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Prospect of low-priced Chinese EVs reaching US from Mexico poses threat to automakers

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China Government,Mexico,General News

America’s auto industry has grown concerned that Chinese carmakers may be preparing to set up shop in Mexico to exploit North American trade rules. The Chinese could then send ultra-low-priced electric vehicles streaming into the United States, devastating the U.S.

FILE - A BYD Seagull electric vehicle, with its hood open, is shown at the Caresoft Global facility April 3, 2024, in Livonia, Mich. China’s BYD last year introduced the Seagull, a small EV that sells for just $12,000 in China. FILE - Sales staff stand near the Seagull electric vehicle from Chinese automaker BYD at a showroom in Beijing on April 10, 2024. Considered a marvel of engineering efficiency, its lightweight design allows the Seagull to go farther per charge on a smaller battery.

Low-priced Chinese EVs pose a potentially “extinction-level event’’ for America’s auto industry, the Alliance for American Manufacturing has warned.Massachusetts Senate approves bill to expand reliance on renewable energy Whatever steps the U.S. government might take, though, would likely face legal challenges from companies that want to import the Chinese EVs.

At stake is an enormously consequential question: Who stands to dominate the manufacture and sale of zero-emissions electric vehicles? Still, for a Chinese EV maker like BYD, qualifying for duty-free treatment under the USMCA might be difficult even if it tried to source parts in North America. Still, Gantz said by email: “My takeaway is that using one or more of the available trade and national security mechanisms available to the U.S. government, the U.S. will be successful in excluding Mexican/Chinese EVs.’’

 

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