[Etheryte]

Only 7.9 percent of all of their sales is outside of China. They can generate fancy numbers galore on domestic soil where they have both production subsidies as well as government aid for buying said vehicles, but it's very unclear how they're going to fare outside of China.

[ApolloFortyNine]

Only reason they wouldn't take off outside China is the astronomical tariffs the West are putting on Chinese cars (100% in the US).

Though depending on the wording, they may be able to just build a plant in Mexico and take advantage of NAFTA. I can't tell from the whitehouse post on the tariff if it's tied to country of the manufacturer or just country of origin (usually it's origin).

[_mlbt]

For me it’s not so much about the tariffs. Personally, I have concerns about driving a network connected car that is ultimately controlled by one of my country’s main geopolitical adversaries. There is a nonzero chance that if war breaks out between them, best case they spy on me or brick some functionality, and worst case they weaponize a software update to do something malicious.

EDIT: Just to clarify, I would love to be wrong about these concerns, as there will be some who do purchase Chinese EVs. Also it is not about xenophobia, it is about geopolitics and cybersecurity. If someone can reply showing me how my concerns about the CCPs ability to weaponize these cars are unfounded, I would greatly appreciate it.

[nujabe]

Isn't that a good thing? Personally, I would much rather be spied on by the CCP than the NSA.

[_mlbt]

> Isn't that a good thing? Personally, I would much rather be spied on by the CCP than the NSA.

Care to elaborate how being spied upon or worse by the CCP could be a good thing?

Additionally, depending upon how any hypothetical CCP back doors get implemented, you might get the NSA and others spying on you as well.

[nujabe]

The objectives of the CCP are primarily geopolitical, they are not interested in handing over information to domestic law enforcement that relates to my personal life. Further they have limited jurisdictional reach, unlike the NSA.

[solumunus]

What a foolish remark.

[vitorgrs]

BYD is also building a factory in Brazil. It's almost ready (the deadline was later this year).

The factory stays on the same place of an old Ford factory. Ford left...

Fun fact: The street is called Avenue Henry Ford.

[izend]

Including Canada (100%) affects the Tesla built in Shanghai that were being imported into Canada.

[worik]

> Only reason they wouldn't take off outside China is the astronomical tariffs the West are putting on Chinese cars

Doing very well in New Zealand and Australia

The dealers doing even better with 200% markups....

[tim333]

BYD have said they don't want to push export to countries where they are not wanted politically.

They seem quite engineering focused which seems to be serving them well.

[bhouston]

> ...they may be able to just build a plant in Mexico and take advantage of NAFTA.

If Trump is elected, expect then NAFTA to be changed to exclude competitors to Tesla in some fashion. There is already a lot of expectations that a Trump win will heavily benefit Elon: https://www.nytimes.com/2024/10/29/business/economy/elon-mus...

[bluGill]

NAFTA doesn't exist anymore. Trump replaced it with a "I can't believe it isn't NAFTA", I doubt he will reopen that again.

[FileSorter]

God forbid a US automaker benefit for providing Americans jobs

[_mlbt]

Exactly. People are all for globalization until it comes for their specific industry and job. I remember there being a great uproar and gnashing of teeth over the outsourcing of IT jobs to Asia back in the 90s and 00s, yet now there’s something wrong with protecting one of America’s remaining big manufacturing industries.

[echelon]

> Only reason they wouldn't take off outside China is the astronomical tariffs the West are putting on Chinese cars (100% in the US).

They're dumping domestic overproduction on foreign markets. You do that long enough and you can weaken your foreign competitors in their domestic strongholds. This can destroy high-value domestic jobs, lead to atrophy of expertise, and is especially bad to "strategic" sectors of the domestic industrial base.

Tariffs are a tool to protect domestic markets against dumping. Every other nation's automotive companies are free to compete in Western markets because they're not actively engaging in dumping. Their competition strengthens domestic rivals because it is fair and on equal footing.

