China has become a powerhouse in electric vehicles. Its automaker BYD recently topped Tesla in global EV sales, with Elon Musk warning of Chinese carmakers, “If there are no trade barriers established, they will pretty much demolish most other car companies in the world. They’re extremely good.”
On Friday, the Alliance for American Manufacturing sounded the alarm, issuing a report entitled: “On a Collision Course: China’s Existential Threat to America’s Auto Industry and its Route Through Mexico.”
The report, which lists policy recommendations to combat overcapacity and unfair trade practices, notes that BYD is building factories in Thailand and Hungary designed to be regional export hubs. It then adds:
“More alarming, however, are Chinese firms’ heavy spending on plants in Mexico, through which they can access the United States by way of the more favorable tariffs under the United States-Mexico-Canada Agreement (USMCA). This strategy is, in effect, an effort to gain backdoor access to American consumers by circumventing existing policies that are keeping China’s autos out of the U.S. market.”
I went through this a little bit myself. My car has absolutely no utility whatsoever, which makes it a bit awkward as I get into woodworking and other physical hobbies. But the reality is, it costs me less than $100 including gas to rent a uhaul for a day. It’s a bit inconvenient that I can’t go buy stuff on a whim, but with a little bit of planning it’s ridiculously cheaper for me to just rent a uhaul every once in a while rather than buy a new car.