and import restrictions. And that's not just limited to cars. But it is starting to get a bit awkward as it seems that domestic producers aren't really stepping in the void created by these restrictions when it comes to EVs. The opportunity is there but nothing is happening. Why is that?
The more relevant question to ask is why American car manufacturers, with the exception of Tesla, struggle to export in volume and seem to have largely withdrawn from the international market.
I think it is simply because they are no longer competitive enough to survive without a lot of protectionist measures keeping superior products off the market. That works in the US of course. But it has also killed the export market.
The European perspective to this is that (Tesla excepted) you don't buy an American car because of performance, cost, efficiency, build quality, etc. A European might buy one because they are big, loud, and a bit obnoxious though. Seems to be a thing with some of the rich people here in Berlin certainly.
But you just don't see a lot of American cars here. When you do it's either some old sensible Ford model from when those were still being made; or an imported muscle car with some large engine making a lot of noise and smoke. I even saw an actual truck in Berlin a few months ago. These are very rare in Europe. They just aren't very practical. You can't navigate small streets with them. And nobody in their right mind would use these commercially because the fuel cost would be a big overhead. They are expensive toys but otherwise not competitive. Not even close.
> I think it is simply because they are no longer competitive enough to survive without a lot of protectionist measures keeping superior products off the market. That works in the US of course. But it has also killed the export market.
That said, it's still a reasonable strategy for the US to protect its domestic car industry from Chinese competition specifically due to open and hidden government subsidies that the Chinese government provides with the goal of owning this market segment (similar to solar panels and others).
This doesn't seem unreasonable if you consider the strategic dimension of outsourcing a key industry to an authoritarian adversary. As an aside, the EU is looking into this as well [1].
American automakers have gone all in on pickup trucks because they are massively more profitable per unit. Ford redesigned their entire lineup to exploit fuel efficiency laws so that they can sell more pickups without paying fines because CAFE is horribly implemented. Pickup trucks are mostly popular in the US.
>> American automakers have gone all in on pickup trucks because they are massively more profitable per unit. <<
They are massively profitable because foreign‐ made pickup trucks are subject to a 25 percent import tariff -- ie, limited competition:
Since a 1964 spat over European tariffs on poultry, the US has levied a 25% tax on imported trucks, now known as the “chicken tax.” That surcharge largely cleared the road for Detroit’s truck titans — at least until Japanese brands established US factories to get around it — and today means tricky economics for any foreign automaker looking to crack the lucrative American truck market.
Reality is that whenever US automakers make money, the unions strike and eat up the profits, then when sales slump the companies go bankrupt. Also, the pension and healthcare costs keep expanding and expanding, so that the big 3 American automakers are not really competitive and the Japanese automakers make thousands more per vehicle.
Tesla is winning, because they don't have the legacy automakers cost structure or a labor force that is taking all the money in the good times.
A little reminder that GM had produced a popular electric car in 1990s - only to kill it on their own to sustain combustion engine market domination [1].
Europeans too "can't buy cheap Chinese EVs" and yet there is a (slightly) bigger choice of models in Europe. Why? Because Europe has laws that requires car makers to make certain types of cars even if it's not the most profitable. Would this work in US? IDK. But opening up the market to the enemy is not the only way to change the situation.
I think it's complicated. On the one hand, protectionism results in duplicated companies, duplicated effort.
On the other hand (as is the case with the tarrifs between US and europe car industries) it results in multiple large competitors which sometimes results in a healthy market. The world and health of the economy would imo be much better if we had 6 or 7 competing mobile operating systems, or chip manufacturers, etc.
Duplicated effort means dignified jobs for the middle class to provide for their families.
If you globalize everything and have a super efficient atomized machine then there's a lot of people who've been 'liberated' from their jobs who then get crappy jobs with no benefits like driving ubers sporadically.
We don't have a world government that has a social contract to provide for all. Rather we have nations that sometimes provide for their citizens. And then theirs multinationals which sort of float above it causing mayhem for the plebs.
But to the original point, if you want cheap EV's you could build them smaller with less features and not try out out compete a F150.
Only if those were interoperable. Having two major mobile operating systems already requires app developers to think about two apps, or platforms that work on both apps, or limit themselves to the web. If we had 6 OSes and chip manufacturers wouldn't we end up with a much worse version of "developing for Linux is too hard because each distro does it their own way"?
Without trade wars, the state willing to externalize the most of the costs "win". Until there are proper environmental and labour protections everywhere the trade wars will continue.
>China, meanwhile, has become a global powerhouse in electric cars: It’s expected to account for about 60% of the world’s 14.1 million new passenger EV sales this year, according to BloombergNEF.