Australia doesn't care because it doesn't have a domestic automotive industry to protect, so Chinese overproduction is essentially just foreign subsidized stimulus to the Australian population.

[Kon5ole]

VW's former boss mentioned in an interview that it took VW 3 times as long to make a car than it does for Tesla. So I think that while there may be some dumping as well, the main explanation is efficiency.

A company that builds a robotic factory from scratch and that only makes electric cars will be able to make cheaper cars than one who already has a huge headcount of combustion car workers. Auto workers are unionised and often working in factories bound by political agreements. You can't just close the combustion engine plant or reeducate everyone to make electric engines, it's years of negotiations.

If you start from scratch you don't have that problem, and you don't need to include that cost into the price of your cars.

That said, it makes perfect sense for a civilised society to protect their workers while they are reeducated and reassigned to new work by blocking foreign competition. But only for a while, while going all-in on the required changes.

Reality can't be ignored forever.

[bluGill]

VW has also learned a lot about making cars over the years. Fit and finish is reportedly better on VW vs Tesla. (this is very hard to measure though - once someone buys something as expensive as a car they are not emotionally willing to admit they made a mistake and so they will tend to ignore problems with their own while piling on perceived problems with the other)

[tonyedgecombe]

VW has become fat and lazy. It looks like they are just getting started on fixing that but they have a long way to go.

https://www.reuters.com/business/autos-transportation/volksw...

[churchill]

Western cope never gets old. Western automakers had the chance to dominate international markets, but they stayed back at home, making overpriced cars for their captive audience of local buyers.

Whenever competitors showed up, they laughed at them, before panicking when those upstarts starting challenging their market dominance. It happened with Japan, Korea, and now China.

So, if you feel China competes unfairly, close off your markets. Countries without a local auto industry will accept Chinese EVs readily. BYD & co. will snatch American & EU automakers' foreign markets before they come home to swallow you alive by building factories in low-cost countries like Bulgaria, Mexico, & Brazil.

Basically, the Toyota cycle will repeat itself because Western (esp. American) automakers spent hundreds of billions on share buybacks instead of R&D.

[echelon]

That is a vast oversimplification that discounts the incredible geopolitical changes over the past 40 years.

But at the end of the day, we're protecting our own interests.

[churchill]

I understand - I'm not wishing evil on the West. I want prosperity for all humanity. All I'm saying is that it's shortsightedness and hubris that even got Western automakers (and businesses at large) to this stage. Rest on their laurels, not learning from history, assuming the good times will continue unabated.

Just like Jack Welch and General Electric: financialize companies to the max, optimize for quarterly share increases, and earn billion-dollar bonuses. When the company inevitably collapses/shrinks after you retire, it's no longer your business.

Whether it's China's foray into nuclear, wind power, carmaking, solar, etc., they simply copy existing Western designs and keep developing them diligently while the incumbents optimize for quarterly earnings.

[IncreasePosts]

These complaints seem orthogonal to the question of China using dumping as a tactic to dominate a market. Even if you thought the US auto industry was very healthy and well run, it could still be existentially affected by a huge actor with near infinite money like the CCP dumping

[tivert]

> Only reason they wouldn't take off outside China is the astronomical tariffs the West are putting on Chinese cars (100% in the US).

Yeah, due to Chinese state subsidies and other assistance, China has a competitive advantage in automobile manufacturing as well as in many other areas. The US needs to show its commitment to free market principles and lets its auto industry die already.

[Barrin92]

>The US needs to show its commitment to free market principles and lets its auto industry die already.

Given that the car industry here in Germany opposed the (even much more moderate) tariffs the state subsidies certainly don't seem to scare them more than a trade war. It's just a repeat of the automotive industry dark ages of the 70s/80s when tariffs vis-à-vis Japan were enacted based on the same reasoning. You're just gonna have 20 years of no competition.

