Transportation

Biden really, really doesn’t want China to flood the US with cheap EVs


Who’s afraid of China’s electric vehicles? President Joe Biden.

The president is preparing to announce higher tariffs on imported Chinese EVs, effectively closing out the possibility that the country will be able to afford to import its much cheaper and, in many cases, more desirable plug-in vehicles to the United States.

According to The Wall Street Journal, the Biden administration will announce plans to roughly quadruple tariffs, to 100 percent from the current 25 percent, as well as tack on an additional 2.5 percent duty.

Who’s afraid of China’s electric vehicles? Joe Biden

So far, the current tariffs have been effective at preventing Chinese companies from importing their EVs to the US. But officials are reportedly nervous about the willingness of China’s government to subsidize the auto manufacturing sector. China is the number one exporter of cars globally, even though virtually none of them end up in the US.

The Chinese auto industry is the largest in the world, and roughly 30 percent of the country’s vehicle sales are electric. Most of the world’s EV batteries are manufactured in China, and many of the country’s most popular models have been praised for their design, functionality, and price.

But US automakers have long been worried that an influx of Chinese EVs could effectively put them out of business. Earlier this year, Tesla CEO Elon Musk — who sells most of his cars in China — warned that Chinese manufacturers would “demolish” domestic rivals without trade barriers.  The concern is that Chinese EVs are so cheap — BYD’s Seagull sells for around $10,000 — that domestic automakers couldn’t possibly compete. Other politicians have called for an outright ban of Chinese-made EVs.

Fear of Chinese-made EVs has guided much of the Biden administration’s consumer and manufacturing policies over the past three years. The $7,500 EV tax credit, for example, is structured in a way to encourage automakers to source their batteries from within the US or its trade partners. Vehicles, batteries, and other components from “foreign entities of concern,” which includes China, are ineligible for the credit. And earlier this year, the administration launched an investigation into the potential security risks posed by smart car technology produced in China.

Despite these policies, Republicans, led by former President Donald Trump, have criticized Biden’s EV policies as setting the stage for a takeover by Chinese companies. In fact, Biden has kept many of the trade restrictions on China imposed by Trump — and introduced a few new ones of his own.

The new tariffs are also expected to apply to other clean energy goods, like solar panels and critical minerals, the Journal reports. This comes amid reports that China is preparing to flood the global market with less expensive products amid its own flagging domestic economy.

Of course, the dearth of affordable electric vehicles in the US is partly contributing to a slowdown in sales. And that could imperil Biden’s efforts to reduce carbon emissions attributable to transportation.



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