This is bull**. Why? Because in China it has became extremely profitable to manufacture the shittiest EVs possible and send them to ev graveyard fields immediately after manufacture (even the usual China cheerleader Bloomberg has to admit it: https://www.bloomberg.com/features/2023-china-ev-graveyards/ ) to claim China is "going green". All while approving 2 new coal fired power plant every week and laughing at us in the West as we go further to deindustrialise our countries, becoming reliant on China for basic materials such as steel(not even mentioning rare earth metals and how they mine/process them).
These articles are pure 100% pro-Chinese propaganda. See another example of a company cheerleading for the authoritarian regime Blackrock. They wrote articles just last year trying to convince people to "invest in China". Was this just incompetence? No it wasn't. https://www.google.com/amp/s/amp.cnn.com/cnn/2023/08/01/inve... Not only they lost a shit-ton of money. They were "investing" in companies using force labour and funding companies making stuff for the Chinese army. However, what is most important is that this came to the attention of the US congress when Blackrock started loosing money. When they were profitable no one would care... Bloomberg tries to portray themselves as objective, but their content shows where they really are on China.
Protectionism seems to have worked really well for China, and it helped America get to where it was 60 years ago.
Meanwhile, relatively recent free trade treaties hollowed the American economy out and contributed to its financialization. I'd like to go back, please.
Then you would be a loser in every way. The state of China today is far from perfect, but they got from nothing to where they are, industrializing within living memory. I think even people with strongest negative sentiments towards China recognize this as impressive achievement.
Well yeah. I don't know why you say "blatant" though, its not something to be ashamed of nor does any country make an attempt to hide it. As the article says, Europe has tarrifs on car imports too, as do most other nations.
It's not? I mean I'm certainly ashamed when I behave hypocritically* but I guess I've just watched too many Disney movies where the protagonist overcomes their pretensions and learns humility.
* Isn't the US the great bastion of the free market, rugged capitalism, entrepreneurial spirit etc etc etc? I mean at least that's what I see all the people on here claiming vis-a-vis why SV is better than everyone else.
A car is in fact a good example here - specifically, an ICE car. It's a contraption powered by repeatedly pouring explodium into a chamber and making it go off, then using the boom to both spin wheels and pull in more explodium for another run. More explodium means more power means faster car means better, right? On the contrary, an ICE needs just right amount of explodium, and is designed to ensure that; pour more, it'll stop and/or set itself on fire.
Same is with the market. Let it run completely free, and it'll collapse into bunch of tribes led by warlords, producing little more than suffering and death at scale.
> * Isn't the US the great bastion of the free market, rugged capitalism, entrepreneurial spirit etc etc etc? I mean at least that's what I see all the people on here claiming vis-a-vis why SV is better than everyone else.
I'm fairly new to US point of view (as in, I witness it only since like 10 years ago), but I feel like this has evolved, and the actual theories of "free market" (which include not having roadblocks, promoting SMBs because of diminishing returns , the need to inform the consumers, the integration of externalities in the taxes) are getting more and more support in the US, especially in SV. I think this has been severely pushed by US' Healthcare sector, where there is no obvious blatant anti competitive behaviors, but have profound negative impact on US society.
I think conglomerates killing small useful services by providing the same for free (but bad and without any further innovation) have also had impact there. I'm sure most people on HN has a service in their mind that used to be great, that got killed by Google doing the same for free, but that got enshittified and they are sad the original service is dead.
Used to be terrible (as in, 1/5) a few years ago, but now they are 4 or 5 usually.
I believe they are going to dominate the market as their EV offering is great, 450km of autonomy for 19000€. Similar spec in even low-end german makes are going for 40-50k€+
The mobile phone market showed that people generally don't care about a brand name, unless it's really premium. "Legacy" lower and mid-tier EU brands are going to have a hard time going forward imo.
>I think the EU shouldn’t be protecting local automakers from their greed…
Yeah, but automotive (when you also include all the various suppliers, not just the brands) is a big part of EU GDP, meaning strong political lobbying leverage from the industry especially in places like Germany, and workers in that industry also have quite strong unions meaning more political leverage, so I doubt the EU will drop local protectionism to. make the local industry more competitive
The EU has already been pushed out of costumer software and electronics industries and now depends on China and the US (yes chip nerds, I know ASML is EU, please don't mention it for the millionth time as if that fixes EU's lack of domestic champions), and at this rate the same will happen to its ageing automotive industry. Other than the established luxury brands like Ferrari, Porsche, Bentley, etc. the mid tier players could get decimated by the likes of Hyundai, BYD and Tesla.