China is going to win the markets in the rest of the world, which is where the bulk of cars go now. It's gonna be funny when everyone in Asia is driving a 15k modern electric car and we sit here driving old second hand gas cars behind a tariff wall. It's like a reverse Soviet Union situation

[bluGill]

15 years ago China was opening up and looking to become more free over time. As such I would oppose any tariffs in the belief that drawing them closer to us is for the better. However now that Xi is in power he has been doing everything to oppose US (and EU, Japan, Taiwan, Vietnam...) interests and so I'm forced to support tariffs. In principal I favor free trade, but when I expect war with someone else I can't support them or allow them to get control of things we will need to fight that war.

[tivert]

> Given that the car industry here in Germany opposed the (even much more moderate) tariffs...

Isn't the German car industry pretty much all-in on China, and thus dangerously exposed to any retaliation? IIRC, they have lots of factories there and depend on their output for a lot of their revenue. It would be pretty easy for China to shut them down or make life difficult them with some kind of pretext.

Boy, do I wish governments shared business's wise preoccupation with next year's numbers.

[jajko]

The ideal 'free market' you are referring to doesn't exist in real world. Every single country out there champions their own companies, giving them as much unfair advantage as they can while punishing any competition as much as possible, for mostly good and rational reasons. US is no different. The rest is history, and thats written by victors.

Even say EU vs US is not so rosy in trade wars. Remember how German government played down VW's dieselgate? Every single state has something similar, even if not on same scale.

[thefaux]

That seems crazy to me unless we're prepared to rebuild our infrastructure to allow a majority of the populace to live car free. Otherwise completely eliminating our auto industry would be an enormous national security risk.

[tivert]

> Otherwise completely eliminating our auto industry would be an enormous national security risk.

But I have been told zealous adherence to free market dogma will guarantee national security, without explicitly considering it!

[Also, I'm being sarcastic. I thought people would pick up on the double-standard in my original comment, but I guess free marketers can be that kooky sometimes. Everyone should realize by now China is playing a different game vis-a-vis trade than the free marketers want to play.]

[IncreasePosts]

Do any free market absolutists actually say these things, or are you just attacking a strawman?

I assumed they would say something like tariffs=bad, unless it's to overcome market manipulation by some state actor.

[Neonlicht]

The uncomfortable truth is that industry IS state politics.

The Volkswagen CEO has the German chancellor on speed dial. If your government's politicians have an emergency session on the future of a particular company there is no "free market".

[tivert]

> Do any free market absolutists actually say these things, or are you just attacking a strawman?

Oh, they totally do. See https://foreignpolicy.com/2020/11/26/mcdonalds-peace-nagorno... (paywall bypass: https://archive.is/lNwNQ) for an example:

> Friedman’s claim was simple: The benefits of economic integration reduce the policy choices open to governments, making war—which disrupts that integration—so unattractive as to be practically unthinkable. If that sounds like the theory of the capitalist peace as understood by Montesquieu, Adam Smith, and Richard Cobden, well, it pretty much was.

If you're going all-in on the free market and globalization, you need an answer to the national security objections, and that (unconvincing) answer is the risk to profit that conflict represents makes conflict unthinkable.

The thing that free market absolutists frequently forget that market values are not the only values, even among market participants. That's especially forgotten by forum participants who read a book proceed to swing around Econ 101 like it's a club.

[HDThoreaun]

Chinese auto makers dont get any more subsidies than american auto makers get. Domestic sales get tax subsidies but international ones do not, same as US.

[freeone3000]

It would probably be better for the consumer.

[IncreasePosts]

Better for the consumer in the brief period before they are ripped off repeatedly due to lack of competition after the subsidies are not passed to the consumer.

[polartx]

Or if the build quality of their vehicles was not up to par with US regulation or the quality standards the US market is accustomed to..which seems very possible given the connotations generally shared domestically around the phrase “made in china”

[porphyra]

The build quality of Chinese electric cars is generally pretty good.

In the past "made in Germany" used to have derogatory connotations due to German goods being worse than British ones too.

