Sunday's Energy Absurdity: How China Will Dominate Europe's Dash to EVs
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Sunday's Energy Absurdity: How China Will Dominate Europe's Dash to EVs
Sunday's Energy Absurdity: How China Will Dominate Europe's Dash to EVs
[Follow me on Twitter at @EnergyAbsurdity]
File this one under our “man, nobody could’ve seen this one coming!” category.
The South China Morning Post reports that officials in Europe are growing concerned that their legacy automotive industry is in danger of being overrun by cheap, heavily subsidized imports of high quality Chinese EVs.
Oh, you don’t say. Hey, who was it that taught the Chinese automakers how to make truly high quality EVs in the first place? As the CEO of an EV battery maker told me recently, it was the German automakers themselves, who have actively engaged in a voluntary technology and training exchange over the last decade.
You just cannot make this stuff up, folks. Don’t even think about trying - just let the Germans and the rest of the EU entertain you for free.
But hey, don’t worry: EU Chief Ursula Von Der Leyen is riding into the breach now to rescue Europe’s manufacturing sector from total Chinese subjugation.
Sure, she is.
Here’s an excerpt from the SCMP story:
South China Morning Post
Sat, September 16, 2023 at 4:30 AM CDT·7 min read
The European Union is scrambling to answer SOS calls from its hi-tech industries to fend off the challenge of China's manufacturing juggernaut.
From electric vehicles (EVs) and solar panels to wind turbines and hi-tech batteries, European businesses say they are being eaten alive by Chinese imports sold well below market rates.
This is not a new problem: the EU and European businesses have long railed against what they see as market-distorting subsidies.
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But industry figures say the problem has become particularly acute in sectors vital to European Commission president Ursula von der Leyen's de-risking agenda. Her response, they say, will be a test of how serious the EU is about having a resilient, green manufacturing base.
"It is now or never," said Johan Lindahl, secretary general at the European Solar Manufacturing Council (ESMC). "If investors don't see that Europe is willing to support an industry that is under attack by China, there will be no investments at all at scale."
Von der Leyen launched her first big salvo at China on Tuesday, announcing an anti-subsidies investigation into Chinese-made EVs, which Brussels says are being sold in Europe 20 per cent cheaper than local competitors.
At 3.7 per cent, these sales still account for a small share of the EU market, but are rising fast. Imports from China jumped 113 per cent in the first nine months of 2023 compared to a year earlier, while they have soared 78,000 per cent since 2019.
"It is a crucial industry for the clean economy, with a huge potential for Europe. But global markets are now flooded with cheaper Chinese electric cars. And their price is kept artificially low by huge state subsidies. This is distorting our market," von der Leyen said.
[Emphasis added]
[End]
What? You say those dastardly Chinese commies are subsidizing their own EV industry in exactly the same way the EU, US and other western democracies are doing????
Why, how rude of them. Such nerve.
Man, nobody could’ve seen this one coming! Well, except for literally everyone who is not an elected official in the western world, that is.
Holy crap.
That is all.
Sunday's Energy Absurdity: How China Will Dominate Europe's Dash to EVs
Will they ever learn?
Over a billion Chinese is a tempting, alluring market for western corporations under pressure from the stock market to never stop growing. The CCP plays this bargaining chip for all it's worth, in return for foreign business and technology know-how, and access to a market where the average American and European has a lot more disposable income than the average Chinese.
Plus, the foreigners are negotiating with party that is a combination of government and corporation. That party can work legal and regulatory powers to its own advantage.
Can anyone point to any of these ventures that became a big money-maker for the foreigners? Anyone?
Agree David that this is absurd.
We wrote about the Chinese invasion of the European auto market in our September 11th energymusings.substack.com article. Fifty Chinese auto companies showed up at the recent Munich auto show!
What seems to be missed by the regulators is that Chinese EV manufacturers have a 15% competitive cost advantage that is sustainable, as judged by investment bank UBS analysts. That advantage is after the shipping and import tax costs added to imported Chinese vehicles. I guess the European regulators would call the Chinese subsidies the country's cheaper energy, lower cost labor force, and manufacturers' focus on efficient battery performance relative to vehicle size. Now that their vehicle designs and quality have improved, just as the Japanese car companies did when they took on the North America auto market decades ago, Chinese auto companies will be formidable competitors. Could this be the last hurrah of the vaunted European industrial economy?