Trump’s electric car ‘bloodbath’ is here already, courtesy of China-owned Volvo

The “bloodbath” Donald Trump warned about in mid-March has arrived on US shores sooner than expected. When he created a media-fed controversy by using that word to describe the impacts on US automakers if Biden were to be re-elected, Trump was referring to plans by Chinese car companies to flood the American car market with cheap, high-quality SUVs by exploiting loopholes in tariff laws utilizing plants built in Mexico as the jumping-off point.

At least one such plant, by Chinese auto company BYD, is in the planning stages, meaning the flood is set to begin within the next few years. But Reuters reported recently that Swedish-based, but Chinese-owned carmaker Volvo (a subsidiary of China’s Geely) is about to beat the competition as soon as this summer with the introduction of a small battery electric SUV, the EX30, in the US. 

The EX30 will directly compete with the Tesla Model Y in terms of performance and features, but at a price tag of $35,000, $8,000 less than the Model Y’s current cost. Reuters writes that, “[t]he competitive price reflects an unusual combination of Geely’s China-specific cost advantages and Volvo’s ability to skirt US tariffs on Chinese cars because it also has US manufacturing operations.” Even better, Volvo says that, even at that market-undercutting price, it expects to realize a 15-20 per cent profit margin on the EX30, meaning it has room to cut the price further should Tesla or other companies find ways to meet its initial price tag.