[resters]

> The tariffs are to protect all US car manufacturers

Most of the US car manufacturers would have gone out of business in 2008 if the US government had not bailed them out. How can anything China is doing to help BYD compare with that? Yet Tesla still needs 100% tariffs on BYD vehicles to compete?!

Environmental regulations and alleged "slave labor" in China hasn't bothered the US government or US consumers for decades (most consumer goods are manufactured in China) yet somehow it matters tremendously in 2024 and necessitates 100% tariffs to protect US firms from competition?

Most of us lived through the era when the price per performance of computer hardware decreased rapidly and there was rapid price deflation on hardware that was only a few years old.

Right now, in 2024, American consumers should be benefitting from the far simpler design of EVs and car prices should be dramatically lower due to the benefits of EV tech. Car prices should have deflated but thanks to US policies entry level cars cost close to $30K now. The average price of a new car is $47,000

No, EVs do not need to be fancy, aluminum, giga-pressed luxury items! It's a battery and an electric motor and it should cost a LOT less than an internal combustion vehicle that has hundreds of precision moving parts.

We've seen the high quality engineering and low cost manufacturing China is capable of with scooters, hoverboards, etc. The essence of China's industrial policy is that in a few years some of those engineers start being able to design EVs that outcompete Tesla. Meanwhile in the US we are bringing back steel mills and coal fire power plants!

[nomel]

> Yet Tesla still needs 100% tariffs on BYD vehicles to compete?!

Why does Canada also have 100% tariff? Why do you think the tariffs are only for Tesla? Again, all US car companies have a fairly ludicrous government mandate [1] for EV production:

> In April, the EPA finalized its “Multi-Pollutant Emissions Standards for Light-Duty and Medium-Duty Vehicles for MY 2027 and Later” rule that could effectively call for 44% of new vehicles in 2030 and 56% of new vehicles sold in 2032 to be EVs. This rule greatly exceeds the current real-world consumer demand for EVs. Also, the rule projects that gas-powered vehicles (including hybrids and plug-in hybrids), now currently 92.9% of the market, could be reduced to 29% by 2032.

Chevy, Ford, and Toyota lose billions [2][3][4] per year making EV. They need this too. Tesla is the only US car company that profits from EV sales. Tesla, by every metric, needs it the least.

> necessitates 100% tariffs to protect US firms from competition

ICE cars are made of metal and plastic. There's a nice local and global market for these. BEV need lithium and cobalt. The US makes 2% of the lithium worldwide, with its single mine in a single location [5]. Lithium is 30-50% the final cost of a BEV. China makes 7%, but the Chinese companies have helped secure 80% of worldwide production [6]. Chinese companies owns 15 of 17 cobalt mines in DRC, where 80% of cobalt comes from [7]. The line between where a Chinese company ends and the CCP begins can be very very blurry. This is the result of very smart investment in China, and a big fuck-you to the environment and labor (making imports illegal [8]), like the good old days of the US.

> Meanwhile in the US we are bringing back steel mills and coal fire power plants!

China is responsible for 95% of new coal plant construction [9].

> giga-pressed luxury items

The giga pressing is to make them cheaper. Many car companies are looking at this for cost saving, including Toyota [10].

I agree with cars being too expensive. I've never looked into the breakdown for why. But, for the realm I work in, China is no longer much cheaper for labor. I suspect that's related.

[1] https://www.nada.org/legislative/epas-de-facto-electric-vehi...

[2] Ford loses over 4 billion with EV: https://www.cnbc.com/2023/07/28/ford-embraces-hybrids-as-it-...

[3] Chevy over 4 billion loses with EV: https://fortune.com/2024/04/24/gm-earnings-beat-gas-ev-elect...

[4] Toyota loses 4.7 billion with EV: https://www.reuters.com/business/autos-transportation/toyota....

[5] US only lithium mine: https://en.wikipedia.org/wiki/Thacker_Pass_lithium_mine#:~:t....

[6] China lithium monopoly: https://orcasia.org/article/602/chinas-monopoly-over-lithium....

[7] China 80% rare earth, 15/17 coral mines in DRC: https://georgetownsecuritystudiesreview.org/2023/06/01/china...

[8] Battery import illegal forced labor: https://www.reuters.com/business/us-imports-auto-parts-face-...

[9] China 95% coal plant construction: https://www.carbonbrief.org/china-responsible-for-95-of-new-...

[10] Toyota giga casting: https://insideevs.com/news/671943/toyota-giga-casting/

[resters]

So China is both using slave labor and also paying close to wage parity with the US? How can both of those assertions be true?

I think the lithium/cobalt argument is a bit of a straw man, since the generally accepted view is that the US likely has an abundance of such deposits but simply has not opted to do significant extraction.

Also, from the standpoint of the security risk associated with China controlling the supply, the US coudl also opt for strategic reserves of key items at a much lower cost than the cost of tariffs on the economy.

An easy way to help EV companies would be to stop spending trillions of dollars on petrolium-related wars. If you do the math, gas should cost at least double at the pump what it typically costs. The rest of the cost is the massive military operations needed to keep prices what they are. Those operations are not free by any means and are certainly not budgeted (so they are still yet to be paid for).

So in the supposedly capitalist US we have thousands in subsidy for EVs and Trillions in subsidies for petrolium related military operations, and now 100% tariffs on competitive EVs, etc. Why? Because China is evil? Because Saddam is evil?

[nomel]

> So China is both using slave labor and also paying close to wage parity with the US? How can both of those assertions be true?

Very trivial actually. The ones approaching wage parity are tech workers in big cities (what I deal with). The ones working as slaves are literally digging holes, sometimes in other countries. The battery supply chain contains both. The part that makes it easy for China to make cheaper batteries is the digging holes and fucking the environment part of it.

> the US coudl also opt for strategic reserves of key items at a much lower cost than the cost of tariffs on the economy.

They could, but they would, again, have to ignore environmental and labor concerns, which would require first changing federal laws that ban imported goods that used forced labor (see previous links).

> An easy way to help EV companies would be to stop spending trillions of dollars on petrolium-related wars.

Unfortunately, 93.2% of the 283 million cars on the road are ICE. This "easy" way involves a short term severe disruption, especially of the lower levels of the economy. But, I agree completely that subsidizing EV companies (including Tesla) and strategic foreign investments in REE is probably a better long term bet than building nice bombs.

I think the realistic result of all of this is that the economic pressures force the next gen of batteries to not use lithium or cobalt, or anything that China has 80% control of.

Cheers!

[resters]

Interesting points. I appreciate the discussion a great deal.

I really want to believe that the US is doing state of the art engineering and manufacturing in the EV space. You've given me some good things to think about.