As for regulations, the BYD cars consistently rank very highly on the stringent Euro NCAP tests: https://www.euroncap.com/en/results/byd/seal-u/50187

[amrocha]

Teslas have a reputation for shoddy quality but they’re still sold in the US, i’m sure BYD will be fine

[bryanlarsen]

Chinese made Tesla's are generally acknowledged to be higher quality than American Tesla's.

[onlyrealcuzzo]

"Made in China" in the US typically means "made cheaply" - which, if you look at what people buy, is actually what people typically want.

You get what you pay for.

In the case of electric cars, China has their own domestic market that actually wants to drive a decent car, and so they are building for that.

BYD cars aren't particularly "cheap" in the way a "Made in China" spatula is.

[consteval]

In the automotive world, US cars are the ones who have an image of poor quality. GM, Ford, and Tesla are routinely viewed as shoddy and suspiciously built.

[technion]

Byd is on every corner in my area of Australia. Much more so than Tesla.

[GoToRO]

Given the prices, 50% off, the only way they will not fare well is import taxes.

[jaggs]

Wow, really good that Tesla has received no government subsidies then. :)

https://www.ft.com/content/8179bd8a-4d96-43a9-a8f9-074f9a275...

[mtmail]

Is Tesla mentioned in the FT.com article? I can't access it.

On https://apnews.com/article/microchip-electric-vehicles-batte... Tesla is only mentioned by one state loosing a project.

"Many of the companies drawing the biggest subsidy offers — such as Intel, Hyundai, Panasonic, Micron, Toyota, Ford and General Motors — are profitable and operate around the globe. Some lesser-known names in the nascent EV field are getting big offers too, such as Rivian, Volkswagen-backed Scout Motors and Vietnamese automaker VinFast."

[jaggs]

Over $2bn in state and federal subsidies - https://archive.is/g5Gnb

https://imgur.com/a/XYSSnTQ

[kelnos]

Do we have any insight into how much the Chinese government supports BYD? $2B seems like a pretty small number, to be honest. I would expect the number to be at least an order of magnitude (or two!) higher for BYD.

At any rate, $2B is a drop in Tesla's bucket; their quarterly revenue is around $25B now. That $2B may have been given at a critical time in Tesla's development and growth, but today it would be 2% of their yearly revenue.

[hangonhn]

From: https://asia.nikkei.com/Spotlight/Datawatch/China-s-hidden-s...

"BYD received a total of 37.1 billion yuan in tax rebates over the five-year period, nearly four times the 9.3 billion yuan it received in subsidies. Additionally, BYD has secured long-term bank loans at interest rates between 2.05% and 2.98%, lower than the one-year prime lending rate of 3.35%, according to the company filings. "

So it sounds like it received 9.3 billion yuan or 1.3 billion USD but it also receives 4x as much in tax rebates.

[hmm37]

Which countries weren't offering tax rebates?

[fspeech]

Tesla gets the same rebate in China.

[CharlieDigital]

I was going to say that it's a bit disingenuous to point at China's subsidies for EVs and EV manufacturers and not look in the mirror.

US government has handed out tons of low/no interest loans, tax incentives, and tax credits to spur development and deployment of EVs and related technologies like charger infrastructure.

Just this year, there was a $4500 tax credit towards leasing a number of vehicles. I leased a Prius Prime (one of the vehicles eligible) and basically got $4500 off the sticker. Bought out the lease and purchased the car for $4500 off.

[teruakohatu]

They are selling a lot of them in New Zealand. It’s a small country so wouldn’t move the needle in terms of global sales, but I see them everywhere.

We have no domestic car manufacturing and no tariffs.

[cbhl]

BYD is already one of the top manufacturers for EV Buses globally. IIRC most (all?) of the electric GBuses in the Bay Area were by BYD, although they don't quite have the range to do the longer routes.

[fairity]

How significant are the production subsidies? Are they a meaningful percentage of sales revenue?

