Other automakers can leverage the same Chinese supply chain as well as manufacturing innovations like gigacasting. Plus, image and brand matter as much as price and performance. Look at Japanese cars.
Isn’t the Japanese case an example in support of import tariffs and restrictions then?
So the title of this piece is more an expression of confidence that these tariffs/restrictions will emerge and prevail?
I’m also unsure how the parts business can allay concerns substantially at the “whole cars” level - I suppose the argument is that Chinese government has an incentive to ensure there are buyers for sellers for car parts (and not just cars)? Perhaps it is only owing to subsidies, but if whole cars from china are vastly lower in price than local cars of similar quality, then the argument turns back to the Japanese question of whether import restrictions are necessary.
I have no doubt that the f150 is iconic, but this is a petrol car. The matter at hand is the future of electric cars, and Chinese technology appears ahead on the cost curve for the key inputs (and whole products) there. So it is unclear that iconic brands can survive in this new category.
Very good article. How much of the supply chain can be leveraged enough while keeping the cost advantage going do you think? The price delta for a BYD seems pretty high already, and that advantage did work for Japanese automakers Vs their competition, even though they had a bit of protectionist benefit from an (initially) closed market.
Isn’t the Japanese case an example in support of import tariffs and restrictions then?
So the title of this piece is more an expression of confidence that these tariffs/restrictions will emerge and prevail?
I’m also unsure how the parts business can allay concerns substantially at the “whole cars” level - I suppose the argument is that Chinese government has an incentive to ensure there are buyers for sellers for car parts (and not just cars)? Perhaps it is only owing to subsidies, but if whole cars from china are vastly lower in price than local cars of similar quality, then the argument turns back to the Japanese question of whether import restrictions are necessary.
I have no doubt that the f150 is iconic, but this is a petrol car. The matter at hand is the future of electric cars, and Chinese technology appears ahead on the cost curve for the key inputs (and whole products) there. So it is unclear that iconic brands can survive in this new category.
Very good article. How much of the supply chain can be leveraged enough while keeping the cost advantage going do you think? The price delta for a BYD seems pretty high already, and that advantage did work for Japanese automakers Vs their competition, even though they had a bit of protectionist benefit from an (initially) closed market.