I believe “they” are the European governments who would’ve otherwise received tax revenue from tariffs, versus “they” being the foreign car manufacturers.
I'm surprised no Chinese automaker has looked at the American market the way Japanese automakers did a few decades ago. Their cost advantage makes it a no-brainer and designing a car to meet American regulations shouldn't be that hard. It's easy to bypass trade restrictions by manufacturing in the US/Mexico if Chinese automakers think of the market in terms of a long-term investment.
Chevy Bolt, now discontinued, was in the $20K's. In general, EVs won't get cheaper until various supply-chain constraints (eg, batteries) are relieved.
Because US manufacturers will eventually get out competed even with reciprocal 25%-50% import taxes. With how things are going I'd be surprised if US even allows PRC cars from Mexico or Canada on US roads.
The Chinese are willing to work harder for less money to produce higher quality goods. A strategy that involves the US taking its ball and going home is likely to leave the US looking silly. If this line of thinking takes hold in the US government you'll have poor US families looking at poor Asian families in envy because the Asians have a car and a few other bits and bobs (maybe some extra food, air conditioning, a TV, whatever) where the US family has only the car.
I'm not even against jingoism, but couldn't it be channelled in a slightly more productive way? The US was at its peak when US nationalism meant the US enjoyed higher living standards than everyone else.
>The Chinese are willing to work harder for less money to produce higher quality goods.
Perhaps individual Chinese are like that, but sadly they are rules by an autocratic regime that is an open enemy of freedom and democracy. Furthermore, the upper management of every important business has ties to the party and is corrupt to the bone.
Is it in our interest to allow the Chinese controlled EVs to be openly sold in the west? The benefit could be that a poor US family might afford this car easier, the disadvantage is essentially forfeiting our security and making gathering intelligence for an enemy a lot easier. Just look at what Chinese do. It is forbidden for higher up officials in the party to use iphones. When someone important visits they actually block people in western made EVs (mostly tesla) from entering anywhere near. Why? Because they are doing exact same thing they are afraid of.
>Why? Because they are doing exact same thing they are afraid of.
By this measure, US would be saturated in Huawei phones like PRC is in iPhones. And US streets would be clogged with Chinese cars the same way western cars on PRC streets. Hell Ericsson and Nokia are still winning token 5G contracts in China. "Exact same thing" would be PRC/CCP allowing western brands to sell in PRC except in niche security circumstances. Question is whether US is more of a security state than PRC, or benefits more from protectionism of incumbant industries.
I mean, do you think that comment would make sense if it was about Soviet EVs and the Cold War was still going on? There's lots of people, and I guess previous poster is among them, who think there's something like a second one going on.
Parent's actual imgur is a very thin black image of a post from the grandparent commenter. It's quite on topic. However, I see imgur suggesting some very off-topic things below that, so I can see how you may have thought that.
Just stop. You know very well that neoromantique's image is very on-topic. killjoywashere, I, and everyone else knows that you know that, so there's no point in backpedaling.
Has anyone bought any electronic device made in China that wasn't cheap: cheap quality, cheap price? Now we're supposed to trust that their electronic cars aren't like every electronic device ever made there? Trade protectionism is saving Americans a lot of grief.
Definitely. Apart from smartphones, my Roborock beats my parents' Roomba across the board for the same generation. Price, UX, and cleaning ability. There is no intrinsic advantage to buying American*
More like 85+% of the entire iPhone BOM are still made outside China. Most key high-value, high-tech components like OLED display, AP, wireless modem, storage (NAND/DRAM), camera sensors, etc, are designed and manufactured by non-Chinese companies. China makes mostly low-value, low-tech components and assembly/packaging.
The more relevant question to ask is why American car manufacturers, with the exception of Tesla, struggle to export in volume and seem to have largely withdrawn from the international market.
I think it is simply because they are no longer competitive enough to survive without a lot of protectionist measures keeping superior products off the market. That works in the US of course. But it has also killed the export market.
The European perspective to this is that (Tesla excepted) you don't buy an American car because of performance, cost, efficiency, build quality, etc. A European might buy one because they are big, loud, and a bit obnoxious though. Seems to be a thing with some of the rich people here in Berlin certainly.
But you just don't see a lot of American cars here. When you do it's either some old sensible Ford model from when those were still being made; or an imported muscle car with some large engine making a lot of noise and smoke. I even saw an actual truck in Berlin a few months ago. These are very rare in Europe. They just aren't very practical. You can't navigate small streets with them. And nobody in their right mind would use these commercially because the fuel cost would be a big overhead. They are expensive toys but otherwise not competitive. Not even close.