[hangonhn]

They're now mostly in the form of tax rebates and cheap loans these days. According to the Nikkei (https://asia.nikkei.com/Spotlight/Datawatch/China-s-hidden-s...) :

"BYD received a total of 37.1 billion yuan in tax rebates over the five-year period, nearly four times the 9.3 billion yuan it received in subsidies. Additionally, BYD has secured long-term bank loans at interest rates between 2.05% and 2.98%, lower than the one-year prime lending rate of 3.35%, according to the company filings. "

The overt subsidies mostly existed in the early part of the development process. It's a playbook that's quite commonly used in East Asian economies. Basically it goes like this:

1. Erected barriers to foreign competition and hand out subsidies to simulate local competition

2. Withdraw subsidies to push industries towards mergers and leave only a few big companies in the industry

3. Remove barriers to foreign competitions (i.e. invite Tesla) to foster innovations

4. Export

This makes it devilishly hard to quantify the amount of subsidies received and it's intentional.

China isn't the first to do this but rather borrowed the playbook from Taiwan, Korea, and Japan, who borrowed it from Germany, who, ironically, was inspired by the idea of industrial policy from Alexander Hamilton (https://www.bloomberg.com/news/audio/2024-03-14/odd-lots-ind...)

[fairity]

Thanks for the information! So, if the subsidies are in the form of tax rebates and subsidized loans, is it safe to say, the full economic benefit of these subsidies as a percentage of vehicle sales revenue is single digits? If so, it seems like there's little reason to doubt that BYD would be immensely successful in the US without tarrifs.

[maxglute]

Decent analysis:

https://threadreaderapp.com/thread/1804530313957106091.html

TLDR about $2000 per vehicle in 2024, trending to $0 per vehicle in next 5 years. Meanwhile PRC selling cars abroad for 2x+ domestic (i.e. 10-20k over), aka manifestly not dumping prices. BYD (and a few other PRC NEV makers) are successful because they used subsidies the way it should be used - to commoditize manufacturing to ModelT levels (500usd per unit vs when competition was 2000usd).

[asdajksah2123]

Selling a ton of cars in China, where the competition is fierce, is no mean feat.

[toomuchtodo]

https://www.bloomberg.com/news/features/2024-10-16/electric-... | https://archive.today/uJLa4 ("Bloomberg: BYD Is Winning the Global Race to Make Cheaper EVs")

> Last fall in Malta, BYD began selling the Atto 3, an all-electric compact crossover. Strip away the company’s futuristic logo, and it looks almost indistinguishable from other small, sporty SUVs. But inside it’s full of treats, including heated seats in vegan leather and a 360-degree rotating touchscreen. The 60-kilowatt-hour battery gives it a range of 260 miles, enough to circle Malta’s main island twice. And by European standards, it’s inexpensive, at about $28,000. It’s a novelty in Malta. But the real reason BYD is entering the European Union’s tiniest member state? The company’s happy place is emerging markets and countries with no domestic auto industry to defend: “You can basically describe them as a ‘chicken rib market,’ ” says Yu Zhang, the managing director of consulting firm AutoForesight in Shanghai. “All the chicken ribs added up together, it’s more than 10 million cars.”

> After increasing its annual sales in China 15 times over, to 3 million cars in only three years, BYD is now exporting to roughly 95 markets, including 20 new ones this year. The company is building, has recently opened or has announced plans for assembly plants outside China in 10 countries on three continents. The speed and scope of this expansion have caught the global auto industry off guard and triggered protectionist tariffs in the US and EU, where policymakers fear Chinese players such as BYD will, in the words of Elon Musk, “demolish” their domestic automakers.

[worik]

https://www.bydauto.co.nz/vehicles/atto-3

US$31,087.42 for the same car in New Zealand

Frustrating

[_ache_]

The percentage of their sales outside China simply means that China is big and they probably dominate sales in China. We already know that. China is so big that probably around 30% of Tesla's sales are actually in China.

What's interesting is how they compete with other brands, and I think the trend is for BYD to increase their market share in all countries.

However, I would have liked to have more figures.