4 ms·
The biggest factor is import tariffs
by firejake308 3y ago
The biggest factor is import tariffs
- seanmcdirmid 3y agoIt is a reciprocal import tariff, meaning China charges as much for American imports as we charge for Chinese imports (why BYD had to set up an EV bus in California, and why Tesla setup a factory in Shanghai). Used to work more to China's advantage (protection from American car imports) but now works to its disadvantage (since American car makers are now protected from Chinese imports).
- londons_explore 3y agoShipping low cost cars is fairly expensive. It might actually make more sense to have 1 assembly factory per continent and just ship parts. Assembling a car is < 1 days labour, so even if you're paying high north American labour rates, it's still cheaper than a spot on a ship from China.
- seanmcdirmid 3y agoBYD is going to set up in North America (like Tesla did). They can setup a factory in Mexico (where they are already selling cars?) just as easily as they can setup in Mississippi. I expect them to eventually setup in a car plant somewhere in an American southern state or Mexico. To avoid the tariff and for shipping reasons. Japan used to make a lot of their USA-bound cars in Japan, even the cheap ones. I guess that is a difference between the 70s and today, though.
- papercrane 3y agoThere are reports that they're looking to build a factory in Mexico. Likely for that very reason, as then they should be covered by the US-Canada-Mexico free trade agreement.
- londons_explore 3y agoThat agreement will get an asterisk added to it shortly before the factory construction is complete...